A useful series on energy, and a Wish

As I mentioned in my last post, this is the time for Seasonal travel, and so, for the first time it finds us, transiently, in Western Massachusetts. Picking up the local paper The Sunday Republican I discovered tht they are in the midst of a series on Energy in the 21st Century. The series began with an article on solar power , which was followed by one on nuclear power and then by one on the use of coal. The latest, which first caught my attention, is on power from water. There will be two more in the series, one next week on biofuels, and then one the following week on wind.

The articles bring a local business view to discussions on how to cope with the changing climate and the increase in the price of oil. The solar article, for example, quotes a local business owner who has invested in solar panels
The dark side of power from the sun is that it is costly. Despite decades of research to lower its price, each kilowatt-hour costs roughly two to three times as much as the same amount of electricity produced from fossil fuels in much of the country.

Even with about half the $140,000 cost of Lessels' rooftop panels paid for by state and federal grants and tax deductions, he believes it will still take him eight to 10 years to earn back their cost through lower electric bills.

The article notes also that the DoE Solar America Initiative have the goal of closing the price gap between solar and grid power by 2015, although they quote a Vice President of SunPower Corp as anticipating that the gap may be closed by 2012. The path is anticipated to be:

About 15 percent of the cost reduction for them will come from normal improvements in cell efficiency through basic research. Another 20 percent will from lower costs for silicon, achieved through long-term supply contracts and an easing of the current global shortage of silicon. Another chunk will come from lower costs due to the production of a greater numbers of panels, so-called economies of scale. But at least half the cost reduction will come from improving the efficiency of the delivery of solar panels from the factory to customers, the process that includes transportation, sales and installation.

It should be noted, however, that part of the gap closure is anticipated to also come from a significant increase in grid power costs.

The nuclear energy study highlighted the discord between those who favor nuclear power and those opposed, noting that there are now rising arguments for power, being made by earlier opponents, and quoting James Lovelock:

He said in a published essay that greater use of it could help prevent the worst consequences of global warming brought on by the burning of fossil fuels, including "intolerable and lethal heatwaves and sea levels rising to drown every coastal city of the world."

He wrote, "I wholly support the 'green' wish to see all energy eventually come from renewable sources, but I do not think that we have the time to wait until this happens. Nuclear is the only practical energy source that we could apply in time to offset the threat from accumulating greenhouse gases."

And on the other hand, there are some still opposed

To say that it does not contribute to global warming "is like saying cigarettes have no calories," said Janet S. Domenitz, executive director of the Massachusetts Public Interest Research Group.

.The next article similarly looks at environmental concerns and offsets the optimistic claims for cleaner coal with a recognition of the current problems that the fuel source has created

Coal has long been a four-letter word for environmentalists, though. While it accounts for about half of the electricity produced in this country, coal-fired power plants also account for more than a third of the U.S. releases of carbon dioxide into the atmosphere from all human sources, including cars and trucks.
In addition, the plants produce sulfur dioxide gas that becomes an ingredient of acid rain, which has spoiled lakes and ponds throughout New England. And they produce airborne mercury, which can make fish inedible. It points out, however, that companies are moving to remediate concerns
In 2006, FirstLight Power Resources Inc. bought the Holyoke plant as well as hydropower stations at Turners Falls and Northfield from Northeast Utilities. In September, the company announced a $57 million project to reduce pollution at Mount Tom Station. Over the next 20 months or so, modern pollution control equipment will be added that is expected to reduce mercury, sulfur dioxide, hydrochloric acid and hydrogen fluoride pollution by 95 percent.

Similar results are reported for the two IGCC plants operating in the US, though they are not yet sequestering the carbon dioxide, a technology which is also reviewed in the article, and where there is an optimistic projection for the future

David O. Dapice, an associate professor of economics at Tufts University who has studied the economics of these new coal-burning technologies, said that the cost to sequester carbon dioxide currently is estimated at about $100 to $300 per ton but research at the Department of Energy and elsewhere could reduce this by 90 percent in less than a decade.

The articles seem to take no sides in debating some of the issues that confront the need to find alternate sources for oil, and, as I have tried to capture, have some illustrations of some of the issues that must yet be addressed.

