Spain's Solar Deals on Edge of Bankruptcy as Subsidies Founder

From Bloomberg

Jaume Vilimelis, a local farmer, walks away from his solar panels holding a bucket of pears in Lerida, Spain. Photographer: Adam Lubroth/Bloomberg Markets via Bloomberg

German Vilimelis heard about Spain’s solar gold rush from his brother-in-law in 2007.

Across the plains around Lerida, the northeastern Spanish town where they spent weekends, farmers were turning over their fields to photovoltaic panels to capitalize on government solar- energy subsidies. Vilimelis persuaded his father, Jaume, who made a living growing pears on 5 acres (2 hectares) of land in Lerida, to turn over a portion of his farm for the project, Bloomberg Markets reported in its November issue.

Vilimelis, 35, a procurement manager for a consumer goods company, pooled his family savings and mortgaged his apartment to obtain a loan of more than 400,000 euros ($558,500) to cover the investment. Within nine months, the family’s 80-kilowatt generation unit — 500 solar panels on seven racks angled toward the sun — was feeding power into the national grid.

Solar investors such as Vilimelis were lured by a 2007 law passed by the government of Prime Minister Jose Luis Rodriguez Zapatero that guaranteed producers a so-called solar tariff of as much as 44 cents per kilowatt-hour for their electricity for 25 years — more than 10 times the 2007 average wholesale price of about 4 cents per kilowatt-hour paid to mainstream energy suppliers.

Thanks to the incentives, the family met the monthly cost of the loan and even earned a small profit. Once the debt was paid off in 2018, Vilimelis looked forward to making even more money during the 15 additional years of subsidies guaranteed under Spanish law.

‘You Feel Cheated’

Now Vilimelis and more than 50,000 other Spanish solar entrepreneurs face financial disaster as the policy makers contemplate cutting the price guarantees that attracted their investment in the first place.

“You feel cheated,” he says. “We put our money in on the basis of a law.”

Zapatero introduced the subsidies three years ago as part of an effort to cut his country’s dependence on fossil fuels. At the time, he promised that the investment in renewable energy would create manufacturing jobs and that Spain could sell its panels to nations seeking to reduce carbon emissions.

Yet by failing to control the program’s cost, Zapatero saddled Spain with at least 126 billion euros of obligations to renewable-energy investors. The spending didn’t achieve the government’s aim of creating green jobs, because Spanish investors imported most of their panels from overseas when domestic manufacturers couldn’t meet short-term demand.

Stark Lesson

Spain stands as a lesson to other aspiring green-energy nations, including China and the U.S., by showing how difficult it is to build an alternative energy industry even with billions of euros in subsidies, says Ramon de la Sota, a private investor in Spanish photovoltaic panels and a former General Electric Co. executive.

“The government totally overshot with the tariff,” de la Sota says. “Now they have a huge bill to pay — but where’s the technology, where’s the know-how, where’s the value?”

U.S. President Barack Obama highlighted solar energy as part of his plan to create green jobs this month with a decision to install photovoltaic panels on the roof of the White House. The government also approved the first large-scale solar-power projects on public land. Dublin-based utility NTR Plc and Chevron Corp. will build plants in California generating enough electricity between them to power about 600,000 homes.

Sun Surplus

At first glance, Spain appears to be the perfect incubator for a solar-energy revolution. Thanks to its location in southern Europe, the country’s land mass receives 900,000 terawatt-hours ofirradiation from the sun each year, according to the European Commission — more than 3,000 times the power used annually by its citizens. In contrast, Germany, Europe’s largest economy, receives less than half that amount of irradiation. (A terawatt-hour streams enough power to run 1 billion washing machines for 60 minutes.)

The challenge for Spain was to transform that free resource into an industry that made economic sense and attracted investors. The first problem lawmakers encountered was price. Solar power, like wind and other renewable-energy sources, can’t yet compete on price against electricity generated from natural gas or coal.

Power from the most-efficient photovoltaic plants costs utilities about $275 per megawatt-hour to produce compared with about $60 for a coal-fired plant, according to Bloomberg New Energy Finance. The cost of electricity from coal is held down in part by a plentiful supply of the mineral from established mines.

Miscalculation

Spanish policy makers reasoned that generous subsidies would help the country meet its goal of 400 megawatts of installed solar power by 2010 as well as spur the development of a manufacturing industry.

The feed-in tariff proved too successful in luring investors. By the end of 2007, solar installations had exceeded the government’s target, three years early, and the following year, investors pumped 16.4 billion euros into Spain’s solar industry, quintupling power capacity to 3,500 megawatts from 700 megawatts.

“They underestimated the technology — how cheaply panels could be installed and how quickly they could be installed,” says Jenny Chase, Zurich-based chief solar analyst at New Energy Finance. “When you have 40 megawatts of photovoltaic panels, you don’t think that if you get it wrong, you’ll end up with 3,500 megawatts.”

Read the full  story here

Advertisements

85 thoughts on “Spain's Solar Deals on Edge of Bankruptcy as Subsidies Founder

  1. Being from Portugal, and knowing Spain, I can guarantee all of you that we’re in for a big bubble explosion… Fortunately, we have in Portugal little solar power, when compared to Spain. But we have a lot of wind, perceptually bigger than Spain. So, we’re in it together.
    It won’t take too much time…
    Ecotretas

  2. Solar photovoltaic power has a dirty little secret. It’s Energy Returned on Energy Invested is 0.48. Solar photovoltaic power is unsustainable.
    Wind Power is worse at 0.29. First question to ask any proposed wind power project developer is: What’s the EROEI? If they won’t tell you, they have something to hide.

  3. “Spanish policy makers reasoned that generous subsidies would help the country meet its goal of 400 megawatts of installed solar power by 2010 as well as spur the development of a manufacturing industry.”
    I wonder how that manufacturing industry is coming along?
    The studies I read, say 2 jobs lost for each “green” job created.
    Sounds like just what the United States needs….;-}

  4. California is actually smarter than someone else – Spain in this case. California offers fixed-dollar rebates to individuals and small businesses to install photovoltaic (PV) power, with a fixed fund. When the fund runs out annually, installations are no longer reviewed for the subsidy. Therefore, the cost can’t go out of control.
    I bought 200 W of PV power, but it doesn’t meet the state requirements for rebate. My PV power is at a remote site that would otherwise need a gasoline powered generator. PV was the best economic and cleanest choice for that special case.

