Wall Street Journal: Why Venture Capitalists Gave Up on Renewables

money_sucking_vortex

Guest essay by Eric Worrall

Wall Street Journal has written a fascinating explanation for why venture capitalists have given up on renewables.

Why Venture Capitalists Abandoned Clean Energy

Two experts say high costs and low returns sent venture capitalists fleeing. A new funding model, they say, is crucial.

A decade ago, clean-energy companies were the hot trend that venture capitalists were chasing. Oil and natural-gas prices were on the rise and Al Gore’s “An Inconvenient Truth” had just made its premiere.

But high hopes that the clean-energy sector would replicate the big returns of biomedical and software startups quickly faded. Instead, monumental losses piled up: Venture-capital investors lost more than half of the $25 billion they pumped into clean-energy technology startups from 2006 to 2011.

A study of why venture capital and clean energy haven’t been a good match was launched by Benjamin Gaddy, director of technology development at Clean Energy Trust, a startup accelerator in Chicago, and Varun Sivaram, the Douglas Dillon fellow at the Council on Foreign Relations. In a paper recently published through the MIT Energy Initiative and written with Francis O’Sullivan, the Energy Initiative’s director of research, they predict future funding for energy startups increasingly will come from more-patient providers than venture capitalists—including groups like the Breakthrough Energy Coalition, formed by Bill Gates and more than two dozen wealthy investors last year. And they argue that established energy companies and governments need to play a bigger role in nurturing clean-energy startups.

DR. GADDY: Ultimately, when we looked at the data, when we looked at companies that got venture-capital investment, [clean-tech firms] were slightly more risky [than software or biomedical], but the real difference was the returns. Those outsize multiples simply weren’t there.

This home-run return requirement—that the 1-out-of-10 successes need to pay back the entire fund—we found that that simply was not true for clean-tech companies. When clean-tech companies exited they didn’t return sufficient capital to investors.

Third, energy companies or clean-tech companies were going into markets that are legacy industries, for which a product already exists that does a pretty good job. So when you’re a solar-panel company competing with cheap electricity from natural gas, you don’t have the benefits of high margins. You instead have to compete at the razor-thin margins of the commodity markets.

Read more: http://www.wsj.com/articles/why-venture-capitalists-abandoned-clean-energy-1473818402

I believe the article skirts around the real reason renewables are a dead end. Even if breakthroughs occurred, and someone discovered a way to say produce 100% efficient solar cells, the improvement in the viability of renewable energy would not be game changing.

Once venture capitalists realised this fundamental showstopper, there really was no valid financial reason to continue. Of course, the renewable VCs could still get lucky – even worthless assets can generate a return, if you can find a financially illiterate politician who is stupid enough to pour taxpayer’s money into schemes which have already failed.

Advertisements

146 thoughts on “Wall Street Journal: Why Venture Capitalists Gave Up on Renewables

  1. “if you can find a financially illiterate politician who is stupid enough to pour taxpayer’s money into schemes which have already failed”

    We truly have our work cut out for us.

    • Traditionally most VCs have not been interested in markets that are as subject to the support and whims of the government as renewables. They want to be selling into markets that are consumer driven. The consumer driven market for expensive renewables is small – the only way a larger market can exist for renewables is to have it either supported and/or mandated by the government. So now the political risk associated with the investment is very large; VC’s don’t like that.

      • As a Consultant, I saw this about 12 years ago, private investors were getting involved with numerous cellulosic and other “renewable s” and we were working with clients to design units and solve problems with pilot plants for subsequent commercialization. Based on “claims” by many that they had technology that would work and misled investors. Some were even partially subsidized by the government who in a desperate state to get renewable liquid fuels were demanding unrealistic timelines to commercialize and provide fuel replacing fossil fuel. Many were rushing prematurely into building commercial size plants ignoring technical problems to get the government subsidies because of the unrealistic government timeline .
        After a few years, and many failures, the $$$ dried up as non government investors faced the reality that the technology was absent.
        The consulting dried up with only government subsidies left but the government continues to throw good $$$ after bad ideas..

  2. This was well known when we routinely costed energy sources and futures back in the 1970s.
    Intermittency of RE is not a recent discovery. It has long been a reason not to invest. A fundamental, unchanging reason, like poor energy density of inputs.
    Geoff

    • The unreliability of renewable energy in the form of wind was documented in the tax value as early as the doomsday book where the windmill was only rated as a tenth of the watermill on the adjacent property even though the peak output was the same as the duty officer concerned noted the unreliable nature of wind energy and looked at actual throughput instead of peak rating. My how we have progressed backwards in intelligence of officialdom.

    • Well Put Geoff. I believe and I will quote an article written by one of your USN Captains..a Mr knifer, who did an excellent study on the viability of Bio-fuels for th USN.

      Seems that Biofuels have an EROI (Energy Returnon investment) of: 1:1.4 Whereby one received 1.4 times what one invested as far as input energy was concerned…not including all the other things that 1.4% took to make Such as losing valuable arable land for the production of corn for ethanol for instance.

      Oil on the other hand has an EROI of 1:8

      No contest – it never was..

