A Price Point for Rooftop Solar Panels

With a flurry of proposals being floated around for renewable and other forms of energy, it is good to establish practical and realistic reference costs or price points.

In June 2011 COSTCO Wholesale through Costco.com offered for the first time a home or small business rooftop photovoltaic system with a maximum power of 5060 Watt for a cost of $18,000, which includes shipping and handling.

Such a large and involved system requires a city permit for installation and an inspection by the utility. A licensed electrician is strongly recommended for the installation. All inclusive, this system installed would cost about $25,000 or just under $5 per Watt. (This does not include Federal and State tax credits which in Hawaii would total roughly $9,000.)

The system's literature states that it will generate between 462kWh and 924kWh of electricity per month depending on placement, longitude, latitude and hours of sun exposure. By Hawaii standards, this system is big. For example, my home which houses 3 adults and 2 children consumed 420 KWh in 32 days, based on an April 2011 HECO bill. That's why I have a 1,600 Watt PV system on the roof. My system cost $13,000 or $8 per Watt installed about a year ago. Indeed PV prices are coming down fast.

Remember this figure: $5 per Watt installed. Next time a politician, legislator, salesman or contractor makes you an offer that is substantially higher either for a residential installation or as part of a utility Power Purchasing Agreement, then you are likely being taken for a ride as a customer, taxpayer or ratepayer.(1)

It should be added that the system referenced above is not the least expensive one. One can find solar panels of Asian manufacture that are sold by the palette at an even lower cost.

UPDATE: Google creates $280-million solar power fund, Los Angeles Times, 6.14.2011.

Note(1): We need to be mindful of special circumstances such as shipping and labor costs in Hawaii, specific solar exposure at each location, etc. Careful design is needed and PV is sensitive to proper orientation and as little cloud cover as possible. Given Hawaii's cost premium "substantially higher" in Hawaii (for residential installations under 4 KW) is over $7 per watt, assuming an easy installation; see note below.

Note(2): The low cost pricing assumes an easy installation and minimal safety risk for the installation crew; i.e., one floor high roof. Installations can be problematic, thus expensive.

Wind Power Misrepresentations and Lessons for Hawaii

Wind Power Generation: From the UK to NY State provide ample evidence that even a 27% capacity factor is high.

• Wind power’s actual contribution to the UK’s energy supply: The findings, based on real-time energy production from Nov 2008 to December 2010–26 months–were sobering. Wind generated at substantially below the 27% capacity factor, and low wind events (defined as output falling below 10% of capacity) occurred over one third of the time.

Much like Hawaii (1) New York state conducted a pre-deployment study: The study concluded that New York could support a 10% penetration of wind into its grid system with turbines reliably operating at 30% average capacity factor or better.

Then NY state installed over 1,200 MW of wind power, which is coincidentally the amount of daily power needed for Oahu. So... what happened?

• No wind project in New York achieved a 30% capacity factor, and most are operating at well below this figure including Maple Ridge 1 and 2 touted by wind proponents as a premier wind site. Maple Ridge was forecasted to have a capacity factor of 34% prior to construction but has consistently operated around 25% — a significant performance reduction.

• Noble Environmental’s projects produced at even lower levels. When the company sought community acceptance of its projects in upstate New York, the founder of Noble insisted their projects would operate at 30-35% capacity. In the tax agreement signed with Clinton County, NY, Noble went so far as to sweeten the deal by offering to pay a bonus of $1000/MW every time the annual capacity factor of any of their projects exceeded 35%. Result: Noble’s upstate projects operated with a 20% to 22% capacity factor in 2010.

Companies will misrepresent to get the public contracts. As we will see in the future, this happens in Hawaii as well.

Finally the article clearly describes the future in Hawaii as forecast by NY state, if Big Wind materializes:

• NY ratepayers who are subsidizing wind development in the State are also receiving considerably less than promised. Square miles of New York’s most rural areas have been transformed into industrial power plants.

Hawaii version:

Hawaii ratepayers are subsidizing large wind farms in the State are also receiving considerably less than promised. Square miles of Hawaii’s most rural areas in Kahuku, on Molokai and Lanai have been or will be transformed into industrial power plants totaling about 500 MW (in theory, of course.)

Note (1) Take a look at my article: Wind Energy for Hawaii: Great for Profits, Not so Great for Power

Renewable Energy and Hybrid Cars. Still Only at 1%.

