This paper discusses issues with regard to solar energy installations in Georgia and the controversy of the Georgia Public Service Commission mandating a 500 Megawatt utility-size solar plant be built. These issues apply to all states in their considerations of renewable energy portfolios.
The Georgia Public Service Commission is scheduled to vote on allowing utility-scale solar plants July 11, 2013. The Commissioners state they don’t want any subsidies for the plants or upward pressure on utility rates. I can not vision any way utility-sized solar systems would not require subsidies or increased utility rates.
I am a landlord whose business allows me to take advantage of tax deductions and possible tax credits not available to the average homeowner. I considered installing solar panels on the roof of my property back in 2008 or 2009. The benefits are described by the following:
A three-kilowatt system was going to cost $24,000. There would be a federal rebate of $7200; a Georgia rebate of $8400, and deducting system cost on state and federal income taxes by depreciation. With a Georgia tax rate of 6 percent and a federal tax rate of 20 percent, this would have saved another $6000 or more. Any electricity I didn’t use, Georgia Power is required to pay 17 cents per kilowatt-hr. This is a money maker. Taxpayers would have paid almost the entire cost of the system. Rate payers would be subsidizing receiving about triple the value for excess power rebates. In addition, ratepayers would have to make up for reduced payments to Georgia Power supporting new transmission lines, transmission line maintenance from frequent power outages due to acts of Nature, and business costs for the utility. This is due to reduced purchases of electricity due to solar panel production.
I didn’t build the system due to worries about problems if I needed access to the roof–like new roofing. Additional worries were due to possible damage to the system by falling tree limbs in my heavily forested neighborhood, damage from hail storms, and cleaning snow, pollen and leaves off panels during season changes.
The Georgia total solar rebates are limited to $5 million per year for residential and $5 million per year for commercial solar systems. Due to high demand, these rebates are used up for the future.
It is this type of economics that enable stores like WALMART and IKEA to put 1 MW solar systems on their roofs. It takes about 70,000 sq. ft. of solar panels for 1 MW. These monster stores have the available roof area. They are making money off taxpayers and rate payers from the subsidies and Georgia Power paying triple the value for excess electricity stores don’t use.
Public Service Commissioners worry about these stores 1 MW plants affecting Georgia Power’s operations. I don’t think they will be big enough to disrupt electricity distribution. However, stopping the 17 cents per kilowatt-hr. payback for unused electricity and the incentives are gone. The stores apparently testified in the May Public Service Commission hearings to get their payoff.
The public has almost a mystic opinion about the merits of solar energy which is thought to be some marvelous scientific invention that allows free energy from the sun to be available in the form of electricity at negligible cost. This opinion may be due to the media’s fascination with solar energy and promoting Obama administration energy policies not allowing criticisms be cited. Solar energy is not a benign, inexpensive energy source as shown in my article “Solar Energy Net Energy Yields and Toxic Waste Problems.” Solar cells contain toxic chemicals such as cadmium or silicon that require care in their construction and disposal. Most solar cells are constructed in China today which does not have as stringent environmental rules found in the United States. This provides a cost advantage which is presently being challenged by imposing a tariff on Chinese solar cell imports. There appears to be no considerations of disposal of solar panels after their useful life has been exceeded. This type of thinking has led to many obsolete wind turbines on display around the country.
Considerable energy is expended making solar cells in which an Australian study estimated to require 1000 kilowatt-hr. of energy per square meter of solar panel. Since solar panels typically require 7 square meters per peak kilowatt, the energy requirement may be 7000 kilowatt-hours. The website SunnyPortal displays operating data for solar panels in the Atlanta, Georgia area. The data shows solar panels produce from 1000 kilowatt-hrs. to as high as 1400 kilowatt-hours per year. Using the average value of 1200 kilowatt-hours it would indicate it takes as long as 6 years before a solar panel will produce more energy than consumed in its construction.