  5. The lies about jobs all sound very familiar: in 1999 the green-spin machine and people like the British Wind Energy Association were claiming something like “45,000 jobs in the UK if we” .. spent billions upon billions on glorified wind chimes.
    And did those jobs happen? I personally warned the current minister of Energy that the wind jobs were not going to materialise and I was proved right!
    Yet, we set up a renewable energy scheme to pay over a billion a year to support wind energy, when we had no windmill manufacturers (over 10kw) and they specifically prevented subsidy from hydro – when most of the hydro equipment was built in the UK.
    Who was pulling the wool over whose eyes?

  6. Cancel the subsidy and let solar power get paid the bulk market rate.
    Spain wins. Free lunch investors lose.

  7. The reason the panels cost so much is that they take amazing amounts of energy to produce. The panels shown in the photo are either pure crystalline or polycrystalline silicon. The process for making them requires many levels of energy intensive procedures necessary to first form a gaseous silicon feedstock, such as trichlorosilane, and then to furnace decompose the feestock into pure silicon.
    As of now, there is no process for producing photovoltaic devices which is both highly efficient at energy production and has a low process energy to construct.
    In simple terms, if these produced more energy than it took to make them, they would cost less.
    If you use more energy to produce them than they will ever deliver, then they are net CO2 producers, whatever these green scheme believers say…

  8. Is it permitted to say, “We told you so.”?
    Too much money chasing a dream which collapsed.
    Sympathy for Spain? Zero.
    Sympathy for the money-grubbers who are now going bust? Also zero.
    Without insane amounts of subsidy solar power simply cannot work. It might be OK for tiny applications such as battery chargers but for anything on an industrial scale it does not work.

  9. Here in NSW, Australia, the government’s feed in tariff is 60 cents per kWh. Guaranteed until 2016. It is in the statute books as well. I’ve got panels on my roof to take advantage of the government payments. The panels will be paid back in 3 years.
    The problem, however, is the cost to the community and especially those who cannot afford to take up the government’s offer. These schemes, coupled with the failure to invest in infrastructure over the last 20 years now means that the whole community is paying huge amounts for electricity to fund the deployment of these panels and the modernisation of the network.
    On top of that, the Labor Party and Greens still want to overlay a price on carbon. Apparently, the workers in this socialist paradise, are not suffering enough for the climate by paying bills that are increasing at inexcess of 20% per year.

  10. Let me see. You get this great idea. Then you collectivize the risks and privatize the rewards. The tax payer, ah that is me, gets it in the usual place. Unfortunately when this happens, the promised associated pleasure seems to be missing. Do I see this one correctly or perhaps I am confused the facts?

  11. I am unclear what the core issue is here. Did the Spanish government not budget for the payouts they promised? Did they not put a cap on their target (sorry, but the program is full now)? Do they now have too much electricity?

  12. It is amazing how the main stream media here in California and elsewhere in the U.S. simply ignore these clearly demonstrated renewable energy economic disasters and continue to push for the same government tax subsidized renewable energy programs in our country and state. The environmental extremists are bringing economic disaster to the world with their phony save the planet mantra.

  13. I’ve held that the time has come to sell green power stocks short. The bubble’s
    about to burst…
    If it hasn’t gone “pop” already…

  14. If something looks too good to be true, it generally is.
    A man growing pears in his own orchard is reduced to near bankruptcy by green policies as in this example is ironic. A government instigating those policies is negligent.

  15. Oh course, the Chinese are laughing all the way to the bank.
    Again.
    They have the worlds largest manufacturing capacity of solar panels. Does any Eurpean country SERIOUSLY think they can make cheaper?
    Likewise anyone else sprinkling the solar pixie dust story. The only jobs in solar are offshore.
    Oh yeah – wanna know how much margin there is in selling solar panels?
    The guy who sells them to you is making well north of 25% margin. There’s lots of money in solar panels. Selling them.

  16. (A terawatt-hour streams enough power to run 1 billion washing machines for 60 minutes.)

    Hey, now I understan’ ‘dos big nummburs.
    Sheesh.

  17. Sorry to nitpick, but the in title ‘Founder’ should be ‘Flounder’?
    [Reply: Either one works. ~dbs, WUWT spelling gestapo.]

  18. “You feel cheated,” he says. “We put our money in on the basis of a law.”
    Unfortunately, unlike the Laws of Physics, the Laws of Man are not conservative, and are done by the whim of the weakminded and foolish.

  19. I had to laugh at the report of the solar energy getting fed back into the Spanish grid at night. When someone thought to investigate, they found people running diesel generators and making a profit on the subsidy payment. Clever, eh?

  20. “You feel cheated,” he says. “We put our money in on the basis of a law.”
    That sort of sums it up.
    Governments can, and will, change their minds on uneconomical technologies.

  21. the country’s land mass receives 900,000 terawatt-hours ofirradiation from the sun each year, according to the European Commission — more than 3,000 times the power used annually by its citizens
    =================================================
    and you can only achieve that number by making everyone move out and covering every square inch with panels
    Lord, I hate it when people say ridiculous numbers like that…………..

  22. I’s not necessary for other countries to repeat Span’s mistake, BUT…
    whaddaya think the odds are that any US politician is paying attention? A small few are, but the rest are believing their own press releases.

  23. Yup solar subsidies have rapidly become stupid. they were set up base on manufacturing costs several times what they are now
    Large scale pv only costs about $2000/kW installed – or about $100/MWh in a sunny place (less than Bloombergs $275). That means that it is about $0.10 per kWh. Not cheap enough to compete with wholesale prices in most places but basically cheap enough to compete with retail prices if you stick it on your roof.
    It appears that panel prices are actually being held artificially high by the excess demand created by subsidies – PV modules can be manufactured for as little as $800/kW now (First Solar), but are being sold for an average of $4000/kW at retail.
    It is probably good to encourage further growth and price drops in this industry somehow (it’s a useful long term economic contribution to energy production) but it does not need to be much – perhaps allow users to sell electricity back to the grid for the same price they are charged for it. And domestic roofs are the most economic location. Otherwise it is probably time to dump the subsidies and let the industry stand on it’s own feet.

