solar


asks Christina Blizzard.

The wisest plan is to push ahead with a big honkin’ nuclear plant. They don’t spew fumes. But good luck convincing the eco warriors that nukes are green.

Now gas-fired plants are on the do-not-build list.

That leaves us with windmills, solar and a couple of hamsters running around on a treadmill to keep the lights on.

Is it any wonder, electricity prices are going up?

It was only a matter of time:

Japan files trade dispute over Ontario solar power rates

 

GENEVA — Japan has initiated a trade dispute against Canada related to renewable energy equipment in the province of Ontario, the World Trade Organization confirmed on Monday.

The Japanese mission to the WTO said the dispute centres on guaranteed long-term pricing for solar and wind generators made with a certain percentage of locally-produced components.

Some industrial strategy.

This is just looney:

Canadian and provincial governments could spend $2.4 billion to build a large scale solar photovoltaic manufacturing plant and then give it away for free and still earn a profit in the long run, according to a financial analysis conducted by the Queen’s University Applied Sustainability Research Group in Kingston, Canada.

Queen’s University Mechanical Engineering Professor Joshua Pearce conducted the study — to be published in the August edition of the academic journal Energy Policy — to find out if it makes economic sense for governments to support solar cell manufacturing in Canada. He was surprised to discover the answer is an overwhelming yes even in extreme situations and feels governments should be aggressively supporting this industry to take advantage of the financial opportunity.

This is pure junk economics. By sponsoring such research, Queen’s University’s reputation as a credible educational institution takes a serious hit. But in currying favour with the McGuinty government, the authors are clearly aware of who spreads the butter on their department’s bread. 

What I don’t get, though, is if these researchers think it so blatantly obvious that governments should support such investments, why don’t they invest their own money in such enterprises? Logically, if their assertion that the business case for solar manufacturing is sound, then providing government support is totally redundant. Private capital should be more than willing to step in to fill the void.

Ultimately, this is just another industrial policy boondoggle. While theoretically, a case can be made for government to support industry in certain circumstances, subsidizing a bunch of branch-plant, solar panel/wind turbine assembly facilities falls far short of the conditions under which that theory might apply. Moreover, in virtually every case where strategic trade theory has been applied (e.g., aerospace), the accompanying rent seeking that goes with it has dissipated any potential “social” return (hello Bombardier).

In an “Earth Day” press release today, TD Bank inadvertently makes the link as to why energy prices are rising despite being awash in surplus supplies of electricity and natural gas:

Karen Clarke-Whistler, Chief Environment Officer, TD, predicts that solar panels will be standard on homes in 10 years. “Energy prices are only going to go one way, and that is up, so homeowners will be looking for ways to reduce costs,” said Clarke-Whistler. “With an increasing number of provincial government-backed incentive programs being rolled out across the country, we expect the solar products market to evolve rapidly. We can expect product innovation, a wider choice of products and increased affordability as more manufacturers enter the market.” [my bold]

If energy costs are inevitably going up it has as much to do with governments bilking the rate payer so they can subsidize high-cost sources of energy such as solar PV.

The fact that consumers would respond to such bribes, though, is not surprising. Without the bribes, many would spend their money differently. Instead of trashing their current furnace to replace it with a subsidized, high-efficiency model, they just might hang on to it for a while longer, and spend their savings on other things. Installing solar panels on their roof tops wouldn’t merit a second look if not for the massive subsidies. And somehow TD thinks it is prudent to pile on and up the ante.

In the realm of energy, economic considerations have become secondary. The decision faced by the consumer is no longer — should I keep my older furnace and pay a little more for energy or buy a new furnance and save on my energy bill? — but how big is my tax credit?

The TD Canada Trust Green Home Poll also revealed that 66% of Canadians say that tax credits would make them more likely to make energy efficient upgrades to their homes. “This shows that financial incentives really work when it comes to encouraging energy efficient home upgrades, so we hope that our Green Mortgage rebate will encourage our customers to consider renewable energy sources for their homes,” says Wisniewski.

Once hooked on subsidies, consumers come to expect it and may even hold out in the expectation of even bigger bribes in the future. The inevitable result is that the taxpayer ends up subsidizing many choices that consumers would have eventually made anyways.

Is it any wonder energy costs are going up?

The recent announcement that Loblaws will be installing solar photovoltaic panels on the rooftops of more than 100 of its stores is not cause for celebration by Ontarians. Despite the green spin the company puts on it, Ontario ratepayers will see their electricity costs go up as a result.

