Saw this story on the NY Times site today. In a nutshell, the Chinese government is massively subsidizing export of solar panels. This, in addition to cheap engineering talent, is expected to make it hard for U.S. companies to compete.
I'm conflicted here. If the Chinese government wants to help finance my purchase of solar equipment, that's good. But we don't want U.S. companies to be put out of business either.
Look at it this way -- if "beatin' those Commies" is the only thing left to inspire the Republican base, maybe this will clear the way for our own encouragement of alternative energy investment.
I mean think about it -- "beatin' those Commies" is the sole reason we ever landed on the moon.
They'd better do something about all that smog first.
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Solar power strikes me as a technology with room for lots of new players as the technology evolves. Plenty of opportunities for someone to come in with a better way of making cells and grow quickly. At least I hope so, because this stuff is expensive.
Actually this is quite amusingly ironic.
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China has the cash to subsidize and the low cost manufacturing capability. Though there is a lot of potential room for new players, I don't think there will be much room for players who can compete with that combination.
Luckily green energy solutions go beyond solar panels and into carbon management consulting etc. I doubt the solar panel manufacturing part of the green energy pie is going to be much of an opportunity for countries like the US other than in importing, reselling, installing and maybe servicing(?).
Eh, the US government also subsidizes solar energy with billions of dollars a year. And as far as the protectionist fears in the article, everyone knows nothing helps an economy more than restricting free trade!
Suntech, to build market share, is selling solar panels on the American market for less than the cost of the materials, assembly and shipping.
That requires a whole different level of subsidy than $2.3 billion in tax credits. And wouldn't free trade require two nations to have equally open policies?
I had posted a link to this interview Fareed Zakaria had with Thomas Friedman awhile back, but it seems relevant to his discussion.
So our five year head-start just evaporated?
The US should (and I bet will) take China infront of the WTO for dumping. China is breaking trade laws.
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What I think is reasonable to expect is that although we aren't going to be directly competing with China on cutting edge terms, they will completely run around us in low-cost factor. It's not about the American market, really -- it's about the global leadership. This will the Chinese to achieve things like locking down the entire African and Asian solar markets. Maybe even a sizeable portion of Australian market as well, who knows.
Of course, "solar" doesn't mean "solar panels" alone. It's entire infrastructure and generation/distribution/delivery lifecycle, and the Chinese are already more than willing and ready to build solar farms, solar/thermal powerplants, run power lines etc, manufacture and supply solar-optimized equipment like ice based cooling etc. When they come to Africa, they'll have all the pieces, all the know-how, and they'll ask for the fraction of the prices demanded by multinational and IMF proxies for the typical national infrastructure projects. It's going to be a game of inlfuence which China is going to win.
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Don't get to excited about solar technology. It is a very, very small percentage of todays electric generation. It is a great technology, but still needs and enormous amount of developement to become a useful alternative. I haven't come across the numbers yet, but it would be interesting to know if the energy used to make the solar panels, batteries, etc. offsets the energy solar panels generate.
That answer to that question is "it depends." Newer solar panels placed in sunny areas can recoup their production energy costs in under 2 years. Old ones, or panels installed in cloudy environments, take longer to break even (or potentially never do).
But the technology has improved substantially in the last decade.
The most cost efficient and promising designs actually don't use batteries to store the solar-produced electricity. The solar-thermal designs, for example, use that electricity to melt a mass of rock salt right on the spot. Having high thermic capacity, this substance retains the heat very well and can be used to power very simple-to-build steam turbines long after the sunset. This helps with the leveling on the supply side without needing to introduce the batteries.
On the point-of-use side, a similar approach to leveling has already been in place for many years for central air conditioning. There, the electricity is used to freeze refrigerant liquid (water) into solid ice during the time of day when the electricity is cheap or abundant (at night for coal or during the day for solar). The ice's negative energy is then used to cool the air in the building for many hours after the electricity was drawn down from the utility. Again, no batteries to produce, install, or recycle.
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The newer thin-film panels go net energy positive in under 1.7 years. This technology has progressed really rapidly.
The two sides to every story are true and false, not yours and theirs. Facts are not political; lies are. - Deven Green (Mrs. Betty Bowers)
I thought this newsweek article might be of interest. It talks of cases in which US public utilties are pushing back or attempting to gain control of the solar panels folks are attaching to their rooftops.
It's titled:
"Taking a Dim View of Solar Energy
Who could possibly be against homeowners using solar panels to power their homes? Utility companies."
http://www.newsweek.com/id/213468
This is classic dumping; they're using government money to destroy competitors in other countries. It's bad when we do it, and it's bad when they do it.
The thing is, they don't need to do that, because they already can pay their workers so much less -- assuming equivalent quality for a solar panel, they should be able to deliver it for WAY less than we can already, making a solid profit. We'll need to compete by making better panels than they can, or automating production more than they do.
Competition is nothing to fear, and if the Chinese win the solar panel race using their native advantage of cheap labor, more power to them. The world still ends up with cheap solar panels; from the standpoint of the world economy, it doesn't matter who makes them, as long as they're available.
Government grants to support unprofitable companies, though, are a big problem. Funding research is one thing -- that's fine, that's a good function of government. But the results should be available to everyone.
Government grants to drive competitors out of business, on the other hand, are very destructive. Fortunately, they're also explicitly illegal, and probably won't last too long.