  24. Fools who invest in politician’s promises will has their funds easily picked from their pockets. They should play Eve-online and learn the rules of investing among sharks.

  25. It’s just never a good idea to do things like,
    invest your life savings in one thing,
    mortgage your dwelling to finance an investment or
    depend on a government subsidy to make an unprofitable endeavor profitable.

  26. Spanish policy makers reasoned that generous subsidies would help the country meet its goal of 400 megawatts of installed solar power by 2010 as well as spur the development of a manufacturing industry….
    investors pumped 16.4 billion euros into Spain’s solar industry, quintupling power capacity to 3,500 megawatts from 700 megawatts….

    Oops!

  27. Charles S. Opalek, PE says:
    October 19, 2010 at 2:54 pm
    Solar photovoltaic power has a dirty little secret. It’s Energy Returned on Energy Invested is 0.48. Solar photovoltaic power is unsustainable.
    Wind Power is worse at 0.29. First question to ask any proposed wind power project developer is: What’s the EROEI? If they won’t tell you, they have something to hide.

    You have a link to that? I’d be interested in seeing it and I’m too lazy to go looking for it myself.

  28. At first glance, Spain appears to be the perfect incubator for a solar-energy revolution. Thanks to its location in southern Europe, the country’s land mass receives 900,000 terawatt-hours ofirradiation from the sun each year, according to the European Commission — more than 3,000 times the power used annually by its citizens. In contrast, Germany, Europe’s largest economy, receives less than half that amount of irradiation. (A terawatt-hour streams enough power to run 1 billion washing machines for 60 minutes.)
    I hate to be al nit picky here but can you please at least get your units correct. A terawatt-hour is NOT power, it is energy.

  29. The same guys that sold the greens on wind power and reaped tons of tax payer subsidized profits are probably going to make a killing when the time comes to tear all of these wind turbines down from their govt. contracts.

  30. H.R Said:
    I’s not necessary for other countries to repeat Span’s mistake, BUT…
    Unfortunately, for our sakes, Ontario and British Columbia are getting ready to march right down that road. Ooooo, the jobs!!!!!
    Pissing our money away is what they are doing.

  31. “Sorry to nitpick, but the in title ‘Founder’ should be ‘Flounder’?
    [Reply: Either one works. ~dbs, WUWT spelling gestapo.]”
    Ah, but the Flounder will given the proper environment smell like the government boondoggle does 😉 .

  32. ” Charles S. Opalek, PE says:
    October 19, 2010 at 2:54 pm
    Solar photovoltaic power has a dirty little secret. It’s Energy Returned on Energy Invested is 0.48. Solar photovoltaic power is unsustainable.
    Wind Power is worse at 0.29. First question to ask any proposed wind power project developer is: What’s the EROEI? If they won’t tell you, they have something to hide.”
    Until I see the study that confirms this, I’m gonna go ahead and say this is total BS!

  33. Dennis Nikols, P. Geol. says:
    October 19, 2010 at 3:17 pm
    Then you collectivize the risks and privatize the rewards. The tax payer, ah that is me, gets it in the usual place.

    I think you have it just about right. Also, it really doesn’t matter what the enterprise is when the “risks are public and the reward is private” you are gonna have big problems.

  34. vboring says: “Cancel the subsidy and let solar power get paid the bulk market rate. Spain wins. Free lunch investors lose.”
    Confidence in government plummets. Chaos. Inflation. Enter the man with the little mustache. War. Everyone loses.

  35. I am flabbergasted how easy people take Government grants on win and solar for granted.
    There is a total disconnect.
    If coal generated power is 6 dollar cent per Kw and Government offers you a grant and 60 dollar cents per Kw to put a solar panel on your roof you know someone is going to be screwed.
    And so it is.
    With ten solar panels installed there is suddenly green energy to be sold and the scam takes off.
    In Austria a company buys cheap coal generated electricity to pump water into a mountain lake.
    When the lake is full they sell Green Hydro Generated poser back to the German Market and make a big big profit.
    At WUWT is an article about a diesel powered solar panel so they deliver “Green” power during the night.
    http://wattsupwiththat.com/2010/04/13/the-insanity-of-greenery/
    If society goes down the drain it is because of plain stupidity among the political establishment and it’s electorate.

  36. Dan in California says:
    “October 19, 2010 at 2:56 pm
    California is actually smarter than someone else – Spain in this case. California offers fixed-dollar rebates to individuals and small businesses to install photovoltaic (PV) power, with a fixed fund. When the fund runs out annually, installations are no longer reviewed for the subsidy. Therefore, the cost can’t go out of control”.
    Yes, but they still manage to go bankrupt.
    The point is that they spend public money on Green hobbies wit no effect whatsoever.

  37. DoctorJJ says:
    October 19, 2010 at 8:23 pm
    ” Charles S. Opalek, PE says:
    October 19, 2010 at 2:54 pm
    Solar photovoltaic power has a dirty little secret. It’s Energy Returned on Energy Invested is 0.48. Solar photovoltaic power is unsustainable.
    Wind Power is worse at 0.29. First question to ask any proposed wind power project developer is: What’s the EROEI? If they won’t tell you, they have something to hide.”
    “Until I see the study that confirms this, I’m gonna go ahead and say this is total BS!”
    No it’s true.
    And on the longer trend the numbers are even worse due to technical problems with the wind mills and failing panels in regard to solar.
    You can find a lot of info at this site:
    http://www.masterresource.org/2010/09/wind-not-power-iii/
    And complete reports about wind and solar at the sppi blog where you can also download PDF reports
    http://sppiblog.org/?s=wind+power&Submit=Go
    What people forget is the fact that both wind and solar are only possible because we use oil to build them.
    How green is that?
    Green, sustainable, all enviro mambo jambo without merit.

  38. “H says:
    October 19, 2010 at 3:15 pm”
    The other problem here in NSW, Australia, is that more and more people rent. And more and more of those renters rent apartments, so roof space (Or any common space) is unavailable to them.
    But yes, I can see it will be an enormous failure.

