If you follow this blog, you probably believe that solar energy is a good thing, along with other renewable energy. You may also wonder why anyone would disagree, but the entire concept remains controversial.
Many states use tax credits to encourage the development of solar power and other renewable energy.
Opponents point out that renewable energy is intermittent and that renewable energy sources can’t survive without handouts from the government.
These claims beg at least two questions. <language maven hat> That is, they are based on a kind of circular reasoning that assumes the answer to a question it doesn’t actually address. “Beg the question” does not mean “raise the question” as so many people misuse the expression these days.</language maven hat>
What are the questions that go unasked by opponents of solar energy?
A local weekly newspaper recently hired a reporter, Mark Shiver, to cover North Carolina state government. In all the places I have lived, I have never seen such extensive state government coverage in any daily paper. The weekly is opinionated, but unlike most daily papers, freely admits it.
Shiver wrote “Renewable Energy Tax Credits Remain Controversial.” [The link no longer works as of 7/23/2106.] His approval of recent acts of the state legislature provides a very good statement of objections to solar energy based on intermittancy and tax credits, and therefore a very good opportunity to look at some solar energy facts and see what’s wrong with those arguments.
North Carolina established renewable energy tax credits in 1977. In 2007, the legislature passed the Renewable Energy and Energy Efficiency Portfolio Standard (REPS), which requires electric utilities to purchase no less than 6% of their electricity from solar or other renewable energy sources. The law raises the percentage to 10% in 2017 and 12.5% in 2020.
Now under Republican control, the legislature has frozen REPS at 6% and allowed nearly all tax credits to expire. They are extended for one year for projects sufficiently far along to be completed by January 1, 2017. Currently, North Carolina ranks fourth in solar electric capacity nationwide. When Ohio rolled back its tax credits it essentially killed the renewable energy industry there.
Begging the question on government subsidies
To Shiver, the Ohio experience merely provides evidence that renewable energy is crony capitalism, a sham that can stay afloat only through massive government handouts: subsidies, accelerated depreciation schedules, investment tax credits, grants, purchase mandates, and feed-in tariffs.
To claim that the renewable energy industry can’t survive without government handouts begs the question, can, or does, any form of energy survive without handouts from the government?
No. Not a one does. Not a one tries. Exhibit A is a warning from the coal industry about the dangers and risks of renewable energy. It concludes,
Coal, after all, is well supported and subsidized, directly and via tax breaks. Wind and solar are not; they are in fact the epitome of risky investment. Sustainable, long-term government programs mean safety for all investors. Investing in coal will always be a smart move, especially with well-supported, long-term government subsidies driving down costs, and a near-complete absence of subsidies for so-called “alternative” energies.
If the coal industry is well subsidized, are oil or natural gas any less subsidized? Of course not.
All of the government help Shiver complains about simply attempts to the playing field. The cost of wind and solar per kilowatt hour has been falling for years. Soon enough, it will be less expensive than coal. Considering the environmental and health costs of burning fossil fuels, which is not included in prices, solar may already be less expensive.
According to the so-called Swanson effect, the cost of solar cells drops by 20% whenever global manufacturing capacity doubles. Solar cells that cost $76.67 per watt in 1977 cost $0.36 per watt in 2014. Considering the recently proven technologies that have not yet gone on the market, the cost will continue to drop.
Discussion of solar energy includes two somewhat different concepts: solar panels installed on a house or other building and the solar farms built by utilities. They can be difficult to separate.
Your electric bill is stated in kilowatt hours. The Lawrence Berkeley National Laboratory has just reported that the average cost of utility-scale solar power has fallen to 5¢ per kWh, a 70% decrease since 2009.
The report notes that the current 30% federal investment tax credit will fall to 10% after 2016. Meanwhile, the fossil fuel industries’ much larger subsidies will not fall. The Swanson effect does not take subsidies into account. The cost of solar power will continue to decrease.
Begging the question of intermittency
Granted. Solar panels to not generate electricity in the dark. Wind turbines do not generate electricity unless the wind is blowing at some minimum speed. Shiver simply assumes that renewable energy sources interfere with the operation of an electric utility.
Another point not mentioned is that solar requires traditional forms of electrical generation to kick in when solar electrical production drops, not just at night but on overcast days, adding cost to production when a utility provider has to switch from solar power to traditional energy and then back to solar.
All that sentence proves is that Shiver has not investigated how utilities control production of electricity. Again he begs the question: how do utilities respond to changing conditions?
Without some means to store electricity, electric output must match demand. Energy storage has arrived. Cheaper and more dependable storage technologies are on the horizon. But let’s lay that issue aside.
Utilities operate several different types of plants in order to supply exactly the amount of electricity their customers demand at any given moment:
Baseload plants, mostly fueled by coal or nuclear power, operate continuously at full output as much as possible.
Some utilities are actively replacing old coal-fired baseload plants with natural gas.
Load-following, or cycling plants operate or not in response to variations in demand.
There are two kinds. Intermediate load plants meet most of the day to day variation. Peaking units operate only at times of peak demand, often a few hundred hours or less every year.
Peaking plants are not cheap or efficient to operate. And when does peak demand occur? Most likely on very hot days when everyone’s air conditioners are running and the sun is shining. The cost of solar plants is all in the manufacturing and maintenance. The fuel is free.
When utilities buy at least 12.5% of the electricity from solar, how will they use it? To replace baseload plants? Of course not, or at least not until storage technology permits. It will replace peaking plants and reduce the need for intermediate load plants.
Renewable and solar energy facts are not hard to come by. Unfortunately, neither is the kind of misinformation contained in the coal industry post that comes before the conclusion quoted earlier. Shiver appears most impressed with the latter.
“Clean” Energy / Coal Cares/James River Coal, 2011.
Generating Electricity / American National Standards Institute, November 10, 2011.
Solar Costs & Grid Prices On Collision Course / James Farrell (Cleantechnica, July 9, 2013)
Price of Solar Energy in the United States Has Fallen to 5¢/kWh on Average / Jon Weiner (Berkeley Lab News Center, September 30, 2015).