- All,

Attached is a link to an interesting perspective from a

Permaculture group in Australia concerning the IEA.....

http://permaculture.org.au/2008/11/17/staring-at-the-future-from-the-

top-of-the-slippery-slide/

I too think it is well written, being also that it is not full of

ideals of "stay the course." It comes from the other side of the

world with its own hydrocarbon issues.

In an age when we know we should be cutting back on emissions and

developing another means of transportation we - collectively, are

getting ready to burn the rest of our resources and release it as

CO2.

The Great Northwest Passage was shown on one of the TV networks last

night. They indicate that now without the ice blocking the route it's

a much shorter route for shipping - Hooray! But they also say it is

one of the best areas for continued drilling and extraction of fossil

fuels - which one is it?

I personally believe that we have much more creativity than this -

than we are currently using. If America decides to do something "big"

and make major changes toward the future everybody's going to want

in, eventually. Oil and gas technology is at its best, it has to be.

I believe it can be a tool for many things.

Take my flathead screwdriver for instance. It is sharp and square and

perfect for attaching and detaching slotted screws and bolts. But it

also doubles as many, many things. A leverage tool,paint can opener,

chisel/wood splitter, extraction tool (magnetized) etc, etc...

So should oil/gas technology be used for other methods of energy

extraction.

We have to.

Bill--- In hreg@yahoogroups.com, "Gary Beck" <eco@...> wrote:

>

> I would venture that many 'Houston'-REG members may have come from

> Houston energy, oil, gas, or chemical industries. Many probably

worked

> either directly around energy technologies, or formed knowledgable

> realistic energy opinions just by being here. With all these

experts we

> can have some fun and informative debates.

>

>

>

> But it's a gamble If you are trying to predict the future. Will

Spark

> run out of juice in 2010? Or will someone turn my home's 50 lbs of

> weekly solid waste stew into a 20 gallons of butanol in 2012?

Maybe we

> should check with a gambling expert. How do Las Vegas odds maker

lists

> whether fossil fuels will dramatically rise in the next two decade,

or

> not?

>

>

>

> I think they might note that the huge life style changing

populations of

> China, India, and emerging North Africa may want food, clean water,

> lighting, heating, cooling, and transportation, just like we do. And

> then energy will just flow to the highest bidder. I'm betting those

> bookies would set their odds based on these clear and unarguable

facts.

> So...the wheel is spinning,...time to place your bets!

>

>

>

>

> Chris,

Thanks for the feedback. I’m as eager as the next guy to see solar be cost competitive because I would like to use it. But I also am pretty hard-nosed about the money, so don’t want to jump in before there is a clear and convincing economic case, not just hype and not just environmental impact (call me selfish if you want; I don’t care, because I do other things that reduce my environmental impact/carbon footprint).

I’d appreciate your comments on these responses to yours:

1. The second calculation appears to use 4% as the expected return on an investment. That is a lot lower than the cost of capital. If I were to add solar to my home by taking out a home equity loan at my credit union, the cost would be approximately 7% APR for a 20 year loan.

2. I’m questioning your claim that insurance would just be a few dollars. My homeowners, windstorm and flood policy is currently approximately a total of $2832, only $708 of which is homeowners (I live near about 12 miles from the coast). Since windstorm and flood are basically controlled by the cost of the house and contents (whereas homeowners also includes a component that is “baseline” due to liabilities of people on my property, etc.), most of my insurance cost would, I think (I don’t have an actual quote), be proportional to my home cost. Since my home’s limit of liability is $179,000, I would expect a $50,000 solar system (which wouldn’t even begin to cover all my electricity needs) to be an additional approximately (50/179)*2832 = $791/yr. If I’m reading you correctly, the 31,250 kWh is per rated kWh over the 25 year lifetime. After the federal rebate, $50,000 would buy me (50000/5600)*31250/25 = 11161 kWh/yr. At my current utility rate of 12.9 cents/kWh, that amount of power would cost me $1440. Thus, the insurance alone would cost me more than half the cost of simply buying the power from my utility company. Am I missing something?

3. I was not aware of the property tax exemption until someone else brought it up earlier in this thread. Is that statewide or does it vary by region? Does it apply to all taxing authorities or only to city or school district?

4. Are you saying you expect no damage over the course of 25 years to the control system (from some kind of surge?), the panels (from storms or hail), or any other components? Sure, one can argue that this would be covered by insurance, but my experience with insurance is that typically you are out a couple grand in deductibles and if the damage were small (from a few hailstones or something) you might even end up paying all of it out of deductibles. I find it hard to believe that I could put panels on my roof and nothing would happen for 25 years. i.e., I doubt it is “risk-free” as you suggest.