  39. Today the UK government will be announcing huge cuts in Government spending without any cuts in taxation, in fact more likely there will be increases. At the same time they are still keen on promoting PV subsidised at the equivalent of 60 US cents per kilowatt hour, with costs passed on to the consumers with no choice.
    If the energy produced by solar cells is less than is used to make them then the greenest and cheapest thing to do is to get a field of mock solar panels and use a generator to actually produce the electricity, or just use power from the grid if you can get an independent supply. This saves CO2 over a real array of panels, and maximises financial returns. It is best not to produce electricity on a 24 hour basis as some Spanish installations did!
    In the UK the carbon taxes only apply to goods produced in the UK, and nothing on anything from abroad, which could explain why most, and possibly all, wind turbines are made abroad. This could also explain the lack of ‘green jobs’.
    With the lack of a viable energy policy the UK is facing blackouts in a few years time, but with a doubling of the cost of electricity! We are doomed, but every government in the developed world seems hell bent on following the same route.

  40. Should the title not be :
    Spain’s Solar Deals on Edge of Bankruptcy as Subsidies Flounder
    [REPLY – Sounds fishy to me. ~ E]

  41. Like all these things, the mistake here was a matter of timing.
    The technology now isn’t cost efficient. So the focus should be on building a niche market steadily whilst technology gets better, not going mainstream with inefficient kit.
    There’s no doubt that solar will be an important energy source in decades to come. Particularly in North Africa, Southern Europe, Australia, SW USA and a few other places too.
    But right now the industry is like mobile phones in the 1980s………..

