A Cure for Energy Depression – More Sun?

By education and training, I am a nuclear engineer. By necessity, I am a business and information technology consultant. So it is, when you must feed a family of five, and the industry you believed would fuel the economy of the 21st century was killed in its nascence by environmental special interests, media disinformation, and government regulation. That is a subject for another posting; however, as my mother used to tell me, “Whatever does not kill you, will make you a stronger person.” And so it was with that attitude that I developed an interest in solar engineering, and almost took a job in that field in 1979. Maybe, I should have, but I came to the conclusion that solar would never be a serious solution to our basic energy needs, and I still believe that. It has its place in the energy mix, but you will never build a free, technology-based economy that can smelt steel and produce silicon chips from solar energy. I have two basic objections: (1) capital / operational costs and (2) energy density. A third reason for not supporting the technology, negative net energy generation (viz., more energy is required to manufacture the system than can be recovered over its life-cycle), has been overcome, at least in some system designs.

In prior postings, I have tried to provide you with the basic facts, so that you could follow my logic and conclusions. However, in this case, I have the facts straight from a proponent of solar energy: so, you don’t have to believe me, you can believe them.

The Montana Green Power (MGP) organization (http://www.montanagreenpower.com/) has produced a series of lessons to promote “green energy” in the schools. Lesson 8, “Are PV [Photovoltaic] Systems Cost-Effective?” This lesson has three objectives: (1) analyze the costs related to PV; (2) calculate the environmental cost savings of PV compared to fossil fuels; (3) investigate tax incentives or rebates [I guess they mean subsidies] that would make PV systems more affordable.

With respect to cost, the MGP lesson plan states:

“Today in Montana, a 2- to 4- kilowatt (kw) grid-intertied [viz., connected to the power grid] PV system will have an installed cost of between $9 and $16 per watt, with electricity produced over the life of the system costing 25 to 30 cents per kw-hour. In comparison, residential electricity purchased from the utility grid costs about 7 cents per kw-hour.

“We must also consider hidden environmental costs, called external costs. While the above information suggests that fossil fuels are much cheaper than renewable energy, consider these facts [emphasis mine]:

- Extracting fossil fuels causes environmental damage from the extraction equipment and from the pollution that is a by-product of burning those fuels.
- Fossil fuels are not free. They cost money to bring out of the ground. This means as fossil fuels run out, their price will increase.
- Fossil fuels give off gases whey they are burned. Most of these gases – sulfur oxides, nitrous oxides, and carbon dioxide, for example – may be [emphasis mine] causing a change in the global climate, sometimes, green house effect, climate change, or global warming.”

Let’s look at the stated financial benefit of solar, and put it in context. The installed cost is all cost required to design the system, purchase its components, purchase the site, install the components, and bring the system to the point of commercial operation. In the case of solar, this cost is $9 to $16 per watt. Using an average of $12.50 per watt, this is equivalent to $12,500 per kilowatt (kw). According to an article by Matthew Wald of the International Herald Tribune, “Price of new power plants rises sharply,” July 10, 2007, quoting a Duke Energy spokesman, he reported that it would cost $1.83 billion to build a new 800 Mw fossil plant, which represents a cost of $2,288 per kilowatt. The same article reported the cost of a nuclear plant to be in the same range: $2,000 to $3,000 per kw. In other words, a solar facility with the same capacity is more than five times as expensive to build as a modern fossil plant, with full environmental controls.

To check my facts, I went to a source where you would expect the source to be biased in favor of alternative energy sources: the California Energy Commission. They reported the capital cost of the following energy sources:

If you believe California, PVs are more cost competitive, but still twice the cost of fossil: just for the equipment.

From an operating perspective, GMP reports that the ongoing cost of solar generation is 25 to 30 cents per kw-hour compared to 7 cents per kw-hour for fossil generation, or 4 times as expensive.

What about energy density? In a prior posting, I compared the energy density of fossil generation to the energy density of wind power. A 2,259 Mw fossil plant requires 800 acres (TVA’s Paradise Fossil Plant). Assuming that the fossil plant operates 70% of the time, then in one year it generates 17,315 Mw-hr/acre-year. To calculate the energy density of solar, the 1 – axis, tracking, flat-plate collector with a north-south axis data published by the National Renewable Energy Laboratory (http://www.nrel.gov/rredc/) was assumed, with the collector oriented relative to the horizon at latitude – 15 degrees. For Helena, Montana, the 30 year average of monthly, solar radiation, 1961 – 1990 is 6.3 kw-hr/meter square – day. Assuming 10.76 square feet per meter, 43,560 square feet per acre, and 365 days per year, solar radiation at the surface of the PV array is 9,309 Mw-hr/acre-yr. However, one must consider the conversion efficiency of the PV – its ability to take the solar radiation falling on it and convert it to electricity. According to Wikipedia, solar cell conversion efficiency for commercially available solar cells is 14% to 19%. Assuming 17%, then the energy supplied by a solar array in Helena, Montana, is 1,582 Mw-hr/acre-year. Therefore, fossil power is almost 11 times more efficient, from an energy density perspective, than solar power. In more practical terms, if you want to supply the energy requirements for 100,000 people, you can either build an 800 acre fossil plant or an 8,800 acre solar plant.

But GMP claims we should consider other external costs. But should we? The cost of mining coal, burning the coal, and meeting all the environmental standards is included in the cost of operations: 7 cents per kw-hr. It should not be included twice in the comparison, unless the objective is to kill the technology and one is willing to pay 4 times the price for solar. With respect to gas emissions, it is not scientifically proven that global warming is even occurring. If it is, the extent to which man’s activities contribute to it certainly has not been established. In fact, some studies suggest that volcanic activity and even cows contribute more to greenhouse gas than does man.

According to the American Coal Foundation, “Coal supplies in the United States are far more plentiful than domestic oil or natural gas; they account for 95 percent of the country's fossil fuel reserves and more than 60 percent of the world's fuel reserves. The United States has about 275 billion tons of recoverable coal, which could last us more than 250 years if we continue using coal at the same rate as we use it today. In addition, the United States has more than 25 percent of the world's estimated coal reserves.” Some estimate that America’s coal reserves, in terms of energy content, are more than three times that of the Saudian Arabia oil reserves.

In conclusion, when solar generation is compared to fossil generation, solar is five times more expensive to build, four times more expensive to operate, and requires eleven times as much land. The threat to the environment is at best unproven and at worst is overstated. Solar proponents are really using fear to advocate an ideological position that is not supported by the economics. That said, solar does have a place in the energy mix. In locations where there is high solar radiation for long periods of time and the location is not proximate to the existing electrical grid, solar may prove economic. Otherwise, let the free market rule: if an individual wants to make a commitment to the technology for personal reasons let him or her do so. No compelling basis exists to create a public policy that must be funded by the rest of us at a substantially greater cost.

The cure for energy depression is less sun.