The emphasis on renewable energy sources for the generation of electricity has a number of similarities with light duty hybrid vehicles (hybrid cars) for transportation.

Flash back to the late 1990s when hybrid vehicles where known to automotive engineers, car aficionados and some environmentalists. The odd looking 4-door Toyota Prius and the rain drop looking 2-door Honda Insight where oddities among mass produced cars. Similarly at the same time there were wind mills and solar panels worldwide, and the Puna Geothermal plant in Hawaii among other renewable energy applications.

Since then both hybrid cars and renewables had an exponential growth, at surprisingly similar pace and for substantially different reasons. Unlike renewable energy mandates, hybrid cars won their market on their merits such as quiet operation, lower maintenance and substantially higher fuel efficiency. To date their worldwide market share is about 1% among light duty vehicle fleets, and in approximate terms, 60% of hybrids are in the US, 18% in Japan, and 8% in Europe. (These change depending on the year of reference.)

Renewable energy power plants on the other hand could not develop a profitable case because of the much lower cost per watt of electricity produced by coal, natural gas and nuclear power plants. Extensive wind (Germany, Denmark) and solar (Spain) developments required major subsidies. Various studies have indicated that they actually caused losses in total national employment (e.g., King Juan Carlos university estimated that each green job cost 2.2 jobs in Spain,) and caused electricity rates to go up. This is a lose-lose outcome.

Recent data, as shown below, indicate that renewables are the fastest growing among energy sources.


Nuclear energy suffered a setback due to the catastrophe in Japan in March 2011. All countries with plans for expansion of nuclear plants will continue except for Germany. Germany has set a goal of de-nuclearization by 2020. The loss in energy generation will be replaced mostly by coal and renewables. This is another lose-lose outcome due to added pollution and the heavy use of new resources to create machines to produce power that was produced by existing nuclear power plants.

Despite governmental mandates for renewables, if their electricity production is converted to equivalent tons of oil, then their share is, much like the hybrid cars, only 1.3% in 2010, as shown below.


Given the high cost of power plants and the even higher sunk cost of the existing power infrastructure, it is likely that renewable energy will take many years to provide substantial global energy generation. China’s, India’s and Germany’s focus on coal, and US’ focus on natural gas do not support a vast expansion of the global renewable share any time soon.

Exceptions will be isolated locations such as Hawaii and Iceland (geothermal), Brazil (biomass and biofuels) and others, based on local source availability and other factors.

Source of Data: The Economist, June 11, 2001, p. 78.

Renewable Energy Sources Require Vast Amounts of Natural Resources

The National Center for Policy Analysis expertly summarized Robert Bryce's "The Gas Is Greener" which appeared in the New York Times on June 7.

In April, California Gov. Jerry Brown signed into law an ambitious mandate that requires the state to obtain one-third of its electricity from renewable energy sources by 2020. Twenty-nine states and the District of Columbia now have renewable electricity mandates, and there is also support at the federal level, says Robert Bryce, a senior fellow at the Manhattan Institute.

But while energy sources like sunlight and wind are free and naturally replenished, converting them into large quantities of electricity requires vast amounts of natural resources -- most notably, land.

Consider California's new mandate.

• The state's peak electricity demand is about 52,000 megawatts.
• Meeting the one-third target will require (if you oversimplify a bit) about 17,000 megawatts of renewable energy capacity.

Let's assume that California will get half of that capacity from solar and half from wind. Most of its large-scale solar electricity production will presumably come from projects like the $2 billion Ivanpah solar plant, which is now under construction in the Mojave Desert in southern California. When completed, Ivanpah, which aims to provide 370 megawatts of solar generation capacity, will cover 3,600 acres -- about five and a half square miles.

• The math is simple: to have 8,500 megawatts of solar capacity, California would need at least 23 projects the size of Ivanpah, covering about 129 square miles, an area more than five times as large as Manhattan.
• While there's plenty of land, projects as big as Ivanpah raise environmental concerns.
• In April, the federal Bureau of Land Management ordered a halt to construction on part of the facility out of concern for the desert tortoise, which is protected under the Endangered Species Act.

Wind energy projects require even more land -- the Roscoe wind farm in Texas, which has a capacity of 781.5 megawatts, covers about 154 square miles.