  42. The British Government is sick with these corrupt so-called “green” schemes.
    Not being satisfied with destroying the landscape, shredding millions of birds, and bankrupting the country with wind-farms, the “green” retards currently running the place also want to ruin us with solar panels.
    ============================
    THE BRITISH SOLAR PANEL RACKET
    The British countryside sprouts solar farms as firms cash in on subsidy scheme.
    Fields in Gloucestershire’s rolling countryside, immortalised by Laurie Lee in “Cider With Rosie”, may soon be covered by thousands of solar panels. Despite the lack of guaranteed sunshine, the solar farms will make a guaranteed profit because of a generous subsidy funded through increases in household energy bills.
    The rate of installation of solar panels will increase 500% in Britain this year because of this feed-in tariff, according to PricewaterhouseCoopers. Ecotricity, a renewable energy company based in Stroud, is planning dozens of solar farms and is considering sites near its headquarters.
    Dale Vince, the company’s founder, admitted that trying to generate solar power under England’s frequently gray skies was an inefficient way of reducing “greenhouse gas” emissions. Even in the sunniest parts of England, the farms will generate a third less electricity than farms of the same size in southern Spain. But, Mr Vince said that the Government’s feed-in tariff scheme, which began last month, had made solar farms economically viable.
    He intends to announce within weeks the location of the first 25-acre, 5-megawatt solar farm. By 2020 Ecotricity plans to be generating 500 megawatts of electricity from solar panels, enough to power more than 100,000 homes. Mr Vince told The Times: “We are planning to build grid-connected solar farms all over the country. “We are looking on the East Coast, the South West, the South East and around here in Stroud. We don’t want to go too far north because the sunshine drops away. Halfway up the country would be the cut off, a bit north of Birmingham.”
    He denied that solar farms would be a visual blight on the landscape, arguing that they would be less obtrusive than wind turbines or rows of polytunnels used to grow fruit and vegetables. “They won’t stand more than 2 meters (6.5ft) tall so you won’t see them if you look across the landscape because they will be obscured by hedgerows. “You would see them if you were standing on a hill but the visual impact is very minor compared with wind arrays.” He said that some of his farms would have solar panels and turbines in the same fields. “Solar panels and wind turbines complement each other well because in summer the winds are lighter but there is more sunlight, with the opposite in winter.” He said solar panels were 600% more expensive per unit of electricity generated as onshore wind turbines, which are themselves several times more costly than gas or coal plants.
    Commenting on the subsidy available, Mr Vince said: “We don’t think a feed-in tariff policy is the best way to go but it’s here and rather than sit and sulk and say it shouldn’t be done, we are just going to get on and do it. The more people do it, the more efficient and cheaper the technology gets.” The farms will cost £15-20million each but Ecotricity will receive index-linked income for 25 years from the feed-in tariff, which starts at 29p per kilowatt hour. This should deliver a return of at least 8% a year.
    The coalition Government has pledged to keep the tariff. Indeed, the Conservatives and Liberal Democrats argued while in opposition that the rates were too low. John Marjoram, the deputy mayor of Stroud and one of Britain’s first green councilors when elected in 1986, welcomed the idea of solar farms but said that 40% of the district was in an Area of Outstanding Natural Beauty. “Of course we would encourage every sort of renewable energy because we are so far behind the rest of Europe. But we will also have to consider the visual impact,” he said.
    The Campaign to Protect Rural England said that it would be better to place banks of solar panels on factory and warehouse roofs and above car parks. It said that some farms in the countryside could be acceptable, depending on the quality of the landscape.
    The rate of installation of solar panels will increase 500% in Britain this year because of this feed-in tariff, according to PricewaterhouseCoopers. Ecotricity, a renewable energy company based in Stroud, is planning dozens of solar farms and is considering sites near its headquarters.
    Dale Vince, the company’s founder, admitted that trying to generate solar power under England’s frequently gray skies was an inefficient way of reducing “greenhouse gas” emissions. Even in the sunniest parts of England, the farms will generate 33% less electricity than farms of the same size in southern Spain, but said that the Government’s feed-in tariff scheme, which began last month, had made solar farms economically viable.
    He intends to announce within weeks the location of the first 25-acre, 5-megawatt solar farm. By 2020 Ecotricity plans to be generating 500 megawatts of electricity from solar panels, enough to power more than 100,000 homes. Mr Vince told The Times: “We are planning to build grid-connected solar farms all over the country. We are looking on the East Coast, the South West, the South East and around here in Stroud. We don’t want to go too far north because the sunshine drops away. Halfway up the country would be the cut off, a bit north of Birmingham.”
    Mr Vince said that some of his farms would have solar panels and turbines in the same fields. “Solar panels and wind turbines complement each other well because in summer the winds are lighter but there is more sunlight, with the opposite in winter.”
    **********************************************
    I have just been informed by my electricity supplier that my bills will increase by 25% with immediate effect to pay for the same level of consumption. This is a direct result of this sort of green-washed tree-hugging fraud. Clean coal and nuclear are the only realistic solutions – not this fashionable eco-lunacy.
    So Britain’s beautiful countryside, already suffering from choked roads and a lack of rail infrastructure, abandoned villages and closing pubs, will be blighted still further by useless “renewable” energy projects, which will make a lot of money for the installers and the owners of the properties where they are placed and will cost the ordinary taxpayer dear. Were it necessary, were the threat of CO2 emissions actually real and harmful to the earth’s future, it would still be a folly.
    No amount of these solar panel or wind farms can hope to provide all the power needed by Britain in a cold winter (and perhaps there may be a few more of those yet before the message finally gets through to the deluded “green” fascists). Nuclear power is the only real hope for Britain as it is here in France. I hope the new coalition is able to swallow their pride and accept this before lights go out with unpleasant repercussions for everyone.
    *************************************************
    Solar panel firms “are misleading consumers”
    The consumer group Which? called on industry to clean up its act after undercover investigation revealed high-pressure sales tactics. Solar power installers are bamboozling householders with high pressure sales tactics and misleading financial statistics, an undercover investigation by a consumer group has found.
    The consumer group Which? condemned most of the companies it came across as “cowboys” and cautioned that the Government would have to clean up the taxpayer-backed industry, vital for the battle against climate change, unless it improved its performance.
    The consumer group launched its investigation after a rise in complaints about solar thermal firms. Undercover researchers rented a house in southern England and invited firms to quote for installing solar thermal systems, which use sunlight to heat tap water. Of the 10 that exaggerated the financial savings that could be made, the double-glazing giant Everest subsequently admitted that its representative had made false claims – that its system could save 30 times more money than was possible. Another firm, Ideal Solar Energy, wrongly claimed a solar scheme could halve gas bills and grossly misquoted energy supply statistics from the energy regulator Ofgem.
    Which? said: “While these two companies concerned us the most, we received poor service and exaggerated claims of performance from nearly all 14 firms.” Its chief executive, Peter Vicary-Smith, said: “Most of the firms in our investigation behaved like true cowboys – they promised huge savings that bore no relation to reality, and some really piled pressure on the homeowner to sign up immediately or risk losing a one-off ‘special offer’.” He added: “The solar industry is too important to our long-term energy needs for things to drag on like this.”
    Neil McLoughlin, a trading standards officer who saw undercover footage of the Everest sales visit, said the precise nature of the quotation made the claim even more misleading and suggested the Everest may have broken the law on sales tactics by offering thousands of pounds off the price for making a decision “on the spot”. After being informed of the “sting”, Everest said: “We’re disappointed that our representative failed to use the sales support documentation provided and made claims he knew to be false.” In addition to boasting it could halve gas bills, Ideal successively dropped its originally quote of £8,690 to £5,860 and made a “pushy” phone call to the householder. It also misquoted statistics from energy regulator Ofgem about the proportion of a gas bill that goes on heating. Ideal later defended its pitch, saying: “Like all retailers, we offer limited promotions on a selective basis” and added it instructed its sales agents not to specify savings to hot water bills.
    Just one company, Southern Solar, was found to be helpful and provide sensible advice.
    Last year, the OFT received 1,000 complaints about the solar panel industry – high for an industry with fewer than 100,000 installations in UK homes.
    The Renewable Energy Association, a trade body which runs an assurance scheme for solar installers, said it was concerned by the report. A spokesman said: “We will be contacting Which? to follow up on their investigation, and take any action necessary against any of the companies which are members of our scheme.”
    ——————————————————
    From August 5, 2010 a British company, HomeSun, started giving away the first of 100,000 solar power systems to anyone with a decent-sized south facing roof. A staggering 2.5 million homes could be eligible in this £1billion giveaway set to run for three years.
    The scheme enables homeowners to cut electricity bills immediately, to the tune of about 40% a year. For a typical homeowner, in a three-bedroom semi, that’s about £250 a year.
    So what’s the catch? Remarkably, there doesn’t appear to be one. HomeSun, run by respected entrepreneur Daniel Green, isn’t a charity. Rather, it has a simple business model which provides homes with free power but also enables the company to profit. With his customary eye for spotting an opportunity, Green figures that most people are deterred from solar systems because of start-up costs. With a system costing £15,000 it can take at least a decade for anyone investing in the expensive equipment to begin seeing a return. That’s why the UK, unlike Germany where solar power is booming because of government incentive schemes, is trailing.
    HomeSun, however, can afford to give away the systems because energy companies are now compelled, for the next 25 years, to make payments to homeowners for all solar power produced. That’s both power used in the home and any surpluses.
    The new Government-backed incentive scheme is meant to encourage us to become greener and help the country to meet tough EU “emissions” targets. Under the company’s scheme customers get to keep all the solar power they need, free of charge, and the fees received from the energy companies – known as Feed-in Tariffs – go directly to HomeSun. In addition to providing and installing the systems the company will maintain them for 25 years.
    It would seem that the beauty of this new scheme is that everyone wins at a time when bills have doubled.
    Currently it’s estimated that 27% of carbon dioxide emissions come from homes so there’s also an environmental bonus. Green accepts, though, that most of his potential customers will be driven by hard-headed economics.
    Currently, only a handful of British homes benefit from solar power, although it’s clean and systems are easy to install. Green estimates it could be as few as 1,000 out of 24 million homes. “People have been nervous about solar power because it’s seen as expensive and we don’t have a very sunny climate,” he says. “The technology for solar power has been around for decades. Germany provides 50% of the world’s solar power yet we’re nowhere. That is going to change. There is going to be a revolution and that’s what excites me.”
    Should anyone doubt his commitment they should take a peek up the drive of his home in North West London, where a Toyota Prius sits. The petrol and electric hybrid has replaced the cherished 6-liter Aston Martin, which Green drove until a few months ago. He adds: “I’m not a charity and I haven’t become a tree-hugger. However, I do think we’re mad not to make more use of such a great natural and free resource as the sun.”
    Solar power is provided by harnessing light – not heat – from the sun and although not as effective in cloudy conditions still provides enough electricity to operate most of the gadgets and white goods in our homes. Overall, at the right property, it will provide 40% of a home’s electricity needs. Ironically, rainy weather is a bonus, helping to keep panels clean and performing well. It all works with the normal power supply, which kicks in automatically when there’s insufficient solar energy. Along with the savings, it’s predicted that conventional energy costs are set to, well, go through the roof in the next few years.
    Not everyone will be eligible. Solar panels work best on roofs facing South, South East or South West, where there’s no shade from trees or neighboring buildings. Just a small amount of shade can cut the efficiency by 50% and if your home faces North, forget it.
    HomeSun will assess your roof before providing a system and there’s a second scheme for roofs that are not perfect, in which property owners pay £500 for the equipment and £5 a month. It’s in the company’s interests to make sure your roof is suitable because it relies on the payments from the electricity companies for power generated to make its profits.
    Green is convinced that the UK is on the verge of a solar power boom, adding: “There’s the political will for this. I have spoken to David Cameron and he is very committed. I think people do care about the environment and having a solar power system on your roof is a badge of honour. In any case, no-one is going to argue about getting free electricity.”
    As a boy Green was expelled from grammar school and told by his exasperated headmaster that he’d never amount to much. At the time, instead of studying for exams that were expected to secure him a place at Oxbridge, he was bunking off lessons to plot his first business venture. Green, who was allowed to sit his A-levels, gained moderate results but the head’s gloomy prediction for his future prospects could hardly have been wider of the mark. Barely into his 30’s, he became a millionaire when he sold his clothing company and has never looked back.
    Green, 43, isn’t a fan of rich lists and is reluctant to discuss his wealth but it’s estimated that he’s now worth several millions. He can truly be said to have the Midas touch. Allied with an uncanny ability to spot a trend, they’re why his latest venture demands to be taken seriously. His first venture, soon after he left Leeds Grammar School under a cloud, was to found Identikit, his own men’s clothing label. Later, he launched Brand Centres, based on a business model of selling designer labels at out-of-town sites to keep costs down. He was offering Armani jeans for under £70 when High Street rivals were asking £100.
    Green made his first millions when he sold the business to Moss Bros in 1999, then spotted the digital revolution looming in television and the internet. His company, You Me TV, which helped customers find the best packages, was eventually sold to Sky for another fortune and Green became head of Sky Retail for three years before branching out solo again. A popular boss, many of his workers have moved with him.
    “To be successful you have to have a vision and focus doggedly on it,” he said. “The business takes over your life, even at the breakfast and dinner table. It gets in your blood but it can be very lonely. Whatever I was going to do next it had to be a sustainable business and make me proud.”
    Green says events in the Gulf of Mexico, where BP battled the disastrous oil spill, reinforced the path he has taken. “Oil is the new tobacco,” he says. “BP has got the British brand all over it and been terrible for the country.”
    The US is another world leader in solar power, where an unlikely figure is spearheading the drive. Larry Hagman, better known as oil baron JR Ewing in Dallas, is now the public face of solar power for a German company. His mansion in California is covered in solar panels.