  3. “… governments need to play a bigger role …”. That’s the only solution that is going to work. Step 1 – subsidize the living daylights out of renewables; step 2 – drive cheap energy out of business; and and, step 3, make energy prices so high that renewables can actually make a profit.

    The economics are really simple. And, of course, this will ultimately provide an outrageous return to one’s VC cronies.

    • That and Privatizing Profits And Socializing Losses

      Good to see there are still fines for violating the Laws of Thermodynamics.

    • It’s all coming home to roost in Ontario where Eco Premier Catherine Winn just announced that she will remove the provincial sales tax on electricity for consumers, resulting in a $150 per year savings per household. All this because electricity rates have doubled over the past 10 years due to the rush to renewables and the shutting down of coal-fired plants. The result will be a 1.2 billion dollar loss to the Ontario government which taxpayers will have to pick one way or another.
      Thus you have the ridiculous situation of taxpayers paying themselves to fight climate change.

      • Trebla, the cost is far higher than $1.2 bn. The three gas plants needed to stabilise the grid disrupted by the windmills cost $3.8bn by the time they were relocated and connected. All was unnecessary. The windmills were also unnecessary and far more expensive than that. Not that government built them, they just guaranteed to buy the power for far more than it was worth to the customers. Then there is the PV nonsense at two and a half times the price for power.

        The only solution is to complete the Darlington refit and think about how to bring up the power from Pickering. There are 21 CANDU reactors in Ontario. One more would cover the ‘renewable’ portion. They can sell the windmills to someone in California. That will root out the cause of the instability.

    • I hope these people understand that when an artificial market is created by the stroke of a lawmaker’s pen, it can be just as easily taken away by the same stroke. Look at all the breast-beating and teeth-gnashing when the tax credits are about to expire.

  4. “… governments need to play a bigger role …”.

    That’s greenalist speak for taxpayers’ dosh! In otherwords, unreliables are unprofitable without it!

    • Force companies to invest in renewables because there is lack of investment capital for renewables. And for example Exxon money into renewables.

      • And to hell with the stockholders, eh Barb? You must really hate all the retired people out there that hold vast amounts of these stocks in their portfolios. Unless your plan is really to have the government step in and “save” them. Too big to fail, of course.

      • Do you drive an electric car, Barb? When Exxon raises the price of fuel to cover their “green” investment, the poor people (who can’t afford Teslas) will subsidize your green state of grace. The real pain will be felt in Africa, where the population will rise well beyond 1billion without any developmental improvement. But you’d rather not think about that, would you? You don’t have the foggiest idea of the economic reality of these idiot ideas. But you will soon because the next Great Depression is coming. Make sure you and your eco-Socialist friends take full credit, Barb, when millions are dying!

  5. It’s almost comical that someone had to do a “study” to figure out that “Hey, everybody who tried getting into this lost their a$$es, even when they were government subsidized”.

  6. I have a solution–invest in Shipstones. Heinlein’s fiction has all the reality, and much more plausibility, than many proposed energy storage proposals for making “renewables” viable as a utility-scale enterprise. Roger Sowell, you out there?

    • I like to think (fantasize). Thirty some years ago, I came up with an idea which turned into run-of-river hydro power (no I did nothing with it, so somebody else also invented it).

      I have an ocean wave (OW) idea which might be economic (but way out of my means to implement). Most OW schemes I’ve seen are timid, proposing to capture only token power and shutting down when the waves got too big. I propose a lattice of ocean floor mounted supports for a field of vertically bobbing poles.

      The poles would be over 32 feet long (50′ or more ?) so that they could produce really long swings of movement. The poles would be geared to accept all different length swings up & down and attached to turbines perhaps 100′ above the surface. Power could be generated both on the poles’ up and downswing. The pole diameter would be limited only by the lattice’s strength/ability to control the oscillations of the poles.

      Weird idea? Most definitely! There’s more, but for now even this may be too much for most people.

  7. The industry is finally maturing, no thanks to DoE and the White House. As part of that maturation, you would expect no more VC opportunities to come along than say coal power plants, gas turbine facilities, and steel mills.

      • Resource Guy- Cali is one of the few places where solar, particularly rooftop installations, make some sort of sense. Much of the power demand for air conditioning more or less corresponds to the solar output.
        The extravagant subsidies(30% investment tax credit, production tax credits, renewable power standards, feed-in tariffs, all make “renewable power” attractive.

        In a few years start looking for subsidies and tax credits for recycling solar panels, subsidizing bird kills, more favorable tax treatment of dying wind turbines, and other subsidies.

      • @Phil
        Not to mention that they are starting peak demand pricing for residential. AW recently installed a (unsubsidized) solar system at his home. Search for details, but IIRC, peak pricing for power is going to be or already is $0.90/kWhr. That kind of artificial price pressure makes the solar choice more attractive.

  8. Tesla – vast battery plant… is Tesla not venture capitalism then?

    There doesn’t seem to be any lack of people investing in renewables…

    • Griff, the combination of Tesla and SolarCity amounts to walking bankruptcy. They are burning $1 billion in cash per quarter. One of the best short plays ever.
      Tesla got $1 billion in subsidies for the Gigafactory from Nevada. And every time the federal renewable subsidies are eliminated, investment drops to zero.

