Thursday, January 7, 2016


So much has happened with solar and wind in 2015:  Wind now has a US capacity of over 70,000MW, and solar, between commercial grade and rooftop applications, is around 20,000MW.  Almost all this new technology has been built in the last 10 years, compared to the 100,000MW of nuclear capacity slowly constructed since the 1960’s, now diminishing because it has run its course.  The growth of both solar and wind will escalate exponentially in the next couple of years due primarily to the Paris Climate Change agreements, the five year extension of the tax credits, and the leadership and investments by both business and individuals.  The potential is huge! 

Case in point…my $12,000 investment in the PV system on my roof, returned $524 in this first year.  That’s a 4.4% cash return…tax free.  I’ve mentioned this to a couple of solar installers I’ve run into, and their response has been “ Is that all?”  A lot of people in Humboldt County are getting 6-10% back.  The reason I’m so low is that I went for the most expensive, high-quality system available (could have done it for about $8000), and there are a few shading issues in my solar window during the winter-time.  As the economics of renewables become more commonly and realistically understood, and as prices continue to come down for whole systems, the reality of cost-effective, cleaner, and saner energy will become mainstream.  A new 128KW system going on the old Yakima building in Arcata will pay for itself in 5+ years (16% return), and will generate over $1m in profit over the next 20 years; plus provide clean electricity to the 35 businesses housed there.  No CO2 or other emissions, no long term wastes, no need for cooling water, no need to extract, refine, and transport fuel…on and on!
Economic sense?  A fiscal conservative’s panacea?  All this in foggy Humboldt County; what about San Diego, Arizona, Texas, Florida?  I should do better next year, since PG&E announced a 7.5% rate increase, which began a few days ago on January 1st, and another one coming in June.

Three major changes are occurring, which testify why we didn’t get here sooner.
The first is the technology itself.  Solar panels are just a small part of the total investment package.  Inverters, wiring, and mounting racks are getting cheaper as demand justifies the economies of scale.  And of course, labor is one of the biggest costs.  As the industry grows and learns, all of these costs are decreasing to where most renewables are more competitive than everything else except natural gas; but that all can change very rapidly with issues of water, fracking, pipelines, etc.  Funny how natural gas is wholesaling at what it was about 20 years ago (25 cents/therm); yet PG&E is charging me $1.25-1.50/therm…mainly to pay for the upgrades to the aging gas infrastructure.  One installer told me solar electric is cost-competitive today with propane for water heating…an efficient electric water heater is 97% efficient.  No need for bulky solar water heating panels on the roof…just add a few more PV panels!  And just wait until energy storage really hits the market in the next few years…  The potential to use renewables in appropriate applications is almost unlimited…just wait!

The second major development deals with who is leading the green energy revolution.  Major businesses…old and new…are realizing it is cheaper, and a better investment to produce their own power.  We hear about Apple, Google, Tesla,  Audi…a lot of major corporations taking it on themselves to build wind and solar systems to power their facilities.  But media silent, a lot of smaller businesses, and commercial and residential endeavors are seeing the benefits in today’s “investment” reality.  One no longer has to “be rich” to afford solar.  Today, you can buy systems outright, lease them for your roof, and invest in someone else’s “roof” and get a decent return.  All pretty much guaranteed, with little worry of market fluctuation, crashes, etc.  The technology is very stable…no moving parts!...and now modular, so if for some reason a single panel or inverter malfunctions, it is easily and simply replaced.  My system has a 25 year warranty!  The only thing I did all year was hose the panels down a couple of times, and scrubbed them once when I also did my windows in early summer.  As long as the sun shines, the money keeps rolling in!  We’re seeing a change in how the financial institutions, local governments, and the general public views solar…no longer a subset of wacko “enviros” wanting to save the earth; but a major moneymaking investment tool, with environmental benefits.

The third area of concern deals with politics, or whatever you want to call it.  The whole concept of Global Warming, Climate Change, Greenhouse…all of that has been crucial in the renewable energy picture.  How the fossil fuel industries, media, financial institutions, politicians and even the average ignorant person have portrayed the use of solar and wind has been very well manipulated by the powerful few.  As it has finally been exposed publicly, Exxon did most of the leading research on Climate Change back in the 70’s and ‘80’s, and spent the last 20 years colluding with others in the fossil fuel business interests,  spending tens of millions of dollars buying scientific “experts,” politicians, and the media in a brilliantly executed PR stunt of denial…the biggest hoax in human history!  Well, all this is changing; and the presidential campaign in 2016 will feature a major battle between “greed and the environment.”  It’s no longer a battle between “jobs vs. environment.”  It will be interesting.

Two of my favorite examples show the power of the media to misstate, skewer, and actually lie about issues.  The first is the interview on FOX News when Germany announced it had produced 74% of its electricity from renewables for one day.  The guest “expert” said the US could not achieve that because Germany gets more sun than the US.  I’ll leave you to calculate that!  Germany is at the same latitude as southeastern Alaska!  “Let’s move on to Benghazi”
Not soon after on another segment, they reported a new study from the Wyoming Institute of Technology (you’ve heard of that great institution?) saying that PV panels are horrible because they suck out more energy from the sun than what is naturally beaming down to earth!
Obviously some folks in North Carolina believed this, because they recently voted down a solar project in their community…save the sun’s energy for their kids and grandkids.
One last example is an editorial written in the Wall Street Journal just a few weeks ago.
A couple of great letters in response:
Mainstream media continues to downplay the positive gains and potentials renewables offer. A recent article about wind in the Economist was titled “Wisps of Hope!”

This year will see enormous battles as states, and their public and private utilities, try to figure out what to do with the huge increase in individual owned energy generating systems.  Loss of electricity sales, loss of revenue, increasing costs of upgrading and maintaining the grid and local transmission lines, etc., etc.  These are all serious problems, which will be dealt with…how fairly, nobody knows; but one can guess from past experience how the fight will unfold.  Just like the land-line vs. the mobile phone, on-line banking vs. real bank tellers, carmakers vs. horseshoers, and a multitude of other industry challenges, changes will occur in corporate boardrooms, finance and legislative chambers, and research labs and engineering firms to accommodate the future.  Solar is not going away…it is escalating exponentially, with new, cheaper equipment, big and small scale electricity storage, and the shift in understanding the reality of our ability to move to cleaner, safer, job creating, cost effective, and sustainable renewable technologies. 

Add to all of this the potentials in new energy efficiencies and new energy storage (I still think utility grade hydrogen-fuel cell technology will be with us in a few years), and we have such a positive and exciting energy future.

Happy New Year!

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