Is the solar energy bubble about to burst?

SolarCity workers install rooftop panels. (R-J photo)

A week ago Obama came to Las Vegas for Harry Reid’s traveling planet salvation show and choir singing to proclaim, “Solar isn’t just for the green crowd anymore — it’s for the green eyeshade crowd, too.”

On the day after his administration announced $11 billion in new loan guarantees for renewable energy projects, Obama was claiming that renewable energy was competitive in the marketplace. If so, why did he announce all those loan guarantees?

Today The Wall Street Journal has an editorial under the headline “Big Solar’s Subsidy Bubble: Companies cash in on tax credits and ‘net-metering’ schemes.”

It points out that solar panel installers are making a big push partly because panel prices have fallen but mostly because in December 2016 the federal 30 percent tax credit falls to 10 percent and numerous states, including Nevada are rethinking generous net-metering programs, which will make solar difficult to produce a return on investment.

Of particular concern are solar leasing companies, such as SolarCity, which got a $1.2 million taxpayer handout to open an office in Las Vegas and compete with existing taxpaying solar installers.

“Here’s how this dubious business works,” the editorial states. “Solar-leasing companies install rooftop systems (which often cost tens of thousands of dollars) at no upfront consumer cost. Homeowners rent the panels for 20 years at rates that typically escalate over time but are initially cheaper than power from the grid. Investors get to pocket the myriad state and federal subsidies while homeowners are promised hundreds of dollars annually in savings on their electric bills.”

The catch, according to WSJ, is that the teaser rates could increase if government subsidies are reduced.

Several members of Congress this past year asked the Federal Trade Commission to keep an eye on solar leasers who might be using “deceptive marketing strategies that overstate the savings” and “understating the risks.” (Never mind that solar leasing companies can put a lien on the house.)

NV Energy currently has a requested pending before the PUC that would cut the amount of credit for solar power uploaded to the grid from rooftop panels from 11.6 cents to 5.5 cents, a rate that could result in solar panel users paying more for electricity — when capital cost is included — than those without solar panels.

The WSJ editorial concludes with this pithy remark: “What does it say that the President is using his bully pulpit to abet an industry that is essentially fleecing the American public?”

 

Advertisements

12 comments on “Is the solar energy bubble about to burst?

  1. Rincon says:

    Once again, complaints about solar subsidies (with some justification), while the mandatory silence over fossil fuel subsidies continues to be observed.

  2. Winston Smith says:

    Fascism at its finest…

  3. Patrick says:

    Just watched “The safest place on earth” yesterday. Documentary about nuclear waste disposal.

    One lesson, and it applies times 10 to electricity generated through burning coal, is that the actual “costs” of generating electricity through burning coal (and with atoms) is never paid for by the customer and instead is passed on to every breathing person in the world.

    The nuclear industry recognized from the beginning that waste disposal presented a problem but they also knew that trying to pass he true cost of their product on to the consumer was going to be ruinous because it would make it too expensive for them to sell. But I don’t remember many conservative voices calling for a shut down of nuclear plants during their heyday.

    Likewise, though the destruction visited on the world by burning coal, and then dumping the poisonous waste which inevitably destroys the environment, in some cases for millions of people, is never added to the cost of the electricity generated, and so, relatively speaking, the public never gets to decide, on a cost basis, what the best source of power is. Instead, we get arguments, from the vested interests (fossil fuel interests that is) telling us that all the other ways are too expensive

    Reminds me of the campaign John d. Rockefeller launched against electricity when his money was in kerosine.

    Nothing much changes…for industry does it; all a bunch of lies to ensure their money keeps flowing.

  4. No one ever counts the lives improved and saved by having to cheap electric power.

  5. Patrick says:

    But those benefits are also achieve through power generated by any fuel. It’s the costs that never get added though.

  6. Steve says:

    Off topic but too good to not share;

    From;
    http://www.millercountyliberal.com/news/2015-08-19/Opinion/New_American_way_of_life.html

    *THE NEW AMERICAN WAY OF LIFE…GET ON BOARD
    For a guy and his girlfriend with two kids all you have to do is follow these proven steps:
    1. Don’t marry her!
    2. Always use your mom’s address to get your mail.
    3. The guy buys a house.
    4. The guy rents out house to his girlfriend with his 2 kids.
    5. Section 8 will pay $900 a month for a 3 bedroom home.
    6. Girlfriend signs up for Obamacare so guy doesn’t have to pay for familyinsurance.
    7. Girlfriend gets to go to college for free being a single mother
    8. Girlfriend gets $600 a month for food stamps.
    9. Girlfriend gets a free cell phone.
    10. Girlfriend get free utilities.
    11. Guy moves into home, but continues to use moms address for his mail.
    12. Girlfriend claims one kid and guy claims the other kid on their taxforms. Now both get to claim head of household at $1800 credit.
    13. Girlfriend gets $1,800 a month disability for being “crazy” or having a “bad back” and never has to work again.
    *This plan is perfectly legal* and is being executed now by millions of people.
    A *married* couple with a stay at home mom yields $0 dollars.
    An *un*married couple with stay at home mom nets $21,600 disability+ $10,800 free housing + $6,000 free obamacare + $6,000 free food + $4,800 free utilities + $6,000 pell grant money to spend + $12,000 a year in college tuition free from pell grant + $8,800 tax benefit for being a single mother = $75,000 a year in benefits !