    • Griff,
      I grew up in a town adjacent to West Orange NJ where a guy named Edison put most of his capital in a massive automotive battery plant because he and a friend named Ford thought that was the future.
      Thomas went bankrupt (only to be bailed out by an invention he intended as a stenographic device called the phonograph). Henry was wiser; he made a few electric autos but never invested in infrastructure as heavily as Tom.
      Many companies have tried to develop storage since then; it is NOT a young technology.
      BTW, this is NOT semiconductors, Moore’s Law does not apply.

    • According to Devonshire Research ‘Tesla is not a car, battery, or tech company; it is an experimental
      financial services company and should be regulated as such.’ and ‘TSLA’s use of tax credits disproportionately benefits the wealthy at the expense of the average taxpayer’

      Hard to disagree with those statements (devonshireresearch.com for more details and disclosures). Devonshire confirm it does not have professional or business relationships with any of the following organizations:
      General Motors
      Ford
      Toyota
      The City of Detroit
      Koch Industries
      ExxonMobil
      Royal Dutch Shell
      BP
      CB Insights
      The Illuminati
      Marshall Mathers, aka “Eminem”

      I’ve helped to crowd fund Cool Futures Fund Management which will ‘short’ unreliables. I won’t be able to afford the minimum stake in the fund itself and so will miss out on the profits which I expect to be huge so my seed funding has gone down as a charity donation and a ‘good deed in a naughty world’.

  9. The theoretical Shockley Queisser limit on monojunction solar is 31% efficient. Sun Power already makes commercial monocrystalline silicon cells that are 26%. NOBODY is going to invent 100%.
    Renewable wind and solar will never be economic without grid storage. And grid storage is both techically and economically impossible on the scales warmunists envision except where hudro can be flexed (e.g. Denmark / Norway). See essay California Dreaming and CE guest post Grid Storage.

    • In satellite applications, we’re closing in on 30% but they are way, way too expensive commercially. Nice to see someone post that there is a limit. The area needed to do any worthwhile solar energy production/harvesting (to even register on the grid) will remain ginormous.

  10. https://about.bnef.com/press-releases/clean-energy-defies-fossil-fuel-price-crash-to-attract-record-329bn-global-investment-in-2015/

    “Clean energy defies fossil fuel price crash to attract record $329bn global investment in 2015

    2015 was also the highest ever for installation of renewable power capacity, with 64GW of wind and 57GW of solar PV commissioned during the year, an increase of nearly 30% over 2014.

    London and New York, 14 January 2016 – Clean energy investment surged in China, Africa, the US, Latin America and India in 2015, driving the world total to its highest ever figure, of $328.9bn, up 4% from 2014’s revised $315.9bn and beating the previous record, set in 2011 by 3%.”

    • The US alone needed 903GW of energy generation in 2013 http://www.eia.gov/todayinenergy/detail.cfm?id=9671

      And the investment for last year – GLOBALLY – was only 13% of what the US needs each and every year?

      Really, all you have told us is how much money people are LOSING to the companies raking it in before they go out of business and leave the bill to the rest of us.

    • Almost all of that renewable “investment” is higher cost energy being built under government mandates. These are large politically driven projects that won’t respond to market forces readily. If those projects were privately financed with no government backing or supporting contracts/mandates, most of them would have been mothballed. Another way to read that headline is “Government continues to waste tax dollars and require high electricity costs despite lower costs of traditional fossil fuels.”

      • I don’t believe that to be an accurate headline at all. The notion that wind energy and solar energy will never be viable is ridiculous. Fossil fuel is cheap now , but not long ago our very security as a nation was threatened to the point of sending our young men and women half way around the world to die for it. Obviously fossil fuel is a finite resource. sure to become more scarce with time. How much of a waste is it to avoid being held hostage as a nation by Middle Eastern dictators , and avoiding sending young Americans to die for our “national interest” of fossil fuel” ? Climate doesn’t need to even be included in the discussion for the need of energy independence.

      • Until the power density and intermittency problems with renewables are solved, they will never be viable.
        Wishful thinking does not trump the laws of physics.

      • QBagWell – Just wrong

        The problem is power density (Watts per unit area) even if solar could convert ALL the incident sunlight to energy the CO2 benefit of Solar is too low – here.
        Per Square meter

        Incident energy 100W
        Effective average running time per day 5/24
        Maximum reliable energy (assuming 1 days storage) 0.2 – EG the grid needs 99% reliability but wet and overcast days happen
        Energy Cost to make Solar panels – 80% of lifetime output

        So take a 200W 20% efficient solar panel
        Incoming Solar energy 1000W
        Best energy generation 200W
        Averaged out (store) over 24 hours: 41 Watts
        Make reliable enough to supply the grid at 90% + reliability: 8.2 Watts
        Allow for storage and conversion losses 6.56 W
        Deduct Energy cost of production: 1.31Watts
        Allow for output deterioration over life 1.18 Watts

        So after all your harping the “Reliable Free energy” (- 90% reliable Energy in excess of production energy-) is only 1.17Watts for a 200 Watt solar panel. Even if the Panel were 100% efficient you still would get no more than 6.5Watts on average because these things don’t work when its dark/dull.

