Monday 4 June 2012

It pays to check the sources

The post before this one was all about a Bloomberg report on solar power. The references at the end of the paper go for three and a bit pages. Just for kicks, I've had a trawl through them to see how many are good old fashioned peer reviewed papers in respected published journals. We know that the IPCC has relied on a lot of dodgy grey material that was purposely generated by green organisations and their hangers-on. So I went down the rabbit hole. There's just over 100 references - I had a look at a sample in the last post, but I didn't really dig into them.

Here's one I will dig into.

Seba, T., 2011. Is Solar PV Already Below Grid Parity?

Here's a link to the article. From looking through lots of other referenced papers, this article seems to have been used as the basis for declaring that solar is below grid pricing in certain markets. How much trust can we place in this article then? Well, let's start by having a look at the profile of Tony Seba. Note that he's the author of a book about solar power.

The blurb about the book states:

The Energy industry will make $382 trillion over the next 40 years. In this seminal book, technology strategy guru and visionary Tony Seba reveals market opportunities worth at least $35 trillion of that vast market by 2050. He shows why solar is the only clean energy source that can scale to meet global needs—and explores the disruptive characteristics that make solar technology inevitable.

Tony is clearly not in the pay of Big Oil. You can also:

Watch Tony Seba being interviewed on TV about “Solar Trillions” and “Solar Energy Business Opportunities”

Don't forget to collect your free set of steak knives.

Tony's article is essentially a mass of conjecture rather than hard, declared facts. He's claiming that solar is now at grid parity in California because a few small solar plants are apparently supplying power at below the 2009 Market Reference Price. We don't know the actual price the solar supplier is getting - the contracts are confidential and all the juicy bits like prices have been redacted. So all we have is guesswork and conjecture. It might be good guesswork and conjecture, but it's still guesswork and conjecture. Until someone un-redacts those contracts, we don't know anything for sure.

What we do know is this:

  • Southern California Edison, by law, has to buy a certain amount of renewable power. It doesn't buy it because it wants to - it buys it because it has to
  • SCE signed a deal with Axio Power to supply power from a solar plant
  • Axio Power was bought last year by MEMC
  • MEMC must be doing something really horrible - have a look at their share price over the last few years.

One thing that took me a long time was to discover whether this solar project was costing and whether it was receiving any subsidies. I couldn't find anything explicit, but with a bit of guesswork and conjecture...

Wind and solar industry trade groups worked together on lobbying for the extension of the grant program, which covers 30 percent of the costs of renewable energy projects (not just solar and wind, but also other forms of renewable electricity). Wind projects have received some of the largest awards from the grant program.

The American Recovery and Reinvestment funded the program, which was originally set to end by Dec. 31 this year. Wind and solar companies said the program was expiring too soon because the economy hadn’t recovered as quickly as expected.

Seems Mr Seba forgot to mention that inconvenient truth - would this project be able to supply power at "grid parity" if that 30% subsidy was removed?

And let's not forget that the states (such as California) also throw subsidies around:

One of the drivers encouraging solar power is the program California Governor Arnold Schwarzenegger signed into law in 2006, which created a $3.35 billion solar program to install 3,000 megawatts of solar photovoltaic systems.

I wonder if they also tapped into a program like that as well? Funnily enough, no one is saying anything public about the level of subsidy - it's all very hush-hush.

One thing is for sure though - you can't claim grid parity if your prices are artificially lowered by subsidies.

1 comment:

1735099 said...

"no one is saying anything public about the level of subsidy - it's all very hush-hush"
Much the same holds in this country when it comes to revealing the level of subsidy on fossil fuel energy sources.
In 2006 - 2007, for example, subsidies on fossil fuel energy sources were $9815000000. On renewables the total was $317000000. That's a factor of 30.
It hasn't changed much since.
A level playing field would be nice.....
I take great exception to watching the road I drive to work on (Warrego Highway) being buggered by the mining companies at the same time as my tax dollar goes into subsidies supporting their activity.