I started reading the series because of one of the comments in the article on hydropower. The articles mention the opposition that has arisen to many of the sources proposed, and local hydropower is no exception. The Holyoke dam has been generating power from the Connecticut River since 1884, and there were a number of such plants around the state. However some of these are no longer used, and so there is an environmental move to have them removed.

In all of New England, there are perhaps 500 megawatts of power left to be coaxed from good hydroelectric sites, primarily abandoned or unused dams, on rivers and streams (the equivalent power of one large coal-fired power plant).

And that's assuming environmentalists will not fight the effort, according to Peter B. Clark, president of Swift River Hydro in Hamilton. In fact, the campaign now among environmentalists is to remove unused dams, he said. . . . . There may be 30 or 40 towns that have old dams that no one knows what to do with.

The article ends with a discussion of tidal power.

The debate between those espousing local environmental concerns and those that face the reality that today’s population needs significant sources of power is likely to get stronger in the New Year, as the supply problems that we have discussed here get more obvious. Over the past couple of years local papers have started to pick up on this concern, since it is the local communities that are starting to bear the brunt of higher costs. And the discussions such as those in this series, are noting that not all people can be satisfied.

The concerns are not new, I was reading today "Defining Women's Scientific Enterprise: Mt. Holyoke Faculty and the Rise of American Science" by Miriam Levin and was struck by two quotes, one by the founder of Mount Holyoke College, Mary Lyon.

Enthusiasm for nature had a special status in the salvation experience primarily because it was the context in which Mary Lyon remembered she had come to feel redeemed. Her story of standing on the summit of a hill in Buckland, Massachusetts, on a beautiful Sabbath afternoon in the spring of 1816, was well known within the Mount Holyoke community and revered as a kind of myth about the founder. There, transfixed by the glorious, light-filled landscape, she was filled with a sense of compassion for "a perishing world" and a desire to work to save it.

The second was by Edward Hancock, who became president of Amherst College in 1845.

As a contrast, Hitchcock connected the newly prosperous middle-class desire for showy finery to their enthusiasm for diverting the Niagara River from its natural bed. These were understandably people "whose attitude towards the land is wholly utilitarian and exploitive." Both represented the corruption of God's natural law.

Those of us who have read, and then enjoyed the movie versions of “Lord of the Rings” can see the concern for the land and its inhabitants that Tolkein expressed, where the industrial users, the miners and forgers of metal, were represented as the evil ones.

It is a conundrum that we must learn to address, that of properly providing for the needs of the people, while concurrently protecting the environment to the extent that we can. To resolve the issues requires communication, and effective communication requires knowledge. And that is why we are here. As we come to the end of a highly productive and informative year that the many contributors to this site have helped happen, let me again gratefully thank you all., but most particularly to Prof G, and Super G, without whom we would not be here, and to Leanan, who continues to be an inspiration (perhaps next year I'll essay a card).

I wish you all Success and Prosperity in the New Year, and may you all have enjoyed a happy and restful Holiday Season.

"$140,000 cost of Lessels' rooftop panels..."

Is he running a PV powered blast furnace, or something? Sheesh, couldn't live with a little less energy maybe?

It is a small business, and a restored old house, and I am not sure how much of the cost could be allocated where. You can see a photo of the site (which appears to just have solar panels on the roof) here.

It's a 15kW system so $9-$10 a watt is what solar costs right now. A home would use a fifth of that. Unless it is Al Gore's home.

The average home uses about 900 kWh http://www.epa.gov/climatechange/emissions/ind_assumptions.html, so you are saying a 3kW system produces 900 kWh in a month in Mass?

I'm saying Massachusetts need to install more compact flourescent lightbulbs.

Mass was 46th in per capita electricity use in 2005, http://www.energy.ca.gov/electricity/us_per_capita_electricity_2005.html.

California was 51st. Which just means we import our electricity from other states. Someone who is using 900kWhs a month doesn't need more solar panels. They need energy star appliances.

Retail sales include imports, California has low usage due to high rates and mild climate.

About half of the $140,000.00 system paid for by subsidies leaves about $70,000.00 out of pocket cost.

Paid off in 10 years max.
30 year system life.

So, this guy is very likely going to make a 200% return on his investment! (probably more...)