        Not only this but if you take into account the lifecycle energy cost for the batteries, mounting frames, connecting copper cables, inverters, metering etc and the land/surface preparation, then the solar panels and accessories NEVER MAKE BACK THE ENERGY THAT WENT INTO MAKING THEM. This means in practical terms that you could not construct these solar installations (including manufacture of components) using a solar power installation of the same size as the one you are installing. The Nett CO2 is positive, adding solar panels adds to global CO2 because of the fossil power that went into making the components of the installation.

        What could be worse – Wind power of course

        For a 1MW windmill one needs clear air of 5 Hectares. For a well sited windmill, the average capacity factor is similar to solar, 17% meaning that on average (over a year)a windmill produces 170kW out of 20000 square meters of space which is a power density of 8.5 Watts per meter. But wind of course can be becalmed for weeks, if not months by an ill placed high pressure system (Naughty Gaia), this means that there is NO AMOUNT OF STORAGE that can bring wind power up to grid reliability, OOPS. There is also a lot of high energy and CO2 emitting componentry like concrete that goes into Windmills, indeed lifecycle studies have shown that more CO2 is emitted by the production of materials that go into windmills than is ever saved by the energy they produce, building windmills adds to CO2 and they produce NO NEW ENERGY. They are big but unreliable batteries.

        Now as an exercise calculate in square km how much land one of these systems needs to occupy to produce say the Energy New York uses entirely from Solar’s “Free energy” output (Hint New York’s Peak energy Consumption is around 34 GW)

        Answer. around 29 Billion Square meters or 29000 square km or around 36 times the area of new york city. This would produce 34 GW for New york and around 140GW of output needed to construct the replacement solar array for when this one wears out in around 10-15 years.

      • qb:

        Over 99% of our electrical energy is generated from non-petroleum sources. So having our electricity being held hostage by Middle East dictators is not a reality.

    • @Griff: Your big numbers don’t mean much when I can produce meager ones to counter them. The U.S. federal govt’s Energy Info Agency (EIA) gives us the following numbers for unrelia-newables (and all the others):

      Major energy sources and percent share of total U.S. electricity generation in 2015:

      Coal = 33%
      Natural gas = 33%
      Nuclear = 20%
      Hydropower = 6%
      Other renewables = 7%
      Biomass = 1.6%
      Geothermal = 0.4%
      Solar = 0.6%
      Wind = 4.7%
      Petroleum = 1%
      Other gases = <1%

      Source: http://www.eia.gov/tools/faqs/faq.cfm?id=427&t=3. These numbers are as of April 1st of this year.

      0.6% for solar in the U.S. alone. Wind (unreliable as it is) is also quite meager at 4.7%. And how long have we humans been using the wind as an energy source (recall the great sailing vessels from centuries past among other things).

      Griff, the solar panel was invented back in 1954, so it's been around for some 62 years now. As far as I am concerned, if ANY technology can't scale up to meaningful commercial levels in 62 years, chances are it never will. Solar and wind are poor, low density energy sources, and that would explain it.

      Your big mistake here Griff is your inability to recognize and understand the stupidity of humanity as those VCs have demonstrated.

      • Hey – my figures are just to point out there is a large scale of investment in renewables -something this article was claiming wasn’t happening…

      • I drive from San Antonio to Santa Fe every month or so, right through a major wind generation area. In addition to all the problems you mentioned, I notice that about a third of the ‘mills aren’t turning at all when I pass, not due to lack of wind. I think the machines produced to suck up government subsidies simply aren’t that reliable; even worse, the guys who fix them have to climb about 300 feet in the air to do so.

    • Literally all of it being forced by activists and government and a few shady crony-capitalists with their three-card monte figures, praying upon bleeding heart suckers who they’ve conned and fleeced for generations.

    • “Clean energy defies fossil fuel price crash to attract record $329bn global investment in 2015.”

      Right! And the effect on the world’s energy supply? Renewables increased their share from a massive 2.4% in 2014 to a whopping 2.6% in 2015.

      Don’t hold your breath waiting for renewables to replace fossil fuels at this pace!

      • Don’t neglect what all that investment and super duper renewable power has done for us. As world economy staggering toward the debt abyss with barely measurable growth. The next government programs will pay people to dig holes and bury solar panels and wind mills.

    • Investment has risen–that is, people (or corporations, or governments) have been fooled or forced into contributing. Has energy actually been produced in commensurate amounts? If energy has been produced, has it come into being without backup (in other words, are we not still forced to expend fossil fuels in order to keep the “renewables” supply of electricity coming at a steady rate)? In order for anyone objectively to say that “renewables” are living up to their name or their promise, that person will have to show that solar power, or wind power, or whatever combination thereof he discusses, produces a steady, reliable stream of electricity that needs no supplement, no separate outside supply to take up the slack when the sun doesn’t shine or when the wind blows too little or too much. And then there’s the issue of actual expense . . . If you want cheap, dependable electricity, fossil fuels are still the way to go, unless you have nuclear. Believe me, your hospital, your laboratory, your airport, your traffic lights, everything you can think of, benefits from cheap, dependable, steady electricity. Nothing less will do–and so far, renewables are far, far less.

