Note: This is is a sub-page to this web-book, which examines subsidies for all forms of energy, brown and green.
This "Subsidy Farm" exemplifies the worst of both mindsets: (1) the monopolist utility executive, who can overpay and just pass the cost on to his captive customers; and (2) the subsidy greenie, who says subsidize anything "green" even if it makes no economic or even ecological sense.
Watch (I'm pasting quotes from the article): Georgia Power Co. financed and owns the five-acre solar farm. The initial 1,560 solar panels now in operation generate about 350 kilowatts of energy a day. Dalton Utilities will purchase the solar power for 22.6 cents per kilowatt under a 25-year lease agreement. That is more expensive than the average cost of the mix of coal, hydro, nuclear and gas power that the company uses now, but solar power is an important part of the mix for Dalton Utilities, Jolley said. So far, the kilowatts produced could supply two homes with power for a year, he said.
Catch that? The utility just spent oodles of OPM (Other People's Money) for 1560 panels and will pay twice the going retail rate for their 350/KWH/day output, which itself is a joke: My 54 panels produce 40KWH/day on average, 61.40KWH/day peak thus far. 350/40 = 875 panels. These folks consumed almost double (1560 panels), and we're both in Georgia, which means they screwed up in site selection, array erection, etc. More importantly, it's operating at a huge financial loss, and the utility's ratepayers must cover that double-pay subsidized price for 25 years.
Why? Because "solar power is an important part of the mix for Dalton Utilities...." Translation: "OK, I know it makes no economic sense but for some unmeasured, thus un-cost-analyzed environmental benefit, we're just going to spend tons of OPM -- because hey, it feels good. Like we have to do something, right? I mean, the greenies may just succeed in infecting Georgia's legislature and getting it to mandate that we buy green, no matter what the cost, and no matter whether it will ever make any sense, so hey, we might as well blow our wad now!"
It's like some Valley Girl got on Jay Leno's "Jay-Walking" segment to try and justify a blatant boondoggle. Even California is waking up and rejecting big solar projects absent electricity storage.
Want more? Just look at the total solar subsidy pig-out this one fellow consumed in Blairsville, Georgia, including 90% of Georgia's entire annual state tax credit -- on top of a 30% federal tax credit and inflated KWH-payments from the TVA. Any question it would have never been built without everyone else paying for it? I'd like to see his numbers. Want to bet it's over-the-top cost inefficient and thus, he's just a subsidy farmer?
Ditto for this Pembroke, Georgia subsidy farm described here. Note the multiple layers of voluntary ("green power program") and mandatory (fed/state tax credits) subsidies. Hence, these well-meaning doctors are farming subsidies, not economically viable solar power, much less the base-load power utilities value. In fact, check out this "PR" write-up by the array's installer. It "quotes" one of the owners claiming a 15-year payback, but of course that depends on subsidies (which means other people, including gullible Georgia Power customers voluntarily paying $5 extra -- "green power" -- are paying part of the tab, I'm guessing up to half, so it's really a 30-year payback cycle on a 30-year system). Even at that, Smith and his partner are being subsidy pigs by structuring ground leases to circumvent state limits on how much power they can generate.
And, of course, there's no thought at all whether, given their power's variable flow, the utility (otherwise forced by state law to buy it from them -- here, at 5 cents/KWH) even finds it useful. That is the state of solar power today -- every layer of it is government coerced and subsidized -- thus making this just another "Solar Subsidy Farm." More on this farm and its ultimately misguided, "second-tier-subsidy" expansion efforts here.
This pecan farmer story doesn't furnish numbers, but I'm betting he's just farming subsidies, too. Money quote: “The incentives (rebates, investment tax credits, exemptions, etc.) are really what drives the solar industry and deems these projects to be financially doable. As these advance, you’ll see solar becoming a lot more common.”
And from the American Southwest is this, while from the United Kingdom, there's this.
Keep this in mind: Not one solar greenie can ever point electric utilities of any scale (except in a few exotic places like parts of Hawaii) that burns oil. Hence, going solar will not lessen our dependence upon foreign oil. Worse, it produces only variable power that utilities don't find all that valuable: Their customers demand that their alarm clocks work 24/7 when they plug them in. No one's ever shown that utility-scale solar power (which is all these "subsidy farmers" produce) will make any economic or even ecologic sense -- because utilities can't count on them (too variable) enough to abandon brown-power plants.