When will people realize that PV is a long term investment, not a get-rich-quick scheme?
When will people realize that there is absolutely ZERO return on "investing" in an electric utility bill?

"When will people realize that PV is a long term investment, not a get-rich-quick scheme?"

Good point, and when will people stop comparing
the prices of green renewable energy to brown
fossil fuel energy, which is subsidized by our
tax money and our future generation's quality of life.


A 200% return over 30 years works out to 3.73% a year. If instead of making a highly visible political statement (in large part at the taxpayers expense) he invested in treasury bonds he could have produced a larger return on investment. The current yield on a 30 year bond is 4.68%.

So a tax deduction is a taxpayer expense? It is probably not nearly as large as the mortgage interest tax deduction on a house. The grant came from the utility renewable energy surcharge. You should figure in the devaluation of the currency in your arithmetic as well.

Most of us agree that energy in all forms is going to become more expensive. IMO, this will be a significant rate, something like 5% a year, even after adjusting for devaluation of the dollar. I think it is reasonable to say that there would then be about an 8% or 9% return on a dollar spent on this solar energy system, compared to paying the electric utility.

One of these days, I will have to do a comprehensive post on the economics of solar vs. grid power. I have yet to see a single article in a newspaper or magazine that got it right...and don't even get me started on the hatchet jobs that the vested industries do on it that get written up by dumb journalists as "expert opinion." Most analyses of solar PV are as benighted as saying that "we have 50 years worth of oil left"...as if it were not a dynamic involving multiple factors.

Here's the bottom line, without getting into all the details. As my experience is in the California solar market, I will cite the numbers that apply there...your local incentive programs, and the economics thereof, may vary.

For residential solar systems, the system will typically pay back the original investment in 11 to 18 years (14 years on average), depending on the size, the site, the equipment, and other factors. Over 30 years, the system will return 2x to 3x the original investment.

For commerical systems, it will typically pay back the original investment in 7-12 years (can be as low as 5 with special depreciation), again depending on all of the above factors, and then some (special rules for business and other incentive programs). Over 30 years, the system will return at least 3x the original investment.

But the modules will produce power for as much as 100 years, given an average decline of about 0.5% per year in production (although it's not really linear), not 30 years! We typically use 30 years for the financial analysis simply because it maps well to a mortgage (which is usually used to finance the system), not because the system is dead in 30 years! In fact, the modules have a 25 year warranty, which means that they will be producing 80% of their rated output after 25 years...and bear in mind that their actual output begins life at around 95% of their rated output.

Further, the payback period and the ROI are based on assumptions about the rate of general inflation, the rate of grid power inflation, the terms of the loan, etc. Obviously, the ROI is going to be better if you pay cash, not finance with a home loan.

When all factors are properly taken into account, and the economics worked out over, say, a 50 year time scale, the system will typically pay for itself 3x to 5x over. And a peak oil-aware estimate of the rate of energy cost increase over the next 50 years is going to produce a much different ROI than a historical average rate of increase.

Whereas grid power pays for itself...uh, never.

And no one invests in a solar system exclusively for its return on the investment. That's just silly...there are lots of reasons to buy solar PV. Nor does the typical buyer make the investment as a "highly visible political statement" (one can buy much more visibility for one's political statements with that kind of money!).

Not at all. In fact, in my considered opinion, the best reason to invest in a solar system is cost insurance. Effectively, you are buying the next ~14 years of power up front, and amortizing that cost over your home loan, hopefully at a fixed rate. After that, you get several decades of FREE power. As opposed to being forever subject to the vagaries of the grid power markets.

For those who resent the investment of taxpayer dollars in solar, have you considered that the taxpayer is already on the hook for many different externalized costs of fossil fueled grid power, including the effects of acid rain (lost revenue & resources in forests & fishes), the health costs of air pollution, the numerous hidden subsidies to fossil fuel industries, etc. etc.?

And for a final thought, for those who think "Ehh, I'd rather spend that $25K on a new kitchen with granite counters and SubZero appliances," let me pose this question: When will that investment pay for itself?

Probably never, unless you're somehow in a housing market that's still going up. But that never seems to enter into the typical homeowner's calculus. Yet, they are quick to say that 14 years to recoup their original investment on the solar system is "too long."