    • Griff
      Let’s at least try to be accurate! Whatever number you pretend the installed capacity is, we know it is just pretend and the actual delivered power will be less than 25%. These idiot schemes live on subsidies built on lies with invisible government money. If you’re not just a hypocrite, refuse the subsidies and throw your own money at it!

      • John

        who is pretending otherwise?

        People are investing in renewables at a great rate anyway – 7 UK car manufacturing plants have solar power supplies, for example, because it allows companies to fix costs on around 10% of their supply.

  11. These venture capitalists were not electricity grid experts, and natural gas prices have come WAAAAY down, from around $14 to $2, making it possible to do the unheard of – replace a baseload coal plant with a natural gas one, which is the almost only reason that carbon power emissions have shown such a reduction over the past decade. There are SOME venture capitalists funds that have a brain when it comes to energy – one invested a couple million in Transatomic Power, creator and developer of their version of a molten salt reactor, the obvious future of power, everywhere – can provide the cheapest power, rid us of nuclear wastes by burning htem, thus essentially no fuel costs, little need for management , etc Intrinsicaly safe. One company developing molten salt reactors is claiming a levelized cost of power less than 2 cents per kWhr. Economics IS driving us down the road to zero-emission power.

    • Arthur, can you explain to me how a MSR “burns” fission wastes such as cesium 135 and strontium 90 ?

      • It doesn’t burn fission products; it can burn trans-uranics like Pu-239, which have half-lives long enough to make storing spent fuel an issue. Cs-135 and Sr-90 have half-lives of about 30 years, so storing them in a manner that won’t leak before they decay isn’t hard.

      • Thank you Bill, you now understand why I take issue with “Arthur” when he posts “… rid us of nuclear wastes by burning them…”

      • Not only that, Strontium 90 and cesium 135 are low level radiochemicals that have potential commercial uses, for example a beta emitter like Strontium 90 can be used to make a nuclear battery that might be able to power your smartphone for 100 years. Gamma ray emitters like Caesium can be used to cause fluorescence – you could in theory make a light bulb that burns by itself without power for 30 years.

  12. The reason is a matter of science and the “energy flux density” of a proposed energy source and the economics and practicality of the necessary apparatus to capture that energy. I have written an article on this for citizens at large, politicians, regulators, and businessmen who do not have a strong science background. It is on line at: http://fusion4freedom.us/energy-basics/

  13. Renewable drivers, not technology. Clean energy, not converters. Low density, large scale green blight of local and regional ecosystems that may be first-order causes of anthropogenic climate disruption.

  14. Among other factors, fracking, slant drilling and other oil/gas extraction technologies did them in. Now, the Greens can say “Big Oil stopped progress again.” And they will repeat this.

  15. Completely misses the point.

    Batteries that provide reliable and affordable grid-scale storage are already revolutionizing renewable energy.

    EV or Electrical Vehicles with cheap batteries are changing the electric grids for the better.

    Investment opportunities abound for those who understand the game.

    • ‘Batteries that provide reliable and affordable grid-scale storage are already revolutionizing renewable energy.’

      Examples???

    • Not holding my breath Roger. When the utility scale battery count in deployment is greater than zero, we can talk about “investment opportunities”

    • Renewables are already too expensive, and we are going to increase that cost by a factor of 10 by requiring you to buy batteries that also don’t work.

      • MarkW

        Bang on! Just a multlier on an already absurdly high cost with future maintenance/ replacement costs to come. Maybe that’s what Roger means. Wait for the suckers to come in and then run for it!

    • See DOE website for grid scale storage installations.

      My investments are in place.

      See my blog or WUWT earlier post on Battery Game Changer.

      Those with eyes open see enormous opportunities.

      • ‘See DOE website for grid scale storage installations.’

        That’s not how the internet works. You look it up and show us. We’re not looking up your stuff.

      • For gamecock, here’s a clue: Internet searches are your friend when keywords are provided.

        Go forth and search. Or don’t.

        Knowledge is not only power, it leads to wealth.

        As of today, the DOE database online shows USA has 467 battery-type energy storage devices installed, ordered, or under construction.

        Or you can remain ignorant and enjoy the opposite attributes.

        Your move, chief.

      • For “Doug”.

        BioSolar is UP almost 100 percent from its recent low.

        The company appears to be right on schedule in producing full-scale batteries for commercial testing, plus filing more parents.

        Every chemical engineer I know who is aware of BioSolar’s patents agreed that the world has changed. So do my electrical engineering associates. But then, what could those guys possibly know? We’re just a bunch of gullible rubes, right?

        Thought so.

        Besides, BioSolar is only one of dozens of smart investments.

      • BioSolar is UP almost 100 percent from its recent low.