“This initiative is part of Loblaw’s overall effort, through the use of renewable energy sources to reduce our carbon footprint,” said Bob Chant, vice president, corporate affairs, Loblaw Companies Limited. “We believe green energy production using innovative technologies such as these pilot projects, supports our commitment to the environment.”

[…]

Based on the success of the initial four pilot projects, Loblaw will then evaluate the next phase of roll outs.”These projects will create a new source of income for businesses while providing new clean and green electricity in Ontario — particularly on hot, sunny summer days when demand soars,” said Brad Duguid, Ontario Minister of Energy and Infrastructure. “With our new domestic content rules, these projects will also help create new green collar jobs here in Ontario as well as major economic investments in equipment and services here at home.”

Ostensibly, Loblaws is doing this to be “green.” Yet while Ontario households typically pay on average 5.7¢ a kilowatt hour for their electricity (current wholesale rates are a little over half that), Loblaws will be receiving 44¢ a kilowatt hour for any power it produces, the cost of which gets fed back into your electricity bill. (I guess that’s why they call it a “feed-in tariff.”)  So, the more power Loblaws and the other 509 fortunate companies produce, the more our electricity costs go up.

For Loblaws, this is just their latest greenwashing scheme. The company has a long history of involvement with WWF Canada, which their clients unwittingly support every time they shop there.

It’s long past time to find a new grocery store.

Spain is typically put forward by advocates of renewable energy as the country that other jurisdictions should emulate.  Yet Spain is clearly having second thoughts about its head-long rush into the renewable-energy subsidy game.

For now, electricity generation from the sun’s rays needs to be subsidized because it requires the purchase of new equipment and investment in evolving technologies. But costs are rapidly dropping. And regulators are still learning how to structure stimulus payments so that they yield a stable green industry that supports itself, rather than just costly energy and an economic flash in the pan like Spain’s.

“The industry as a whole learned a lot from what happened in Spain,” said Cassidy DeLine, who analyzes the European solar market for Emerging Energy Research, a firm based in Cambridge, Mass. She noted that other countries had since set subsidies lower and issued stricter standards for solar plants.

Unfortunately, McGuinty and company appear to be slow learners.

When it was announced in the summer of 2007, Spain’s premium payment for solar power was the most generous anywhere — 58 cents per kilowatt-hour — with few strings attached.

In retrospect it was far too high. “Everyone from all over the world was installing in Spain as fast as they could, and every biologist who could add was working in solar,” said Pedro Banda, director general of the Institute of Concentration Photovoltaic Systems, one of the research institutes in Puertollano.

Even inefficient, poorly designed plants could make a profit, and speculation in solar building permits was common.

Despite large declines in solar panel prices since 2007, Ontario is offering 44.3 to 80.2 cents per kilowatt-hour for solar PV projects under its Feed-in Tariff program. This is either very courageous or very stupid. You decide.

Let the grift begin:

Ontarians get the green light for 700 rooftop solar projects

Popular new program attracts more than 2,200 applications

TORONTO, Dec. 16 /CNW/ – Seven hundred Ontarians from Ottawa to Windsor to Thunder Bay – including a member of the popular band Barenaked Ladies – will be celebrating a green holiday season after being the first to receive offers to generate renewable electricity under the province’s new feed-in tariff program.

The new microFIT program encourages the development of small-scale renewable energy (10 kilowatts or less) from a diverse range of producers, including homeowners, schools, farmers and small businesses. It is part of a broader Ontario feed-in tariff program (FIT), the most comprehensive program of its kind in North America. FIT is also aimed at encouraging community-owned and aboriginal-led projects.

“It’s a thrill to be able to power my own lights while at the same time contributing to my city’s electrical needs,” said Jim Creeggan, bassist for the band Barenaked Ladies. “Now that the microFIT program is up and running, it makes solar a realistic option for more households. With enough homeowners on board, communities will have a greater impact on where our power is coming from. I’m glad solar power is getting out of the fringe and into the mainstream.”

I guess when one is just the bassist in a top recording act, and not the principal songwriter, one needs to supplement one’s income. But with the band’s CDs, I at least have a choice. Not so with any solar power Creeggan might generate. For that, us hapless ratepayers have the privilege of subsidizing Creeggan’s “contribution” by paying him over 14 times the retail rate.

Why not join the club and get some grift of your own?

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