Go figure...No, really, I mean it: Go figure!


Obviously, the ROI is going to be better if you pay cash, not finance with a home loan.

Not necessarily, if you have the cash in other investment vehicles you can use leverage for the solar investment and use the mortgage tax deduction to reduce the cost of borrowing. Especially if your ongoing investments are taxed at a capital gains tax rate for the most part. Meanwhile you have offloaded the currency devaluation risk to the lender, at a very low rate.

True, but that is a more complex financial arrangement than most homeowners would contemplate. I was talking about a straight purchase consideration. Obviously, the more financially sophisticated and well-heeled one is, the more options there are, and the more opportunity there is to shift the risk onto another party...

If you are going to assume that most people are financing system installations as part of a 30 yr home mortgage, you need to include the interest on that portion of the mortgage in your calculations.

If we use the above scenario....a system that costs the homeowner $70,000 on a 30 yr note at 6% (being extremely generous there) the total cost of the system to the home owner is $151,083.60. Just the monthly payment on a $70,000 mortgage at 6% is $419.69.

A family would have to be using one hell of a lot of grid power to see payback on that within 10 years. Is your electric bill $419 a month? Mine certainly is not.

BUT, we have not included all costs yet because we can assume that there is a lost income there as well since they are throwing $419 a month at a solar array for 30 years. Instead we will say that they invest that money. As we were conservative when it came to the interest rate for the mortgage, we will be conservative when it comes to the return on that investment and say they only pull 4% compounded twice annually. That comes to $142810.62 in lost income over those 30 years. That means that the system cost is $294,318.71. Still a 11 year payback?

This is why more people do not invest in solar systems for their houses. It is a stupid investment that will not and can not possibly show a return in an individuals lifetime and it is CERTAINLY not going to show a return of 2-3x in 30 years. If we stick purely to the economics of the thing, you would have to be borderline retarded to go for it. Luckily for the solar industry, that adequately describes most american consumers who do not stop to think about what adding an extra $70K to their mortgage actually costs them, or what they could do with that money even at a low rate of return.

Even on a $25K system total cost over 30 years is $134072.35. No 11-18 year return there, either, and you have to live in the house the entire time in order to get any benifit at all, because the odds of getting total system value out of it if you sell it are somewhere between slim and none.

Probably a grid connected system is closer to a 30k mark, this is pretty generous and assumes you have not taken steps to reduce your consumption. That's a payment of 179.87 a month. Since you are able to write off interest due to the fact it is a home loan, it is pretty close to $120 a month. That's not a bad electricity bill for someone who is not conserving. With the normal steps people take here you could get it to half that. It will not go up with inflation.

Solar power is a lot less costly than most think and Germany has found an effective answer with Feed-In-Tariffs (video). Essentially they de-monopolized power generation. Anyone can sell spare solar generated power to the grid at a small margin.

The result is that Germany, same latitude as Manitoba Canada, the size of two mid-western states has more solar collectors than the entire US. These 300,000 installations are economic lifeboats. Germany now generates 12% of their electrical needs from renewable sources. They are ahead of the goals by allowing a free-market approach.

California's Energy Commission just recommended California adopt this free market approach. They noted California's centralized, utility based effort has resulted in 242 mega-watts of renewable generation be added in the last 5 years. Germany's free-market approach resulted in 4,000 mega-watts being added last year alone.

It will be hell getting it in place. The Enron based free market solution for California energy was neither free nor a market.

I agree with the implementation but I fear it will not be accepted due to the last "free market" mess.

Deregulation was a far cry from de-monopolization of power generation.

Those communities that adopt will be build economic lifeboats. Those that do not, will not. There is not enough materials for everyone, so my recommendation to people is to act while you can.

I was asked if I was a futurist in predicting that oil will increase in price until the entire market becomes unstable. In thinking about this I would have to say that it is more historian. If we were on the Titanic, here are the signs:

  • Iceberg warning. 1956 Hubbert warned of Peak Oil.
  • Iceberg sighted. 1970 US Peak Oil
  • Impact and Hull breach. 1973 Oil Embargo, fragile infrastructure
  • Deck Tilt. 2002-2007, 5-fold increase in the price of oil.
  • Breach of water-tight inner compartments. May 2005 Peak C&C's followed by 30 months of plateau.