        What chart are you looking at? I don’t know about your ChemE friends, but you may want to find a new investment adviser if yours is telling you BSRC is up 100%.

      • For those who are so backwards, so feeble, they cannot perform an internet search on the keywords “DOE storage database”
        type
        Seriously, I have seldom seen such a bunch of losers,

        Try those keywords. Or do you want me to type the words into your keyboard for you????

      • For Andrew, re stock prices:

        Not traded below 8 cents?

        You must inform the SEC that their reported 6 cents per share on May 15, 2015 needs a climate-Warmist adjustment upwards.

        Thanks for the laughs, Andrew!! Seriously, where do these experts in stock markets come from???

        There’s also a reported “52 week range” that shows 0.01-0.33.

        Please inform the SEC of their error and demand they adjust that upwards so you can be correct.

        Thanks for playing, but please don’t use your rent money in the stock market.

    • Roger,
      The economics don’t matter as long as the EROI for solar power is negative. And given the low energy density of solar, I can’t see that ever changing. That is the 800lb gorilla in the room that none of the solar power pushers want to talk about. BTW, wind power is not much better in this regard.

      • For Paul Penrose, re EROI vs economics.

        Please don’t mention EROI or EROEI. It is a sure sign of massive ignorance.

        Nobody uses that metric who is serious.

        Economics is all that matters, after safety and reliability and not poisoning the planet.

        Wind and solar are ultimate examples of taking unlimited amounts of free energy then converting them to a smaller fraction of valuable energy.

        The fact is that $5million buys 3 MW of wind turbine, installed and wired up. At 5 cents per kWh and 3500 hours average output, wind projects yield 10 percent on the overall investment. With financing, and leveraging, much higher returns accrue.

        These figures improve each year and will continue to improve.

      • Roger says, “Economics is all that matters, after safety and reliability and not poisoning the planet.”

        Really? And you called me ignorant. Did you fall out of the stupid tree and hit every branch on the way down? How can you run a modern economy with a power source that can’t even produce enough power to build it’s own replacement, let alone surplus power for everything else? This is engineering 101, but I suppose you flunked that class.

      • for Paul Penrose, re energy economics.

        You are of course referring to a nuclear power plant, that cannot ever produce enough power, or the right kind of energy, to construct itself. How, exactly, is nuclear-based electricity going to mine uranium, refine the uranium, transport the ore, produce the steel, produce the copper, produce the cement for the concrete, then transport all the parts to a power plant site for construction, then power the equipment to build the nuclear plant?

        How, exactly, is electricity from a nuclear plant going to produce the rubber, plastics, and the myriad lubricants necessary to build the nuclear plant, the electrical conversion and transmission units?

        You are so right, nuclear plants can never, ever do that. Shut them down immediately and build no more

      • Roger,
        You are such a troll. I didn’t say anything about the raw materials. Nobody expects a solar panel to “produce” bauxite ore, but it must be able to produce enough electricity to mine it, smelt, it, etc., to produce the aluminum used to build the frame that holds the panel. Same with the glass, steel, copper, etc. The same goes for the nuclear power plant (or coal, gas, etc.): if you total the ENERGY inputs needed to build one, it MUST be less than the amount the plant will produce in its lifetime. In the case of transportation or other energy using processes that may use fuels, we are talking about equivalent amounts of electricity, not a requirement that the power plant produce oil, gas, etc. This is a necessary, and obvious, requirement for any power source in order to run a modern energy-dependent society such as ours. Otherwise it will just literally run down and collapse.

        A good analogy would be this: Let’s say you had to live off only what you could grow in your garden, but you had only your own labor to plant, maintain, and harvest it (no tractors, animals, or other people to help). If the total amount of caloric energy available in the food you grow is less than the amount you need to expend to grow it, then you are going to die pretty quickly. If it produces the same amount, you will still die, just not quite as quickly. That garden will need to provide much more caloric energy than that required to maintain it or you will have a short life.

        But I suspect you already know this and are just being obtuse to confuse those who don’t understand these issues.

      • For Paul Penrose,

        You propose such ridiculous scenarios.

        Energy on this planet is so abundant that we will never, ever run out. Your pitiful garden example is not a human energy issue, it’s a sunlight and nutrients issue.

        Of course there are desert areas with inadequate water where humans die from lack of food in the garden. Polar areas also.

        The issue is producing safe, reliable, affordable and environmentally nondestructive electricity. Stick to the issue. But, you cannot do that and win an argument.

        We use more-than-abundant and therefore cheap energy to produce wind turbines and solar PV plants that then yield very cheap and reliable electricity for decades. It’s all in the economics.

        Perhaps you don’t understand economics. Or, perhaps you have been lied to by others and cannot accept being wrong.

        EROEI is a complete non-issue. Free energy overwhelms the Earth via wind, solar, geothermal, ocean and river currents, river elevation changes, tides, waves, plus a few more.

        Clever engineers find ways to use abundant and cheap energy to produce valuable but scarce energy. It’s all about the economics.