  43. It is not the power coming in that you count but the power you get out. These things are below 20% efficient, the earlier ones were 7-9% efficient, and only work during the day. I know this area in Spain. It is a bit desolate and agricultural production was high with fruit, grape vines for cheap wine and maize. They are losing growing land for little profit. They get intermittent power and no crops. A loss leader.

  44. Steve says:
    October 19, 2010 at 3:42 pm
    Sorry to nitpick, but the in title ‘Founder’ should be ‘Flounder’?
    [Reply: Either one works. ~dbs, WUWT spelling gestapo.]
    Sorry Steve and Gestapo, I’m going to nitpick your nitpick and nitpick your nitpick rebuttal respectively.
    ‘Founder’ in this context means to fail utterly, from the nautical term ‘to founder’, meaning to sink. It is (apparently) derived from the Old French ‘fondrer’, meaning ‘to (go to the) bottom’, itself from the Latin ‘fundus’ – bottom.
    ‘Flounder’ means to flap about in confusion; it is also a flatfish that seems to get an unfairly bad press – are they really noted for their confused behaviour?
    So anyway this scheme has either sunk or is afloat but thrown into confusion – the former may be rapidly followed by the latter of course. We have a similar scheme in the UK and I find it amazing that people don’t see that it is the most blatant scam. The electricity supplier buys back electicity from consumers at far more than they sell it for – what could possibly go wrong? Of course some mug has to pay, and when they run out of money, the game is up. The mugs in this case are the Spanish and British public, and I for one have had enough of having my pocket picked by pompous middle-class twits.
    [Reply: Good post. But I did look up both definitions before commenting: “Flounder: • figurative; to be in serious difficulty.” Either term works in the instant context. But founder is most correct. ~dbs]

  45. On the good news front, the UK government has just approved 8 nuclear power stations to be built in the immediate futeure. The same government has also canned the huge experimental wave generator that was to be built at the mouth of the Severn.
    Strangely, the government has been VERY quiet about both items!
    The same government is also paying X4 retail power subsidies for installation of solar panel arrays – no grown-up, or joined-up, thinking going on here.

  46. Doctor JJ @8.23
    In John Etheringtons “The Wind Farm Scam” he quantifies CO2 savings attributed to wind turbines.
    each MW of installed wind power capacity displaces no more than 1130 tonne of CO2 per year. Calculated with a 30% load factor (many consider it should be closer to 20%) and 0.43 t/MWh ( the average CO2 emission from the UK grid mix of thermal power stations). The calculated payback time for construction and erection is about 1.1 years.
    Wind turbines do need thermal base load backup and because that backup has to be immediately available for when the wind drops or exceeds safe operating speeds the backup is running at sub-optimal load levels. For every MW of installed wind capacity there needs to be a MW of thermal backup capacity.
    The UK experience is showing that despite large investments in wind power the CO2 savings will be less than that of shutting one medium sized coal fired power station. So whether all that equates to a .48 EROEI or not I can’t say. What does appear obvious is that wind is ineffective and horribly expensive compared to coal. The logical answer to reducing CO2 without reducing our power supply is to go nuclear.