  7. Rincon says:

    Compared to the money the billionaires have sequestered for themselves, the so called extra coast of renewable electricity is peanuts, but in the conservatives’ world,clean air and water is far less important than lining the pockets of the rich.

    “The New American Way of Life” is cute, but not too well thought out:

    1) It says the scam is legal, but it actually requires the commission of fraud against the government on several levels with a risk of imprisonment. Not to say that some idiots don’t actually do this, but being convicted might just lead to permanent government dependency because jailbirds don’t do so well in the labor market..
    2) #7 doesn’t fit the MO of a parasite. If she doesn’t want to work, why would she take a full class load at a college?
    3) #6 doesn’t require Obamacare. It is more likely to be through Medicaid, although it won’t work if they find daddy. Still a scam though.
    4) Speaking of daddy, from what I understand, the state is pretty diligent about tracking down the fathers of children born to single mothers, so good luck keeping any of the proceeds when they catch up with you, as would in Illinois when you renew your driver’s license for example.
    5) Rincon’s’s proposal prevents all of this if we would just insist on it from our elected officials: Anyone who gets money from the government should have to work for it or at least put in the time. Do that and the parasites will all scamper away like cockroaches. And the mother needs one more government freebie: an IUD. Somehow though, I never hear Conservatives support these ideas. Too bad. They seem pretty conservative to me.

  8. bc says:

    I like wind power, drove through Iowa and Nebraska last weekend and passing miles of wind generators. In west Texas between I-10 and I-20 there is a hundred mile stretch of windmills as far as you can see. Power being generated with no fuel cost, no pollution cost, only capital and transmission cost. Wonderful to see.

    Bad part of wind powered generators is the still wind at sundown and throughout the night, the lack of wind many times at mid winter when it is the coldest (and power needed the most), late summer afternoons and other times when the wind stops but power needs keep right on going.

    Solar is the same, great home based and industrial presence but never to be more than a niche player in the Southwest. Not enough sun in other places, here in the upper Midwest we can go weeks without seeing the sun. Even the South has likely too much cloud cover to begin to make solar power cost effective.

    People can talk about the evils of fossil fuel, the subsidies, (what subsidies) the environmental and military cost we pay as a society to have available the energy to power our culture. But alternative energy will never be more than a niche market. Figure out a way to have the energy we need from alternative sources, whatever the weather or time of day and we will talk.

    Energy to power our society needs to come from an energy dense substance or process. Currently that is fossil fuel or the ultimate energy dense substance, nuclear energy. The energy in this density must be accessible continually and at a level to provide the base energy supply needed to power our society.

  9. Winston Smith says:

    As I sang growing up in Seattle, “Roll on, Columbia, roll on”.

  10. Rincon says:

    I agree that eliminating fossil fuels entirely from electricity generation is not a realistic goal at present, but defeatism rarely gets us anywhere. Iowa produces over 20% of its electricity from wind and Denmark is now at 39%. Neither seems to be suffering greatly for it. That being said, I only advocate wind and solar for a small portion of our electricity for now, say 10% so that we can further develop its potential. Isolated areas should definitely get off the grid where feasible. I visited a ranch in Australia considered too remote to serve. The owner said their backup diesel generator used only about 25-40 gallons a year and their power was reliable. The system saves the cost of building and maintaining about 15 miles of power lines. Conservatives sometimes advocate socialism though, such as laws mandating that utilities split the delivery charges evenly among their customers. Here in the U.S., we run the lines and make the people in town pay for it.

  11. bc says:

    There are areas in rural Nevada that are off the grid, for the very reason you state for your Australian friend. People in these areas have been using solar energy with battery backup and 12 volt appliances for years. Most that have power are supplied by co-ops that buy or generate their power and sell to their members in an arrangement that stretches back to Roosevelt’s Rural Electrification Act of the 1930s. I lived in Eureka at one time and we bought our power from a co-op.

    So Rincon, do you believe that rural electrification was wrong? Personally I think that by overcoming the technical hurdles that came with sending power over long lines to farms and small towns, the regional grid systems with national interties became possible.

  12. Rincon says:

    Rural electrification was definitely socialistic, but also definitely worthwhile at the time. Even a Conservative might break down and admit that the free market would have been far too slow to get electricity to rural areas. Today though, the cost of solar and wind have decreased to the point that they are cheaper than the grid in many outlying areas. Conservatives believe that solar and wind should pay their own way without government assistance. It would be hypocritical of them not to believe that after all of the government assistance ranchers have had for their electricity over the years, it’s time they graduated to paying their own way. But of course, it’s just barely possible that some Conservatives are capable of hypocrisy, especially if they are ranchers.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s