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Clean energy is good business
Submitted by R. Neal on Tue, 2008/04/15 - 2:31pm.
Interest in alternative energy such as wind, geothermal, and solar is spreading beyond so-called "fringe" environmentalists and "tree huggers" to the business world. If there is any doubt, consider this: U.S. clean energy venture capital investments totaled $2.7 billion in 2007, a 70% increase over 2006. Worldwide investments in clean energy totaled $148 billion, a 60% increase over 2006. Alternative energy is going mainstream. That's according a "2008 Clean Energy Trends" report by Clean Edge. According to their findings, growth in four key clean energy technology markets grew 40% from 2006, reaching $77 billion in 2007. They expect growth to exceed 300% over the next decade, reaching $254 billion. You've probably heard all the candidates talking about "green-collar jobs." This isn't just election year rhetoric. For example, an op-ed column in today's Nashville Tennessean says that Tennessee could gain $307 million in solar energy investments and hundreds of new jobs by the year 2015. The Solar Energy Industries Association (SEIA) says there are already more than 50 solar power related businesses in the state, including the Sharp Electronics solar panel manufacturing facility in Memphis which employs more than 200 workers and which, according to Sharp Electronics, has shipped more than 200 MW of solar array modules since 2002. The Tennessean column urges support of HR5351, the Renewable Energy and Energy Conservation Tax Act recently passed by the House and now being considered in the Senate. This bill extends commercial solar power investment tax credits, which are set to expire at the end of 2008, for eight years. It also extends residential tax credits for one year and removes the $2,000 cap. According to the SEIA, the U.S. could lose 116,000 jobs and $19 billion in solar and wind power investments if the tax credits aren't extended. Some might argue that this amounts to corporate welfare for the clean-energy industry. It should be noted, however, that coal, nuclear, and hydro power are all heavily subsidized by taxpayers, directly in terms of capital construction costs, infrastructure, and government regulation, and indirectly in terms of the environmental costs. Also, the amounts involved are a fraction of what we already spend on "traditional" power generation, with the potential for huge long term environmental and economic benefits. For example, the Clean Energy Trends report estimates the per-gigawatt construction costs for a typical nuclear plant at $2 to $6 billion (not to mention taking years to get online due to regulatory hurdles), versus $1.4 to $1.8 billion for wind, or $1.6 billion for geothermal. Solar is still more expensive at $5 to $10 billion (but in the same ballpark as nuclear), and unfortunately coal is still the cheapest (not counting the environmental costs) at $750 million to $1.4 billion. But, as clean energy R&D investment increases and manufacturers ramp up production, costs are expected to come down and efficiencies are expected to go up, so federal support in terms of tax credits and R&D funding makes sense. Both Clinton and Obama voted for the 2007 Clean Energy Bill. McCain abstained. That bill proposed these and other clean-energy incentives and would have paid for them by eliminating tax breaks for oil companies, shifting incentives away from polluters to clean energy producers. These provisions were dropped from the Clean Energy Bill as passed, but are now back as part of HR5351. It will be interesting to see how our three presidential candidates act on these proposals in relation to their day jobs in the U.S. Senate. Originally posted at Facing South |
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I agree that alternative ("green") sources are necessary part of our energy future. At the same time, I'm not sure it's all that useful to oversell it by making unrealistic cost comparisons. Take this paragraph:
This suggests we would economically be better off without nuclear power. We wouldn't be.
My understanding is that it will cost $2.5-$3 billion to complete Watts Bar unit two. The plant will produce 1,100 megawatts of power.
What is the realistic cost for round-the-clock production of 1,100 megawatts of alternative power? How many wind mills, consuming how much land, would it take to equal that? Do we want wind mills on every single ridge in East Tennessee? What would the true cost of that be?
At peak production (during the summer) we can get 10-11 hours of solar power generation a day? What about the rest of the day? What kind of storage system would we need to bridge the gap? What would that cost?
