Solinequity

photovoltaic thin-film, solar energy, solar panels

A Higher Hurdle For PV

Comparing energy generation types is difficult. Most of the clean energy to brown fuel energy comparisons found in brief online journalism pieces are highly inaccurate due to the complexity of subject, which requires detailed analysis.  It is hard to do in two paragraphs.

Short articles about photovoltaic (PV) solar compared to brown fuel-generated electricity from the grid is no exception. This comparison generally never takes into account that;

1) The fossil fuel industries have received enormous government subsidies over the past 100 years resulting in highly valuable embedded infrastructure and business model advantages which new market entrants have to overcome. Consider, during a six year period beginning 2002, fossil fuel industries received $79B in government subsidies compared to $25B for all renewable energy types. Solar received only $2B.

2) The costs to society of increased health care and environmental damage (brown fuel generation externalities) from brown fuel extraction, local air pollution and climate change. This cost can be as much as $0.3 kWh for each externality type which you don’t see on your utility bill but you pay for in high health care premiums, taxes and cost of goods.

3) Vulnerability of fuel supply cost (energy security). The billions of dollars of going to war and security apparatus to secure central generation and supply chains.

A head-to-head comparison of PV to brown fuel generation that does not take these factors into account creates a playing field which is far from level for PV.

An article that I wrote previously on this subject can be found here.

The recap of this article: PV compared to brown fuel generation, where all the subsidies and non-direct costs are rolled in to the math, results in PV being at the same cost as utility supplied energy, or less, depending on region.

While I believe this continues to be an important marketing issue for the PV industry that needs to be highlighted continually, my intent is not to demonize the electric utility industry. Too often the renewable energy industry likes to paint utilities as the enemy when the utilities are playing by the rules handed them from regulatory agencies like the Federal Energy Regulatory Commission, the Regional Power Administrations and Public Utilities Commissions among others. The utilities are running complex, highly fluid businesses. They have massive investment in generation, transmission and distribution which need to be valued and considered when discussing an orderly transition to a clean energy future. While the utilities can be highly belligerent at times and unbelievably slow to morph to new business models and technologies, my intent on this page is to point out that there needs to be consideration of all variables when making energy generation comparisons and not that the utilities and their supporting supply chain are the bad guys.

Federal and state legislative bodies over the past century have created this unbalanced playing field. It will take bold action by current and future legislators to equalize this competition so that clean energy can be implemented in a rapid and economical manner.

I will be updating this page regularly with new research and information.

Resources for info on brown fuel generation relating to:

Tracking of Government Subsidies and Their Environmental Impact:                                                  http://earthtrack.net/

http://www.externe.info/

Government Energy Subsidies:
http://www.elistore.org/reports_detail.asp?ID=11358&topic=Energy_and_Innovation

Health Care & Environmental Degradation Costs:

http://www.externe.info/

http://www8.nationalacademies.org/onpinews/newsitem.aspx?RecordID=12794

http://www.eesi.org/files/energy_subsidies_072905.PDF