5. Critics have long underestimated the time it will take for energy sources to be depleted. Even today, when it comes to electricity, there is plenty of coal and nuclear fuel, provided the plants are built. Given that most people depend on utilities, I suspect that the political will to provide reasonably powered electricity will be there and we won’t see astronomical rates except as spikes from time to time. If it were otherwise, the entire economy would screech to a halt. In that case, I’d probably have to sit outside my house with an assault rifle 24x7 just to keep my solar panels from being stolen! (look what thieves are doing with copper wiring today, and times are nearly as bad as they would be if electric rates doubled or tripled for an extended time).

Still seems to me that our best hope is to see costs of solar drop to be truly competitive with utility provided electricity. I believe that is only a matter of time. There are so many new and exciting solar technologies coming from new faces like Nanosolar etc.

Your last sentence was unwarranted: “If you don’t want to be part of the American energy solution, that is your choice.” I hope you didn’t intend to suggest that you are the one to define what is the “American energy solution”, that if I don’t install solar panels I am not part of the American energy solution, or even that the solar system I would install would necessarily be American in the first place. I could, for instance, buy 100% renewable windpower from a utility provider for less than the cost of solar panels on my roof, and that would seem every bit as much a part of the American energy solution as solar panels would be, and maybe even more (given the manufacturers of windpower are dominated by Americans). Even drilling for oil in ANWAR is an “American energy solution”, even if it isn’t one you like. And as I said earlier, I am seeking cost effective solutions, since my budget doesn’t allow me to splurge on big systems just because I feel like it. For example, for me, being a vegetarian happens to be a way I can both reduce cost of food, reduce health care costs, and reduce carbon footprint and environmental impact. I certainly don’t criticize those who choose to eat differently than I do or suggest they aren’t part of the American energy solution, nor do I criticize those who choose to invest in solar now. In fact, more power to them, as they are pioneers that are paving the way for eventual cost reduction as technology continues to improve. However, I just don’t buy the idea that it is cost effective today, nor that our government should subsidize the industry (except to the extent that it subsidizes utilities, though I’d rather it didn’t subsidize anybody). If I’m wrong, I hope you can provide more convincing figures.

Thanks for the discussion. I’d like to see you post a comprehensive analysis using realistic financial assumptions and let’s see if it does in fact make financial sense to install solar panels now.

Robert

**From:**hreg@yahoogroups.com [mailto:hreg@yahoogroups.com]**On Behalf Of**Chris

**Sent:**Monday, November 17, 2008 9:47 PM

**To:**hreg@yahoogroups.com

**Subject:**[hreg] Re: Cost of Solar PV same as Utility ElectricityRobert,

Your criticism is welcome as it allows us to clear up some questions:

1) The second calculation in the e-mail did include the cost of

capital. It shows that the cost of capital is on par with the

historical increase in electric rates.

2) Insurance cost increases are minimum. A few dollars per year.

3) There is no property tax on solar equipment.

4) There is no maintenance on solar equipment (unless you want to

squeeze a little more juice out of them and rinse them every few

months).

5) Extrapolating historic electric trends assumes there is infinite

fossil resources available cheaply (clean, high BTU, close to the

surface), which is not the case, so logic tells us fossil costs will

continue to rise exponentially (although they went out of control in

the last year and are now re-adjusting). Or, it assumes that an

alternative solution will arise and reach mass-production economic

efficency (which only happens with an initial investment).

There are plenty of reasons to have a solar system (or other

renewable power source). And if you don't want to be part of the

American energy solution, that is your choice.

-Chris

You can hang with the dinasaurs, or evolve with the survivors.

--- In hreg@yahoogroups.com, "Robert Johnston" <junk1@...> wrote:>

over 25

> Chris,

>

>

>

> You are missing the capital cost. If you financed the purchase

> years, you'd have a more realistic comparison, and it would be less

property taxes,

> favorable. Then add in the extra insurance costs, increased

> and maintenance costs, and you'll jack the price up even further.

BTW, I

> just purchased a 12.9 cent/kWh 12 month fixed plan from Spark Energy

[mailto:hreg@yahoogroups.com] On Behalf

> yesterday (for Brazoria County), so your 17.9 cents/kWh sounds high.

>

>

> Robert Johnston

>

>

>

> From: hreg@yahoogroups.com

Of Chris> Boyer

was part

> Sent: Friday, November 14, 2008 10:18 PM

> To: HREG

> Subject: [hreg] Cost of Solar PV same as Utility Electricity

>

>

>

>

> Many of you may not know it, but there was a solar incentive that

> of the bank bail out bill. There is now a Federal Tax Credit for

solar

> photovoltaic systems. This tax credit is very significant for home

owners

> in Houston because it now means that buying solar electricity is

comparable

> to buying electricity from your utility company.