      • Roger,

        If BioSolar is the next big thing, then why is the market cap (value shareholders put on the entire company) only $1.6 million. If this was the next big thing, I would think the value would be in the multiple billion range.

        Don Rady

      • For Don Rady,

        “If BioSolar is the next big thing, then why is the market cap (value shareholders put on the entire company) only $1.6 million. If this was the next big thing, I would think the value would be in the multiple billion range.”

        The company is in the early stages of moving the battery from scientific discovery to patent protection to bench-scale prototype, to commercial testing. The science received a Nobel Prize. The bench-scale prototype performed better than expected. Commercial testing is imminent.

        Many finance types have zero technical knowledge and cannot assess future value. They exercise caution because of bad experiences due to unwarranted hype from con-artists over many years. This presents a good opportunity for savvy technical people such as engineers, my colleagues, to invest early at a low price.

    • One of the problems discussing renewable energy is mixing economic considerations with the assumption that we “must” reduce CO2 regardless of cost. If we dispense with that assumption, renewable energy looks a lot worse. And battery breakthroughs don’t really make a difference. Assuming you have solved the grid storage problem, it would probably be better to put the batteries on-site with large base load plants instead of propping up intermittent sources like wind and solar.

      A battery system only helps if there are times you have a surplus you can store that would otherwise be wasted. PV Solar never produces power at night, so to get 24×7 power you have to have roughly three times the raw capacity as your average load and roughly twice the battery storage as your average load. So what’s the capital cost of a 24×7 average 100 MW solar+battery plant vs. 100MW CCGT? The batteries would have to be extremely cheap to even consider this.

      Wind is the same way; batteries just smooth the output so it’s less disruptive to the grid.

      On the other hand, if you assume cheap, hi-density batteries, you could reduce or eliminate peaking plants. It all comes down to the cost of a given amount of battery capacity vs. that of a peaking plant you can replace. At a low enough cost, batteries would win; I don’t think we are anywhere near that point.

      But better batteries just make intermittent sources less of a problem, not more of an asset.

      (Please excuse typos; I was rushing to finish this before the battery in my new Samsung explodes …)

    • There are “those who understand the game”, those who pretend to understand the game, and those who pretend there is a game. The WSJ article makes clear that the venture capital folks – who are VERY good at ‘understanding’ games like this – don’t think there is a game to be had which will make a profit. Not in the foreseeable future. No profit – no investment opportunity!
      The key is in the last paragraph quoted from the WSJ article. It is impossibly difficult to try to invest high risk capital into a market where the product (energy) already is sold with razor thin margins due to effective competition and government regulation. Even IF the new concept is successful the energy product cannot be sold at a rate which will produce the profits necessary to pay back a significant fraction of the risk capital.

  16. Cost per watt of solar installation could be $1 or $.10 or $.01. It won’t matter until panels that generate in the dark are developed. Nameplate rating does not guarantee useful energy production.

    • Roger says! “Just set up a bank of electric lights over your PV panels”, “incandescent work best!”

    • I’ve been searching the net for articles with actual numbers. I found that the current and claimed for the future are $500./kWh down to $250./kWh and 92% efficient. They are not clear on whether that includes the inverters, but let’s be charitable and assume $250./kWh and a 7 year life. 365 days/year * 7 years is 2555 cycles. $250/2555 /.92 is $.106 per kWh. That needs to be added to the wind or solar generation cost. Not economically competitive, I’d say. Likely all those battery installations the utilities (maybe) are purchasing are the result of government mandates rather than economic viability.

      • You fellows might be surprised by the facts in this government report:

        “U.S. Photovoltaic Prices and Cost Breakdowns: Q1 2015 Benchmarks for Residential, Commercial, and Utility-Scale Systems;”

        Donald Chung, Carolyn Davidson, Ran Fu, Kristen Ardani, and Robert Margolis
        National Renewable Energy Laboratory

        Results show installed PV cost for grid-connected 100 MW systems in 1Q 2015 of $1,770 per kW.

        Read em and weep. Those costs are falling with each year, as sizes increase and volume increases.

  17. “The tools that you design, the financial structures that you develop, the blends that you are able to put together, all of that, in the next five years, will decide the quality of certainly the energy and certainly the quality of the global economy for the next thirty-five years, and hence the quality of life for everyone else for hundreds of years.”
    – Christina Figueres
    The New Yorker – The Climate Summit of Money

    I can think of a few invented financial structures – it doesn´t always turn out well.

    Let us hope that Christina Figueres is not appointed to Secretary-General of United Nations.

    Personally, I would never vote for her – If I were allowed to vote.

  18. I would be looking at DNC insider trading on this issue too…

    Just in:

    HOT DNC Leak Shows Strong Indications of Insider Trading

    http://www.economicpolicyjournal.com/2016/09/hot-dnc-leak-shows-strong-i

    Matt Forney writes, “I’ve obtained evidence via Wikileaks’ recent DNC leak that the Democratic Party may have been engaging in insider trading, which is illegal.”

    Forney goes on:

    In the recent DNC leak, there is a folder labeled “CNBC,” containing three files with information on stocks and equities.

