I think it is another great example of big government inefficiency and corruption at work. The government needs to stop subsidizing every market possible. It subsidizes solar and wind to help compete with natural gas, oil,and coal, which it also subsidizes. Why not get rid of subsidies on the other sources, before they subsidize other energy sources, or just not subsidize any of them and leave it to the free market.
From @bkcunningham‘s article:
“One of Solyndra’s major investors was George Kaiser, an Oklahoma billionaire who raised between $50,000 and $100,000 for Obama during the 2008 election.”
I work in the solar industry in NJ, where we have the second most PV installations and production in the nation. Sounds great, but I think we are going about it the wrong way and it is because of government interference.
During June 2011 alone, 520 solar projects totaling over 40 MW of capacity were installed,
representing the most projects and the largest amount of solar capacity installed in one month. That means the average system installed was about 77kW. The average system on a home is anywhere from 4–15kW. That means that most of the systems are very big installations, usually by corporations, which is who all legislation written about energy policy favors.
The 30% Federal tax credit is another tax cut for the rich. If a homeowner installs a system, they may save $10–15,000 in tax credits and those homeowners typically make decent money. But think about the corporations who install a $600,000 system. They just got a $200,000 tax credit.
Different states have different incentives, but what propelled NJ to the top of PV production was something called SRECs (Solar Renewable Energy Certificate). They are production based. For every 1MW(1,000kW) produced by the system, you receive a certificate that you can sell on a market, yet another one that government helped create out of thin air. Since a homeowner can only install a system no larger than the amount of energy they use every year, guess who these help? Those companies that install the 77kW system. A 77kW system will produce ~86MW a year in NJ. The average 2011 SREC price is about $550/credit. Thats another $47,000. An 8kW system, installed on a home, would produce ~9 MW a year. Thats about $5,000.
Not a terrible deal for the homeowner, who is finally hearing that solar may be affordable in NJ, though many can not secure financing for the installation because financing must be based on the price before incentives, but here’s the kicker. SREC values were estimated to decrease ~3%/year. They are based on the fact that the state mandates utilities to produce a certain amount of energy by renewables. Since most utilities aren’t producing the amount required, they can buy the credits from the SREC market to compensate.
Due to the overwhelming amount of production, mostly from the large installations, the value of the 2012 SRECs are currently selling for about $200/credit, making it not nearly as attractive to the homeowner and really screwing homeowners who bought the system based on a 3%/year decline in SREC value, but still attractive the companies that can install utility-sized system.
I fell that we need to rethink our energy policy. Most people hear energy independence, and think free from dependence on foreign oil. I’d like to take that even further, although it goes against corporate principles. Thanks to solar and wind, we can start breaking down and localizing the grid, community renewable energy co-op’s, or something like that. We are at the point where we can break free from the corporate energy monopolies that control much of how this nation runs, but I have a feeling that legislation on the Federal and State level is doing what it does best, creating a bubble that makes a few people richer and more powerful, and when it bursts, we may have a lot of clean energy, but the monopoly will still be there, the monopoly created by government interference.
Composing members:
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Composing members:
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