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Ten Million Solar Roofs Act Huge Waste of Tax Dollars

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The cost of electric from solar PV compared to conventional methods is more than three times more expensive.

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Yesterday, two of the low-lights of Congress announced their 10 Million Solar Roofs and 10 Million Gallons of Solar Water Heating Act of 2010. Being a tech guy, I'm all for new tech and, realistically, I have no desire to ruin the planet anymore than the next person. However, this is one of the biggest damned wastes of tax dollars since that bridge up in Alaska.

I can't speak to the water heater side of the equation but the electricity generation I'm very familiar with. Pictures always tell a better story, so look at the one below. What you see is the cost of residential electric power per kilowatt hour from solar photovoltaics (PV) versus conventional methods. More than three times more expensive! What's worse, the PV estimate from Solarbuzz assumes a climate averaging 5.5 hours of sunshine per day over a year. That's comparable to what we get in the Sun Belt states. Consequently, for the rest of us, the cost is actually higher.



If the differential between the two costs were largely the result of PV lacking economies of scale, such a program might make a little sense. But it's not; it's primarily a function of efficiency.

There are two basic methods for PV today: silicon-based and thin films. The silicon-based solutions tend to have the highest efficiency (about 22%-23%) but the cost of production is high because the substrate, silicon wafers, isn't cheap. Thin-film solutions have lower production costs because of lower cost substrates, but the efficiency tends to be in the high single-digits. Consequently, subsidizing 10 million more roof tops with our tax dollars isn't going to close the cost gap. Certainly more research may but that doesn't garner headlines or votes.

Then there's the "green jobs" argument that parallels with this fairy tale. While it's true that PV installers would have a field day with our tax dollars, that's a fairly limited impact. Look at the two largest PV hardware companies -- First Solar (FSLR) and SunPower (SPWRA). Both are great companies but where do they do the bulk of their manufacturing? In Southeast Asia! First Solar has four plants in Malaysia, one in Germany and one in Ohio. SunPower has two plants in the Philippines and one in Malaysia.

And not to be forgotten in this feel-good story should be a report early last year from Spain. The Study of the Effects on Employment of Public Aid to Renewable Energy Sources notes that, since 2000, Spain spent €571,138 to create each "green job." More importantly, "the programs creating those jobs also resulted in the destruction of nearly 110,500 jobs elsewhere in the economy, or 2.2 jobs destroyed for every 'green job' created."

When you see bills like this million-roof march, it makes you wonder what our "representatives" use for brain cells.
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