25 years

>

>

>

> Here's the math (simple version):

>

> PV System cost ~$8,000 per rated kW installed.

>

> Federal Tax credit ~$2,400 per rated kW installed (no upper limit).

>

> Net Cost = ~$5,600 per rated kW installed

>

> The PV system will produce ~31,250 kWh per rated kW in Houston over

>

If I had

> The cost of solar electricity is then $5,600 / 31,250 = $0.179/kWh

>

> That's what I'm paying the utility company now (actually the REP).

>

>

>

> Example:

>

> 3.5 kW System Cost $28,000

>

> Fed Tax Credit gives you $8,400 back (you can carry it forward)

>

>

>

> Here's the math another way (complex version)

>

> Some will say that we have to account for the time value of money.

> the money to spend on a PV system I could invest it instead and get

a

> certain return (Although, if any of you can find a risk free

investment at

> this time, let me know!).

number)

>

> We can still start and initial payment at $0.179/kWh (or any other

> and add a required interest rate, or return percentage required on

our

> investment. If we do that, we also have to assume that electric

rates are

> going to increase with time over the next 25 years; they have

increased at

> an average to ~5 to 10% per year in Texas over the last decade. If

you

> escalate the electric price by 5% and account for panel degradation

(0.5%

> per year), and put your Tax Credit after the first year, they you

still come

> up with a NET POSITIVE RETURN of 4%. This may not seem like a high

return;

> however, it is absolutely risk free (home insurance will cover the

system if

> damaged) AND you are joining the millions who are leading the

nation toward

> sustainability.

same rate

>

>

>

> Even if you get a loan, you break even if you get the loan at the

> that you expect electricity to escalate.

incomprehensible

>

>

>

> Now you have every reason to put solar on your home.

>

>

>

> Here's the numbers for the investment with a return of 4%:

>

> (Sorry, I know many browsers will turn this table to

> jibberish).

>

>

>

>

> Year

>

> Generation

>

> (kWh/yr)

>

> Elect

>

> ($/kWh)

>

> $Solar Revenue

>

>

> 0

>

> 0

>

> 0.20

>

> -8000

>

>

> 1

>

> 1280

>

> 0.20

>

> 2656

>

>

> 2

>

> 1274

>

> 0.22

>

> 280

>

>

> 3

>

> 1267

>

> 0.24

>

> 307

>

>

> 4

>

> 1261

>

> 0.27

>

> 336

>

>

> 5

>

> 1255

>

> 0.29

>

> 367

>

>

> 6

>

> 1248

>

> 0.32

>

> 402

>

>

> 7

>

> 1242

>

> 0.35

>

> 440

>

>

> 8

>

> 1236

>

> 0.39

>

> 482

>

>

> 9

>

> 1230

>

> 0.43

>

> 527

>

>

> 10

>

> 1224

>

> 0.47

>

> 577

>

>

> 11

>

> 1217

>

> 0.52

>

> 632

>

>

> 12

>

> 1211

>

> 0.57

>

> 691

>

>

> 13

>

> 1205

>

> 0.63

>

> 757

>

>

> 14

>

> 1199

>

> 0.69

>

> 828

>

>

> 15

>

> 1193

>

> 0.76

>

> 906

>

>

> 16

>

> 1187

>

> 0.84

>

> 992

>

>

> 17

>

> 1181

>

> 0.92

>

> 1086

>

>

> 18

>

> 1175

>

> 1.01

>

> 1188

>

>

> 19

>

> 1170

>

> 1.11

>

> 1301

>

>

> 20

>

> 1164

>

> 1.22

>

> 1423

>

>

> 21

>

> 1158

>

> 1.35

>

> 1558

>

>

> 22

>

> 1152

>

> 1.48

>

> 1705

>

>

> 23

>

> 1146

>

> 1.63

>

> 1866

>

>

> 24

>

> 1141

>

> 1.79

>

> 2043

>

>

> 25

>

> 1135

>

> 1.97

>

> 2236

>I was curious, with regard to your discussion of Solar system costs, if there were more variables to be considered such as using cheaper thin film type panels. I guess, for one, that these aren’t actually available for residential construction yet as I can’t find them on line anywhere. But I assume they soon will be. I think First Solar just signed an agreement to make theirs available (in California ?).

Anyway, when they do become available, won’t they dramatically reduce the cost? I realize also that they’ll take up more space since they are less efficient per square foot, but fortunately almost all of my roof is facing south so there’s plenty of room.

I’m glad to see that solar is already on par with other forms of energy when played out over the life of the panels. I’m looking forward to the time I can jump in and ‘make a difference’, but in my situation, I still need a little more of a price break.

Thanks in advance,

Warren Benson