There are not enough lifeboats. If solar installations are local, economic lifeboats, what is the payback on having one.

Solar panels are made of sand, of which there is a plentiful supply. There is currently a shortage of plants to reduce and purify silicon but this is changing. What other material shortage do you see?


If solar panels were free............
So just an ignorant guess would be, in the short term money, in the medium term money, in the long term probably money.

In addition to sand you need a lot of other things, as you well know, factories for a start. And factories, just like new refineries or power stations don't grow on trees or suddenly appear. You need happy investors with loose money to take long term risks with relatively low returns. And I don't see many of those around. And bringing up a factory from drawing board to full production usually takes at least a couple of years.

So BillJames's point is valid. We should've started heavy investment and subsidies to the solar industry 15 years ago, and now we are in a situation where if suddenly all the communities realised they were soon going to be in trouble because of peak oil, the market would not be able to supply enough materials ie. solar panels to meet the demand.

So to add to Bandit's comment; I think we are short of two things: money and time.

Although solar panels on your roof are nice for making up some electricity for your tv and computer, it neither replaces the oil used in heating for your house, or the other much more essential needs you will have in a peak oil situation, how to transport yourself to work, and where your food comes from.

If I had 140,000 USD to spend, I'd invest in a communal project to fit mine and neighbours houses with multi-fuel burners that can take anything from wood pellets to corn. And then set up a co-op to operate a community silo that would buy which ever fuel was currently the cheapest. In addition I would table a motion at the home owners association that all lawns would be banned and turned into potato fields, and... oh no, here i go again...

Actually in the Mid-Atlantic you could come pretty close to maintaining you house HVAC with ground source heat pump and solar. I have plans to do the same except adding a kW or 2 of wind, since my strongest energy pull is on cold windy nights. And yeah, you still can't drive anywhere or get food without oil.

With solar we have a kind of chicken'n'egg problem. Currently the demand isn't there to massively ramp up production. And when the situation turns sour, there won't be enough time to massively ramp up production. Nor will people necessarily have the economic means, or concentration to make informed investments with the all the other problems going down.

Ideally there would be a nice slow linear curve where energy would get more and more expensive over the next 10 years, with no major economic drama, and we'd eventually end up with large enough demand to warrant mass production. Unfortunately the combined problems of economic meltdown and the consequences of peak oil we see in the horizon are going to be very non-linear events.

Demand-supply market mechanisms perform very poorly with non-linear systems where there is no prior feed-backs to start correcting the market before irreversible events occur. Peak oil is a typical example of this. I was recently challenged to explain why the futures markets we're flooded with long term contracts for this expensive future oil and that since I hadn’t bet my life savings on the market, that was enough proof that all my peak oil arguments were bogus.

I still don't have an answer to people who cannot decide which is the real world - the markets - or physical reality.

Sorry for replying to myself.

you guys are missing the boat, investment interest in wind, solar and other alternative energies are exploding. look at the numbers.

Solar is exploding and will pickup speed as Feed-in-Tariffs are implemented. Germany is an example.

There are several ways to look at payback.

First, in our solar powered mobility networks we expect a 1-4 year payback. The first will come on line this Spring. The payback is against congestion relief and cost of mobility.

Second, if you need a lifeboat, what is the payback of not having one?

Time is limited.

You can invest all you like, knowing when to take your profit might prove difficult.

If global debt, contracting economies and collapsing consumerism can provide investment capital, then the term investment is a different animal to what I have grown to accept.

The production and sale of consumer items like solar panels requires a market. Where that market will come from in a world battling debt, fuel and energy shortages and unemployment, to me is a large concern.
Consumers purchasing solar now, just restricts the amount of
purchasing power for other consumer items in the market place and further exacerbating the effects of the recession on business.

Solar panels usually require, cables, regulators, inverters and batteries and installation.
Depending on the quality, the cost of those items amount to 1x5 times the cost of a solar a panel. I speak from experience because I purchased a 210 watt, 24v panel and accessories.

If you expect the mass production of solar equipment and accessories to stimulate the economy and stave off or repel the consequences of peak oil then I disagree.