In the rush to do something -- anything -- to deal with the problem of greenhouse gas emissions, environmental groups and policymakers have determined that renewable energy is the answer. But all energy and power systems exact a toll, says Bryce.

Hawaii's renewable energy mandate is among the nation's most ambitious. Hawaii law requires electric utilities to meet a renewable portfolio of 10%, 15%, 25% and 40% by December 31, 2010, 2015, 2020 and 2030, respectively.

The lesson for Hawaii where flat space and any space in general is at a premium is that land-hungry renewable energy options are not likely to be a major part of the solution.

Brookings' Pro-transit Report Gets Slammed by Its Own Data

One thing stuck with me from the X-Files: The Truth Is Out There!

Like the City's EIS which clearly show that after spending $5.5 Billion the transit share will increase from 5.6% now to 6.6% in 2030, and that congestion with rail in 2030 will be far worse than it is now, other transit reports although word-smithed to tell a pro-transit story, actually reveal how poorly transit does, particularly rail transit.

In May 2011, The Brookings' Institution published the pro-transit report Missed Opportunity: Transit and Jobs in Metropolitan America where it made major proclamations like:

• The typical metropolitan resident can reach about 30% jobs in their metropolitan area via transit in 90 minutes.
  

The typical commute in the nation is about 30 minutes and if one has a private vehicle, he or she can reach over two thirds of the jobs in the metropolitan area. But in transit, he or she can reach only an (astounding) 4%, by Brookings' own survey numbers!

Wendell Cox had a good time this study in his Transit: The 4 Percent Solution.

• Among the 29 metropolitan areas with a more than 2,000,000 population, the 45 minute job access average was 5.6 percent, ranging from 12.6 percent in Boston to 1.3 percent in Riverside-San Bernardino.

CATO Institute's Randall O'Toole adds this: Simply putting transit close to jobs, however, doesn't mean people will ride it. The Brookings Institution recently ranked San Jose as the second-most transit-accessible urban area in America, while Chicago was ranked 46th. Yet the Census Bureau says only 3.4% San Jose commuters use transit, compared with 13.2% Chicago.

Finally let's not forget that many transit surveys are biased. They exclude, walk, wait and transfer time losses, much like the City's proclamation that Kapolei to downtown will be about 40 minutes. This excludes the access time to the Kapolei station which by itself is at least 15 minutes from the time one leaves home to the time that the train leaves the station. Add at least 5 to 10 minutes to reach the office and he or she more time commuting to work than by car, has no car to run errands or do other things after work, and has to repeat the long commute on the way home.

All this inconvenience for $5 a day leads to the ultimate result: It's a 4% solution indeed!

Price of Rail Environmental Study Doubled

Hawaii Reporter obtained this major admission from the City: The cost of the EIS doubled from the original $86 Million to $156 Million. This does not include the likely required Supplemental EIS, Preliminary Design and Final Design. All said, soft costs (paperwork, media and other fees and expenses) for the Hannemann/Carlisle boondoggle will reach one half Billion dollars, which is what other cities pay for fully installed light rail systems!

Honolulu rail is now squarely into SCAM territory.

EPA: 946 Pages to Regulate 0.5% of the Problem

The Environmental Protection Agency (EPA) recently issued 946 pages of new rules requiring that U.S. power plants sharply reduce their emissions of mercury and other air pollutants.

EPA Administrator Lisa Jackson claims that while the regulations will cost electricity producers $10.9 billion annually, they will save 17,000 lives and generate up to $140 billion in health benefits. There is no factual basis for these assertions, said Willie Soon, a natural scientist at Harvard, and Paul Driessen, a senior policy adviser for the Committee for a Constructive Tomorrow.

America's coal-burning power plants emit an estimated 41-48 tons of mercury per year. U.S. forest fires emit at least 44 tons per year; cremation of human remains discharges 26 tons; Chinese power plants eject 400 tons; and volcanoes, subsea vents, geysers and other sources spew out 9,000-10,000 additional tons per year.

All these emissions enter the global atmospheric system and become part of the U.S. air mass. Since US coal power plants account for less than 0.5% all the mercury in the air, eliminating every milligram of it will do nothing about the other 99.5% our atmosphere.

Source: Willie Soon and Paul Driessen, "The Myth of Killer Mercury," Wall Street Journal, May 25, 2011.