In fact, I don't believe that utilities would bother even talking to solar producers but for state law forcing them to. And mini-utility-scale solar power (which is what solar farms are attempting to do -- feed mini-utility-scale power into a utility grid) is not ever going to become economically viable until the electricity storage issue is solved (i.e., the electricity solar generates can be stored -- to get you through the night!). That's why you never see mega-class solar panel farms, only subsidy-class (i.e., built just large enough to soak up subsidy limits) solar farms like this North Carolina farm.
And we all pay for subsidies (O.P.M.). Check out this state's "subsidy farms" -- no cost data or analysis supplied. Ditto for this big daddy, with boat loads of our subsidy dollars tied up in it (I sooo want one of these projects to be fully and fairly and independently audited and revealed to be a net winner for both its investors and us -- the public).
Until cost-feasible electricity storage happens, the only way Solar Photovoltaic power (what all these subsidy farms, including mine, deploy) will ever make sense is to get its cost down for 100 million individual homeowners to buy, install, and consume their own power (in which case you'll see everyone running their appliances during the daytime, thus creating an extra, conservational benefit and obviating "Time of Use" power pricing). That many consumers effectively lowering their electricity needs to near-zero will enable smart-grid-power-smoothing, I think/hope. I'm not even sure about that. But the theory is that when electricity-output-depressing clouds over one part of the landscape can be offset by electricity-producing sun over another, and the grid can real-time compensate and thus smooth net electrical flow, and peak-load daytime power needs can be more realistically supplied by solar power. I'm not even sure about that, and I've yet to see a simple, clear explanation explained to "the masses" anywhere.
But it must be, because "the masses" are the people being taxed to pay for all these subsidy farms, and they thus have a right to see if it even makes economic/ecologic sense to go down this road.
Assuming it does, then mass numbers of residential, grid-tied solar arrays should enable fewer base-load, brown power plants to be built. But of course, a lot of homeowners would have to invest in an array like mine to make such a difference.
Yet, since subsidies inflate prices (solar vendors simply raise prices to cop the spread), and trade barriers and local regulations do likewise, the way to reach that goal is to de-subsidize the entire Solar PV sector, eliminate all trade/regulatory barriers (yes, let the Asians flood us with cheap panels) and focus on other price-reducing, mass-commodity-market-growing measures discussed here.
Here's Georgia's February, 2012 report on how its tax credit policy has performed since 2008. Here's the state agency's email summary of that report:
Here's a smart fellow's take on "solar farms" (reproduced via direct paste here):
Please don't open up public lands to solar developers. Every European country that has tried supporting solar farm development has subsequently revoked support. Why have farms lost support? Simple, solar farms bust subsidy budgets. This is why Germany, Spain, Italy,France, the U.K. and the Czech Republic have all sharply curtailed and/or cancelled their support of solar farm development. Note that Germany,France, Italy et cetera have not cancelled support for rooftop solar. There's good reason for this - rooftop solar is much more cost effective. Even in cloudy Germany solar electricity costs about half as much as retail electricity from the utility (12 ct/kWh vs 24 ct/kWh). The U.S. solar market is headed in the same direction. Despite the best of intentions, BLM is subverting the natural and rational course of development for solar by encouraging an unsustainable build out of farms.
The mega-solar crowd doesn’t promote their imagined future out of green righteousness – it’s pure greed. The public at large may currently support solar farm development but that’s only because they don’t yet understand all the hidden costs. Each new transmission project or upgrade that goes in to accommodate an extra gigawatt (GW) of solar farms will cost one to two billion dollars (See Sunrise Powerlink). Rate payer will be on the hook for these unnecessary transmission costs. Consider also that the above market Power Purchase Agreements associated with solar farms will cost rate payers another one to two billion dollars in extra electricity charges over the 20 year life of the PPA deal. Each GW of solar farm will also cost public coffers a front loaded 600 million to a billion dollars in lost tax receipts due to the 30% investment tax credit. Please don’t encourage this irresponsible waste of money. We shouldn’t be making it any easier to build these farms – we should be making it harder.
I’m a die hard pro-solar guy but I believe solar belongs on school rooftops, on homes, over box stores and throughout the community. When you develop solar locally it puts solar in the public’s eye and in the public’s mind – this leads to knock on adoption.
Again, I understand that the BLM has nothing but the best of intentions here but you’re playing with fire and the public is going to end up getting burned. Leave our wild lands be. Please don't open up public lands to solar developers.
The BLM will be taking public comments concerning the competitive leasing of public lands until February 27th. You can submit a comment here.