In the coming years there could be a thriving market for second hand panels, as people sell them to purchase food.

Sounds like you have an atypical, very small, off-grid system. The economics of that are very different from a typical grid-connected system, say a 2.5 kW system, where the balance of system components (everything but the modules) usually accounts for about 15% of the total system cost.

If anything, in the coming years those who have their own solar power generation will be far better situated to be able to buy food than those who are still at the mercy of the utilities!

I have a 1kw grid connected system cost about 5k after rebate, that included all fixtures, accessories and installation.

I also have a 30 tube, 300 litre, solar hot water system.

The single panel I have is to charge a couple of 12v batteries connected in series and an 8000 watt inverter. I think I need another panel, possibly two, one is too slow to charge the 140 amp hr, deep cycle batts.

The thing is I didn't buy to save money,(although I will after the initial purchase cost is discounted) I did it for peace of mind, a little insurance, if TSHTF sooner than later.

ransu, when you say "Currently the demand isn't there to massively ramp up production," what are you basing that on? Because most of the solar companies I follow doubled their production last year, and will double it again next year, and add at least another 50% in 2009...or is a 100% per year growth not "massive" enough for you?

No, not massive enough nearly. It is quite normal for a small emerging technology to double in a year, and keep doubling for a few years. Any number of toys or gadgets on the market do it every year. To gauge solar's and other reneables significanse, we'd need something like the Megaprojects for alternatives which would list the existing and projected production increases in numbers and compared them to actual energy demand of the whole economy. My hypothesis is that the most dramatic projections for solar growth in the coming years are hype created by solar manufacturer's to entice investors. Looking at how many factories are actually being built would show a more concervative attitude of the solar manufacturers. They know that demand growth for solar will soon start to settle.

Solar panels as a commodity on the market are still a luxury item. They have a large initial cost and long time for return on investment. Most people who currently buy them, have some sort of image thing in mind, going green and all that. People who buy them as investments view them more as being able to 'pay ones electricity bills in advance for the coming years with a fixed price'. Both of these groups are affluent people with so much money to spend they don't know what to do with it. So they buy solar for instance. There is no significant demand from the 'common consumers', hence solar is still a luxury item and hence the demand for them will soon start to normalise, as would happen to any new luxury good on the market.

For solar to have a significant impact on peak oil, its growth would have to be something out of the oridinary. How to gauge what this kind of growth would for example compare solar to the rest of the energy economy, not to itself, as I pointed out that doubling can also be 'normal'. What we are looking here are statistics for example what procentage of households have solar installed, and how many are thinking of investing in a system in the coming year. Or to put it simply, how many car magazines are there in the US versus how many solar magazines there are.

Finally, may I ask, in what way does solar solve peak oil? Solar makes small quantities of electricity for household electrical appliances. Oil is the most abundant energy dense fluid in existance, for which the whole of our civilizations infrastructure has been geared to work with.

ransu, where are you getting your information? In the field, I see very little support for your many unsubstantiated assertions. Your "hypothesis" seems ridiculous to me. Based on the investments that solar manufacturers are now making and planning, they are certainly not anticipating demand for their products to settle. In fact, they're growing their businesses as fast as they possibly can, limited primarily by the very large capital investments required. As far as demand goes, the sky is the limit for the foreseeable future.

And solar PV is certainly not a "luxury" item. In California, even for people of modest means, when they pay for the solar system using their home equity loan, they can be cash positive in the first year and pay nothing out of pocket! E.g., they will pay less on the debt service than they would to the utility starting in the first year. I have sold many systems to people who sought me out, and who live on decidedly modest incomes...and they ultimately did it because it made financial sense, not just because they wanted to make a statement. There is plenty of demand from "common consumers!" The only things we're missing are an adequate supply of equipment, and stable, predictable, uncomplicated incentive programs (like a feed-in tariff)!

What we are looking here are statistics for example what procentage of households have solar installed, and how many are thinking of investing in a system in the coming year.

Please share those statistics....which surely have absolutely nothing to do with the ratio of car magazines to solar magazines (?!?)