    I consulted a financial expert on the stock info and here’s what he initially said:

    Okay, so it looks like the data is based on earnings plays. The DNC or someone at the DNC is making stock trades based on earnings dates… for some stocks that are highly risky. Could be signs of insider trading. The equities file seems to be what they are holding long term…

    My contact also pointed out that Smith and Wesson was on the stock list, implying that the DNC sought to make money off of Obama’s gun control policies:

    They were even in Smith and Wesson. Obama introduced gun control laws that July prior to earnings. Gun control equals increased gun sales based on what I’ve seen historically. Increased sales equals increased earnings.

    My contact summed it all up by saying that the stock spreadsheets look like insider trading:

  19. “Two experts say high costs and low returns sent venture capitalists fleeing. A new funding model, they say, is crucial.”
    A new funding model will not alter the Cost/Benefit ratio, and the Federal Subsidy Faucet is going to run completely dry sooner than most expect.
    Renewable have always had a high start-up cost because of the advanced technology required, including the rare and expensive resources (i.e. rare-earths for magnets), and they are producing a product (electrical energy) that is already available aplenty and affordably.

  20. The high multiples were supposed to be assured via climate fees and taxes at the federal level. That has not happened although many billions have been wasted to keep the scheme from total collapse. Look at Mr. Musk who has received so much tax and ratepayer money but finds his businesses cash strapped.

    Information technology was adapted by an eager market. Green technology has to be forced from the top. The green investment story is the housing scam all over again.

  21. Third, energy companies or clean-tech companies were going into markets that are legacy industries, for which a product already exists that does a pretty good job.

    Well, duh! They just figured this out now? So rather than invest in “clean” technologies to produce electricity, we should be looking for clean ways to produce something that can replace electricity? That would indeed be a game changer (and a killer investment), but most likely much further out even grid-scale storage.

    • They’re working on it. In 20-30 years we will replace electricity with human muscle power and horses!

  22. Hot off national news New Zealand : The company running the railways have given notice that they are considering mothballing the electrical system (where it is used) and reverting to all-diesel. 75% of our power comes from renewables (hydro, geotherm, and a little wind)

    The green scream is imminent

  23. Someone may have noted this above, but VCs are forward-looking. They’re put off investing in new “renewables” schemes by the possibility of a Trump presidency.

    If he’s elected, no more tax subsidies for uneconomical energy. The tax trough is empty, and there’s no return on investment by way of enforced tax-payer money-transfers. VCs know that.

    If Hillary Clinton gets elected, the money returns, big-time. Expect a VC stampede to get in on the ground floor of the new vein of tax-gold.

  24. When has government mandate been required to compel customers to buy their IPhones, tablets, laptops, flat screen TV’s and the like? Erm, never. And for ‘renewables’? Every single time. Without legislation and subsidy ‘renewables’ are dead in the water. Lousy, contrived and flawed business plan and model, because it’s a lousy and flawed product. The end.

  25. As Hayek emphasizes , State Force destroys market information .

    As long a the State subsidizes , mandates , or otherwise distorts the computations of the market , we cannot clearly determine the viable niches for various sources of energy .

    • But Bob

      Experience tells us that the intervention by the state is a dead giveaway for the underlying lack of viability.

  26. A note to mikewaite and mikerestin…

    Neither Cameron nor Obama can be Secretary General of the United Nations because the UN Charter forbids the appointment of any citizen from one of the five permanent members of the UN Security Council to that position.

  27. Eric Worrall is right about renewable energy using things like solar and wind but is dead wrong about the possibility of a profitable breakthrough.
    Several companies are working on LENR (low energy nuclear reactions) and I expect to see a commercial unit in 6 – 12 months.
    The US Defense Threat Reduction Agency released a report a few days ago that confirms Pons & Fleischmann’s original cold fusion study. Why now and why wait so long is not known.
    http://lenr-canr.org/acrobat/MosierBossinvestigat.pdf

    Mr. Worrall suffers from a religious belief that LENR is pseudo science that reminds me of the mind set of global warmists, refusing to look at the data.
    I won’t repeat what I have already written on the subject unless someone requests it.

  28. Educating politicians is expensive. They pay up front using our money and they learn slowly. By the time they understand the problem they are voted out of office and a new bunch of idiots take over.

    • These tax payer funded games mean nothing.
      Uber rich liberofascist states like California and Germany ruled by eco-luvvies who can afford paying 10 times more than everyone else for electricity are not the real world.

  29. History repeating itself. The early bird (like Al Gore) gets the worm and the ‘johny-come-latelies’ do their dough.

  30. I don’t care how much renewable electricity gets built between now and 2200….the bottom line is that without a MASSIVE investment in Nuclear…we will all still be driving fossil fuel powered vehicles, airplanes and ocean liners.

    Period. No amount of solar or additional bird choppers will ever come even close to providing enough power for 350 million EV’s….not even in your great great great great grandchildren’s time….

    Nuclear and Only Nuclear has the ability to do that…got a cabin..great buy 3000 Watts of Solar and 12 Starrett Batts….good to go. But industrial scale? …nope – ain’t happening

Comments are closed.