  47. Regarding subsidies. Subsidies simply inflate prices no matter the good intentions. Cheap housing loans or government grants simply increase house prices by a similar amount. Subsidise wind turbines or solar panels and the price rises to meet the new upper limit. It has always been thus. Alternative power just has to competewith the current cheapest available and that is coal.

  48. The first part of Don Quixote, by Miguel de Cervantes, was published in 1605… and the first English translation was published seven years later in 1612.
    Don Quixote is famous for tilting at windmills, not paying his debts and experiencing many humiliations… so perhaps the book should now be re-classified as non-fiction.

  49. In Australian news today, miners are claiming the Federal Government is renegging on its Mining Resources Tax Heads of Agreement concerning payment of royalties. An ironic comment on television tonight: ‘If you can’t trust the Government, who can you trust?’

  50. In Spain, the real problem about the energy is that there has been no new nuclear plants in the last 30 years and most people ideas for the near future are about closing the old ones (8 providing 20% of total electricity) that still are running (one of them was closed last year)
    Of course, coal/fuel burning is not a nice option in the spanish eco-paradise, so these kind of facilities also face a ‘dark’ future.
    So we will end up with a really big dependence on wind turbines, solar panels and hydroelectricity, with natural gas being the last resource for those days with no wind, almost no sun and not too much water in dams.
    The net outcome of all these facts is that electricity prices are skyrocketing and a lot of business cannot make a profit with this kind of huge costs .. and unemployment is also skyrocketing: 20% official data … near 30% unofficial data !! -> unemployed people that accept to take some kind of courses offered by the goverment in order to improve their professional skills are no longer accounted as unemployed and people with tiny jobs (1hr/day) that are actively searching for a full time job aren’t accounted as unemployed.
    Spain is a very good example of a deeply flawed energy policy, as a result of letting eco-friendly wishful thinking people to manage it.

  51. “Beth Cooper says:
    October 20, 2010 at 3:29 am”
    Trusting Govn’t/Politicians is an oxymoron like “military intelligence” sadly…LOL

  52. “Alexander K says:
    October 20, 2010 at 2:14 am”
    Wasteful spending by the UK Govn’t is under review and will likely be severely cutback by upto 25%. The UK is in so much debt (Thanks New Labour), like ~30% of GDP I understand.

  53. Living in Ontario, where the power is always called “hydro” I am bemused at the government drive to double my hydro bill to subsidise these con men, I am glad these fre loaders are in trouble, I doubt they care about those who cannot afford their expensive power, I hope a lot loose everything the have! Also I have read that the output drops off yearly on those units.

  54. The left loves to scold the rest of us about “sustainability”, yet they favor projects that cannot be sustainable without open-ended subsidies. And there is never any accounting for the economic damage the tax does to other people in other places. Solar power is a great concept, but its economics stink. If someone wants to install some panels, that is fine, just don’t coerce others to help pay for it.
    We used to be prosperous enough to afford to entertain these sustainability experts with their childish Utopian dreams, but those days are OVER, by a trillion times they are over. We cannot afford to make any more investments that pay back 10 cents for each dollar we borrow from China. We must stop walking down the road to serfdom. The fist step in this 12 step process is being brutally honest about the cost of these projects. The ones that are one easily profitable must be stopped immediately.

  55. The salvage and reclamation industry will be making money when those solar panels and windmills end up being scrapped sonner than later. You have to wonder which politicians will profit from that windfall….

  56. So essentially in the future when everyone goes we don’t want no spanish law, it’s not that Spain is about to conquer us all, but not wanting to get cheaply ripped off, like some victim from some crazed street nazi, by the government.

  57. Now Vilimelis and more than 50,000 other Spanish solar entrepreneurs face financial disaster as the policy makers contemplate cutting the price guarantees that attracted their investment in the first place.
    “You feel cheated,” he says. “We put our money in on the basis of a law.”

    Suckers. Anyone who believes what the government says (ours or theirs) is a fool. Governments can only be depended on for three constants; they will 1. lie, 2. cheat, and 3. steal. (I wish I was being sarcastic, but I’m not.)

  58. woodNfish says:
    October 20, 2010 at 9:30 am
    Governments can only be depended on for three constants; they will
    1. lie,
    2. cheat, and
    3. steal.
    and
    4. enforce with extreme prejudice….

  59. Psst – dbs. Of the two, Founder is the MORE correct.
    [Reply: Which is what I said to Jim Turner above. And that is my final word on the subject. ~dbs]

  60. >>Mr Osborne confirms £1bn funding for a carbon capture
    >>and storage project.
    But nobody has yet said what they will do if you have a Co2 blowout.
    Can you imagine a Gulf of Mexico disaster, with CO2 gushing to the surface. Wherever the cloud drifted, everyone would die.
    Do these Greens know what they are dealing with?

  61. CO2 blowouts do happen, and do kill plenty.
    Certain lakes in Africa are deep enough cold at the bottom, and they
    have CO2 sources. At some point, the lake reaches 100% CO2 saturation at
    all depths.
    Then something happens to disturb the lake. Cold, saturated water from below
    rises up; the CO2 is no longer stable at the lower pressure, and gas forms. That
    moves more water, and the process goes exponential in a few seconds. A few
    cubic km of gas gets released, and any mammals nearby cannot breath.
    Solar subsidies are market perversions. But which electrical market is not
    already perverted? Here in SoCal, with current prices, panels pay for themselves
    in about 5 years — even with out the California state subsidy. This is because
    the electricity rates are so high.