I don't believe anybody in this thread said that solar will have a significant immediate impact on peak oil...I certainly didn't. But in fact, given another two or three decades of intensive investment in this emerging technology (which at this point, I think is a given) AND intensive investment in electrified transportation, I think it could make a substantial impact. Maybe not as quickly as we like, but it will no doubt be one of the many components of the solutions in the future...


Thin film solar is only about 10% efficient but can be processed in large quantities.

If the government wants a Manhattan Project, it should be to build solar foundries.

There is some risk of depleting the doping elements.

higher oil prices will solve peak oil and the resulting energy crisis.

Renewable Energy Stocks Sector Close Up on Solar Stocks 2007; Analyst Upgrades and Industry Experts Agree "It Is Just the Beginning"

"Momentum created from oil prices closing in on $100 a barrel, global revenue growth within the sector and analyst upgrades have resulted in strong percentage gains in solar stocks."

Bandits already stole my point I was going to make on demand destruction but I'll elaborate it further..

High oil prices will affect all parts of the economy. Alternative energy technologies are no exception. As oil gets more expensive, manufacturing and distributing solar panels will also be affected, offsetting some of the demand increase due to price difference between oil and solar.

And solar does not directly replace or compete with oil. Solar makes electricity and competes with the grid, whose main inputs are coal, gas and nuclear. The government will continue boosting the economy by trying to keep grid electricity down to sustainable a price. In a deepening economic recession, it is more likely that the subsidies meant for alternatives are spent on coal, gas and nuclear.

All would look bright if the economy of the world could sustain above 100 dollar a barrel oil prices for a few years yet, giving time for alternative energy systems to start being mass produced, and becoming consumer commodities like cars. Unfortunately the world has spent and debted itself to the limit. All the money we could've used for these things has instead been spent on inflated chip'n'plasterboard failytale castles and useless consumer junk.

The combination of over extended economy barfing out its excessses and ever higher oil prices from peak oil, will cause the demand for everything, especially luxury items like solar system, to be destroyed.

I used to live along (or near to) the Chippewa river, where the lions share of the midwests hydropower was generated. Fishing, and boating were major recreational activities, and the lakes, and flooded rivers were very popular. As long as
the areas that would be flooded are not populated, most communities would consider such developments as positive things for the community, quite apart from the power generated. And lake/riverside real estate carried a significant premium.

What state? I grew up next to a Chippewa river in Minnesota, but that was a very small river that wouldn't be suitable for hydro.

It was Wisconsin.

This is all fine, but has anyone begun preparing for a contingency where most of the world's major river systems start to decline? I was flying over Las Vegas last week and noticing the lakes had a thin bright tan stripe around them, like an exposed bank. I hear the big rivers in India and China are also a source of concern. What if hydropower really can't be expanded beyond its current contribution?

What I'm noticing is that hydro is increasingly supplanted by coal in Australia, Brazil, Indonesia and Africa if I recall. Here in Tasmania an underwater HVDC cable has enabled hydro to be used for peaking on the Australian mainland while re-importing cheap coal power the rest of the time. The net result is more GHGs, not what was intended.

As for solar feed-in tariffs being 'free market' I don't know if any negotiation was involved. If via gubmint subsidy you get 50c per kwh insted of 15c, then that is less public money for hospitals etc. My powerco (a subsidiary of the hydro) owes me money but won't send a cheque. So much for 'free market'.

Yes, but you would still use less coal than would have been the case without the hydro or other alternatives, even if they can't fill all the gap.

Returning to the $140k system in MA:

"Retail" installations typically cost about $9. - $12./W installed. Large "commercial" installations cost less.
Using a business model pioneered by SunEdison, investors will purchase, install, operate and maintain large systems on "host-customer" rooftops (and grounds), and sell the power at a favorable price under long-term power purchase agreements (PPAs). The model only works in states with generous incentives, such as CA, CT, MA, CO.
States offering those incentives should concentrate their ratepayer-funded dollars on schools and other large municipal structures, thereby enabling all the ratepayers to reap some reward(lower municipal energy costs) from the program. Unlike "bog-box" retailers, the municipalities won't relocate.

On ultra large CSP (Concentrated solar power) systems, the equivalent energy cost to a barrel of oil is less than 20$, see the website of MARE Initiative: www.mareinitiative.com
now, if they could built that 100 GigaWatt system for real...