US President Barack Obama announced on Saturday the awarding of nearly two billion dollars to two solar energy companies that have agreed to build new power plants in the United States, creating thousands of new jobs.
One of the companies, Abengoa Solar, has agreed to build one of the largest solar plants in the world in Arizona, which will create about 1,600 construction jobs. When completed, this plant will provide enough clean energy to power 70,000 homes.
The other company, Abound Solar Manufacturing, is building two new plants, one in Colorado and one in Indiana.
These projects will create more than 2,000 construction jobs, and over 1,500 permanent jobs as the plants produce millions of solar panels each year, according to White House officials.
Uh, not so fast there varmints.
Abengoa Solarhas not produced a commercially available non-governmental power plant in the US. If it produces solar panels I can't confirm that by reading its home page. It does lay claim to producing a "tracker" which may or may not have some new technology in it.
What it appears to be is in the solar power generating business using OEM products and its own "tracker." Now there is nothing wrong with that, but given the experience Spain has had with solar power we should be viewing it with eyes wide open. Especially when two billion dollars of our money is being tossed around.
And if they don't manufacture a product, what are the on going jobs besides construction of power plants? Nothing wrong with that, but let us not think of a factory setting in Waycross, GA, for example, providing two or three thousands jobs on an on going basis.
Of course the real question is this. Can solar energy produce electric power that is competitive? The present price of electricity to the consumer is around 10-15 cents per KWH in a large part of the country. We have a fair size home, about 3400 square feet and it is well insulated and I have installed energy efficient appliances so my results won't be typical, but we use about 70 KWH per day. At 10 cents that is $210 per month. At 15 cents that's $300. (We're currently at 10 cents.)
Looking at Abengoa's Home Page we see the current wholesale price of electricity generated by fossil fuels at around 7 cents. Assuming my price has some water power generation along with coal and a mark up of 35% wholesale to retail that tracks pretty well if you again assume no new distribution construction costs.
It also shows Concentrated Solar Power - CSP - at 20 cents and Photovoltaic at 30 cents. And the good news is by 2017 CSP is at 10 cents.
It also shows Photovoltaic at about 15 cents at the same time.
Sorry Charlie, but I just don't believe that technology will produce a 50% reduction in price in 7 years. TANSTAAFL. There aint no such thing as a free lunch.
But even if did happen the consumer/retail price would be up about 33% in 7 years.
In other words that $210 bill will be near $300. That current $300 bill will be $400.
That is a nice return on your investment, eh?
Abound Solar is a manufacture of solar panels. Founded by professors from CSU it says it will add another manufacturing line with its $400 million loan guarantee.
There is no word about how much money will be paid to CSU, and the tax payers, who employed the inventors. I expect this will be State Capitalism at its best.
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