Like I said, I'm all for using "green" power to supplement our existing system, but lets be fair in our comparisons.
Brian A.
I'd rather be cycling.
The Tennessee Valley is probably the last place you would put a solar energy plant due to the number of cloudy days we have, but one answer to non-intermittent energy generation using solar is the new solar thermal technology that stores the generated heat for continuing use overnight and on cloudy days. There are at least two different solar thermal generation plants being built in the southwest that are also using two different storage technologies, so we should get some hard data about what technologies work best.
Just imagine if TVA had spent those nuclear dollars on green energy instead what a difference it would make.
Just imagine if the Iraqi war money was spent on green energy how we wouldn't need to be there getting our oil from under their land in the first place.
Just imagine if the $18 billion in subsidies (our tax dollars) the oil companies get were spent on green energy. We'd have a terrific view of the Smokies almost every day and no trees dying there.
Just imagine the jobs that would be created here by going green and the money that would not be going to the Saudis to finance terrorists. Just imagine our economy being healthy and our trade deficit changing direction by not buying all that foreign oil.
Oh well, let's wake up and go ruin another mountaintop!
"When the going gets weird, the weird turn pro."
Hunter S. Thompson
To clarify the two somewhat-related points I tried to make above:
--For the foreseeable future, coal or nuclear will be the backbone of the power grid in the Tennessee Valley. Pick your poison. There aren't any alternatives that can meet the demand.
--Green power is not the win-win proposition that some politicians make it out to be. It may be desirable; it may even be a necessary. But it is more expensive than the traditional sources we've used for the past 50 years. And higher energy costs are a tax on everyone.
The areas where green power is flourishing are where it is either heavily subsidized, or where energy prices are already much higher than they are in East Tennessee. Either way, people are paying more for energy.
I'm not saying this because I think alternative energy sources are a bad thing. To the contrary, I support development of it. I just don't think some of the public advocates of it are being straightforward about the costs.
Brian A.
I'd rather be cycling.
As I mentioned in the article, coal and nuclear (and oil) are all heavily subsidized, and there are socialized environmental costs that we don't even measure.
And (other than the ethanol people) who's not being straightforward about the costs? Granted, I haven't verified the numbers cited above re. cost per GW, but they come from what appears to be a credible source.
And as I pointed out, more R&D investment and ramping up manufacturing capabilities will bring the costs down.
In my view, solar is already competitive. Especially distributed (which is why big energy is not paying much attention to it). It seems to me that storage is the problem right now. Advanced battery technology and hydrogen generators appear to be viable solutions worth pursuing. And for large scale production, the thermal storage systems mjw talked about above are promising.
Here's a radical plan:
Link...
Also, check this out:
Link...
And here's some interesting reading:
Link...
You are so right on this Randy.
Those subsidies need to go to green energy and now.
There are so many good ideas out there that need backing.
Money not going to the Saudis is money in our pockets.
"When the going gets weird, the weird turn pro."
Hunter S. Thompson
CSP.
I would swap TVA's coal plants (especially Bull Run and Kingston) for nukes, if that were a choice. I don't know about the timelines, costs, etc. for finishing Watts Bar #2, but new nukes would take too long and cost too much. The nuke industry can't get investors in the free market so they get Congress to bend the rules and dole out subsidies, and even that's not enough. (While Congress can't extend tax credits and/or low interest loans for homeowners to make their own power.)
I'm a believer that we have to have a carbon tax or cap and trade in order to tame the CO2 concentration. Nobody believes a carbon tax is feasible, so it must be cap and trade and a nominal carbon cost in such a market would push coal out as too expensive. That would start to fix things.
And it's fair in the "free market" because it finally puts full life cycle costs onto the producer and consumer directly, as it should be, instead of externalizing those costs on society over time.
(Sorry if I strayed off topic.)
P.S. I still haven't gotten over to read those links, but the solar now w/ CSP part from SA looks to be in the same spirit of Joe Romm's posts at Climate Progress. Link...
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