Also note that, without government assistance, selling below cost is a perfectly valid market tactic. That's what made nylon so ubiquitous; the company that invented it sold it WAY below cost, at a level they figured would be profitable five or ten years out. That drove demand and got them into profitable territory much faster than they expected, and made nylon a huge economic force very quickly.
It's just too bad that it takes another 10 years to pay for the installation cost.
This article is not even close to being correct. One of the major problems utilities have with any type of generation from the public deals with the safety of not only the guys that work on the power lines but also the public. Backfeeding on the lines during outages have killed several linemen over the last few years. Having multiple sources of power instead of one source creates additional safety concerns. This only one of the issues involved with the public generating electricity. It is not so much that utilities are against solar generation or wanting a monopoly on electricity. There is just so much more to it than hooking it up.
No, my statistics included installation costs.
That sounds like a lack of the right training and procedures. It's the kind of thing that gets worked out over time.
Also, taking ten years to pay back the installation costs of a solar system sound terrible until we consider that paying for new power plants or modifications to power plants is an expense that is amortized over 30 years or more, secured by the guarantee of revenues from a monopoly position. In some cases, governments and bondholders wouldn't want power companies to see lower revenues wouldn't want to see lower revenues because they're still paying off the loans on existing equipment. However, if you need to add power generation in certain areas, it may well be better to add localized solar. There's no nimby concerns and the financing is borne by the homeowner.
What we would need to see is something similar to a mortgage for solar panels that can be transferred with the house. You borrow $60,000, and then you pay it back over 30 years or so the way you do a home mortgage. If you sell your home, the buyer takes over the payments.
We have had a couple of these at work here lately. The payout for one of these installations was around 10 years without any equipment failures, sunny skies, and lots of government subsidies. Nobody really knows the life of these type installations either. It is possible the equipment fails before one makes his money back.
Comparing solar installations to power plants is like comparing a pond to a Great Lake. Your comparing kilowatts to megawatts. They are on two totally different levels.
Forgive me, but where is your anecdotal evidence originating from? It goes counter to most of the google-fu I've come up with.
Maybe to a certain degree there was a lack of training on the utility, but there was a difinite lack of knowledge and training on the public end by creating a dangerous situation.
The ones I've seen are warranteed for 25 years or so. And the last time I checked, payout was around 17 years; if it's really down to 10, that's *great* progress in just two years or so.
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Does personal experience not count? There is a tremendous amout of propaganda concerning solar generation. I was just trying to give some insite about it since I work in this field and have been dealing with these installations.
And I'm all for solar generation. My point was it still has along ways to go before it a proven technology that is cost effective.
That's not uncommon in the early years of a technology when regulations, new codes and enforcement arms, etc. are adapting. I imagine something similar happened when motor cars were beginning to arrive on city streets in large numbers.
What I think we're lacking right now is the financial infrastructure and support infrastructure that exists for our current generation system. We have an entire legal and financial system that is very familiar not just with the technology of combustion generation, but also how to build, manage, and pay for it. So far we haven't seen a lot of serious movement to thinking about the way a solar-centric, decentralized grid would work and what changes in law, finance, and taxation would need to be made to get in place. Keep in mind that power companies have often benefited from government subsidies and cooperation because of their unique position as facilitators of economic growth. We shouldn't expect solar or other alternatives to either sink or swim in the unregulated marketplace as a test of their effectiveness.
That sounds like utility spin. Linemen up on the cables are going to treat a cable like its hot and double check regardless of whether they're told the power is out or not. If they arent using that caution and doing that check then it is oversight on the individual's part or faulty training, not the fault of some homeowner's solar panel. In his young life, my dad was a lineman and an electrician. Whether you are on a pole or in a house, you treat the wire with respect like it's hot. Whether its the mundane replacement of a receptacle, you always check, even if you are convinced what should be hot, what should be ground, even if you are sure the breaker is thrown, you take that moment. Code doesnt protect you from slipshod work of others and a hot wire is unforgiving.
I don't see the perspective that the utility should solely own solar panels attached to a person's house or property. The meter itself is different, that is consumption based. If people/towns are generating more electricity than they consume they should be compensated.
TreeHugger talks about the dumping that Malor mentioned.
I sat down to actually crunch some numbers on this, and after thinking about the problem a little, I'm realizing that the ROI number alone isn't enough to tell us very much.
Basically, in exchange for an outlay now, you get a cashflow in the future. But ROI is determined by A) what you pay to borrow the money now, and B) how much you can get by reinvesting your proceeds as you go. You have a carrying cost of the loan, which is very high in the early years, and then gradually you pay down principal and can reinvest your extra money. Inflation also plays a big part. In this case, it HELPS you, because you're borrowing for a productive item, and you'll be paying back in cheaper dollars with an item that's generating roughly similar economic value over time.
(this, by the way, is a classic example of debt that's potentially good for you. This kind of thing is totally what debt is ABOUT.)
So after noodling the numbers around, I realized that ROI claims alone are useless and can easily be deceptive. You have to determine ROI yourself, with the figures of how much it will cost you up front and what the expected inflows will be. The "ROI" you'll determine will be entirely dependent on what assumptions you make about the macro environment, like the cost to borrow, the opportunity cost of not investing elsewhere, the amount you can make with your spare cash, and the pricing environment for power.
You can't, in other words, make informed decisions based on claimed ROI figures, because ROI involves a lot of blatant guesswork. Assume ROI claims by manufacturers are bafflegab unless you can find the hard numbers underneath.