  62. Americans may be interested in Obama’s solar energy plans.
    This is from today’s Telegraph:
    21 Oct 2010
    America’s 240-acre sun farm
    Charles Laurence
    The Wild West’s new pioneers are harnessing the billion-dollar potential of solar power.
    To one side of the fence, a herd of bison grazes against a backdrop of low mountain peaks, the unmistakable landscape of America’s West. To the other, a workforce in yellow construction helmets and orange safety vests is bolting solar energy panels to steel tresses in rows several hundred yards long…
    ————————————————
    note: A nuclear power station in this area will cost about $1 billion to build. That’s four times the cost of this scheme but it will generate 35 times as much electricity, reliably.
    http://www.telegraph.co.uk/earth/8075872/Americas-240-acre-sun-farm.html

  63. Why is it that we see today just about zero discussion of solar power satellites?
    Back in the 1970s and ’80s, those of us in science fiction fandom (the true moral and intellectual elite of humanity; the rest of you are just goddam mundanes) were focused sharply upon what rocketry expert and SF writer G. Harry Stine referred to as The Third Industrial Revolution (1975, and Jeremy Rifkin’s johnny-come-lately misappropriation of the expression be damned), in which the concept of solar power satellites in geosynchronous earth orbit (GEO) figured very large.
    For those unfamiliar with then-contemporary thinking on the subject will find at http://tinyurl.com/22u34wg a brief 1980 article by Stine on the subject.
    From Barry Goldwater’s introduction to the first edition of The Third Industrial Revolution:

    “Space, [Stine] argues, is to be the scene of a Third Industrial Revolution because there man can find virtually limitless energy and resources. Pollution as a by-product of the First and Second Industrial Revolutions disappears in the vastness of space. He pictures our present earthbound industrial system as being a closed system for ecological purposes. By developing space as a site for industry, man opens up the system and ensures his future survival–a survival holding the promise of plenty rather than scarcity.”

    The “limits to growth” Luddites – like Jeremy Rifkin – hate the hell out of commercial space industrialization, and have done their best to kill all progress toward that end by way of restrictive government prohibitions impairing capitalization and operations.
    Not only would high-capacity solar power satellite systems deliver real renewable electrical generation capacity at levels sufficient for an expanding industrial civilization, but the establishment of genuinely economically viable space transportation systems would enormously facilitate the exploitation of microgravity resources and the production of materials which can most efficiently be created only in environments with effectively none of the spacetime warping that cannot be escaped at the bottom of a planet’s gravity well.
    And pushing ahead with the real third industrial revolution (instead of this namby-pamby substitution of hydrogen gas for petroleum distillates as engine fuel) would make Jeremy Rifkin’s head explode with pure rage.
    Don’cha wanna see that happen, folks?

  64. 21 percent of the Spanish population is in poverty
    Read more: http://www.typicallyspanish.com/news/publish/article_27604.shtml
    Power companies in Spain say that the 4.8% proposed increase in electricity prices for domestic and small business users from October 1 is not enough. Consumers’ organizations have already criticized the price hikes which mean that electricity will cost 30% more than it did in July 2007, but the power companies say more is needed as there is greater use of renewable energy.
    Read more: http://www.typicallyspanish.com/news/publish/article_27290.shtml#ixzz131r7hgLI
    Unemployment above four million again in Spain
    Read more: http://www.typicallyspanish.com/news/publish/article_27290.shtml#ixzz131r7hgLI
    In total at the end of June there were 4,645,500 people out of work, 508,000 more than a year ago, and taking the percentage to 20.09% and a new 13 year record.
    Read more: http://www.typicallyspanish.com/news/publish/article_26888.shtml#ixzz131uflaXH
    etc

  65. Charles S. Opalek, PE says:
    October 19, 2010 at 2:54 pm
    “Solar photovoltaic power has a dirty little secret. It’s Energy Returned on Energy Invested is 0.48. Solar photovoltaic power is unsustainable.
    Wind Power is worse at 0.29.”
    Call me unsporting, but I checked out EROEI on Wikipedia.
    http://en.wikipedia.org/wiki/EROEI
    Yes, I’m well aware of the biases there. Anyway their EROEI for wind power in N America and Europe is 20. Charles, either you or Wikipedia is off by more than 1.5 orders of magnitude. Do you have measurement data to back up your claim?
    R. de Haan says:
    October 19, 2010 at 9:33 pm
    “No it’s true.”
    He gave
    http://www.masterresource.org/2010/09/wind-not-power-iii/
    as his first link. I went to that home page, and there was not a single mention of the EROEI acronym. It’s very possible that EROIE is discussed in one of the chapters, but I was not inclined to do any additional fishing.
    Bah-Humbug Larry’s observation: People who make sweeping claims often fail to provide measurement data, solid links, or the reasoning behind these claims. All too often, they parrot BS ‘factoids’, which reinforce their prefab worldviews. I say: More data, more analysis, and less sloganeering.

  66. Did a little looking on google and the graphs I found give wind about double that of hydro, that has to be a lie, even allowing for the limited use that wind is it is no less an engineering feat than a hydro station, however I doubt there will be many wind farms using the engineering groundworks that there are in hydro (go to niagra, there are victorian works still usable, I suspect the 100 year old generators, if still about would work) wind farms? I doubt they will still be upright in 50 years, the off shore ones ?? I do not see why we consider either wind or solar for main generation, they are great in isolation but useless and spasmodic for real power. The industrial revolution was not enabled by windmills, they had been around well before but it was water power that drove the mills and then the foundries that lead on to steam.

  67. Ontario now third largest SOLAR PV market in North America after Cali and NJ. Our FIT program modeled after Germany’s 80.2cts /kwH for 10kW and under rooftop solar and 71,2cts for 10 to 250kW sized plants. 21,000 applications already submitted and 10,000 of those backlogged 3 months. Big commercial rooftop owners like Loblaw’s grocery stores, are installing, and IKEA. It certainly is kick starting a solar industry here (for now), but our COLLECTIVE electricity rates have gone up $300/YR already.
    Consider the “optics” of this:
    The single mother of 2 kids shopping at Loblaws (owner Galen Weston III, $6BIL net worth) for her groceries gets to contribute to the Green revolution by paying $300 more a yr for her electricity- while IKEA’s store manager gets to report to Sweden his $200,000/yr FIT windfall and Loblaw’s promotes themselves as Green (you bet with a 14% ROI on their $1.5MIL solar array!)
    Solar Panel Debentures. $100> rate: 8%, 20 yrs. Payable by Loblaw’s.
    Perhaps a better idea to allow those mothers to at least say they are on the same Green roof as Galen Weston- The President’s Choice.
    After buying her apples, she can scoot over to IKEA and slum around on their solar rooftop,
    http://www.cbc.ca/consumer/story/2010/10/07/con-ikea-solar.html
    regards,
    Stu

Comments are closed.