Solar, and wind, energy systems have outputs that are proportional to the area they cover. This is in contrast to nuclear or fossil fueled energy systems whose outputs are proportional to the volume of the system. Thus there is little cost advantage per unit of energy output in building larger solar systems like going from 10 Megawatts to 100 Megawatts. For conventional power systems a ten-fold increase in power may only require a seven-fold increase in cost. Another problem with energy systems whose output is proportional to area is the large land area required for substantial power generation. Solar systems are requiring 5 acres per Megawatt for utility-sized solar farms. A 500 Megawatt solar farm would require 2500 acres; but due to unfavorable sunshine in Georgia this power plant would have an output comparable to a 80 Megawatt nuclear or fossil-fueled power plant.
Public Service Commissioners are concerned about the federal government cutting off coal use. Let’s go back to 1950 for power generation in Georgia. All electricity was from coal and a little bit of hydroelectric. Georgia got along fine in spite of United Mine Workers chief John L. Lewis threatening strikes and cutting off all coal mining. Coal was essentially the only fuel source for power generation. In 2013 natural gas is available everywhere and the country no longer needs coal in spite of its vast reserves that would last for more than 400 years. On top of abundant natural gas availability, Georgia Power has 4000 MW nuclear to add to their supply and will have an additional 2400 MW nuclear after 2018. Georgia Power has too much generating capacity for its needs. Adding more solar will mean shutting off existing capacity, some of which is in spinning reserve to make up huge losses of electricity when clouds pass over large solar plants.
Another argument for solar power is it provides electricity when Georgia Power needs it most during peak use. Georgia Power’s summer demand has a minimum at 6 a.m. in the morning and a maximum at 6 p.m. in the evenings during weekdays when people come home in the summer and turn on their air conditioning. Solar plants have no power until about 9 a.m. in the morning, hit their peak at 1: 30 p.m. when the sun is directly overhead, and then decreases to zero around 7:30 p.m. Examining operating data on solar plants in the Atlanta area on SunnyPortal, it shows solar power outputs at 6 p.m. range from half their peak output to as low as 15 percent peak output. Thus a 500 MW solar plant’s output will range from 80 MW to 250 MW at the time of peak power demand. This is a big loss of output at the most critical time. Another problem with solar plants assisting peak power demands is afternoon rainstorms completely eliminating solar plants output when it is needed most.
Due to their unreliability, solar plants do not allow utilities to reduce their generating capacity. Because of the need for rapid response to sudden cut off of large blocks of solar energy, utilities need equipment operating in modes that are not the most efficient use of fossil fuels like natural gas. This increases fuel costs. For what it is worth, green house gas reductions are less than touted by those pushing solar energy.
There are no utility scale solar plants in the United States without these massive taxpayer and ratepayer subsidies. With the exception of 100 MW in South Florida and 20 MW in North Carolina, I think all utility scale solar plants are out West in regions with far greater available sunlight. Most Western regions have 30 percent greater sun availability than Georgia. It takes a blind optimist to think solar possibilities in Georgia make any economic sense when solar plants demand subsidies in areas with far more available sunlight.
Proponents of solar energy in Georgia use “economic models” to justify the economics of their systems. I can not help but laugh at these remarks. President Obama uses “climate models” to justify his attempts to stop use of coal for power generation and future attempt to stop use of the rest of fossil fuels. NONE of the “climate models” are able to make predictions that match actual conditions. The “economic models” to justify solar energy have to be just as silly. If you want proof, examine the “economic model” used to justify the Dublin School Board’s 25-year lease of electricity from a 1.1 MW solar plant sited on the Dublin high school grounds.
A final comment can be made about President Obama’s speech on climate change June 25 in which he plans to use the EPA to force utilities to abandon coal for electric power generation. Solar energy, as a part of renewable energy portfolios, is a solution for an energy source to replace coal. Efforts by Public Service Commissions to increase adoption of solar energy can be interpreted as an endorsement for President Obama’s energy and climate change policies. This may provide ammunition for even more onerous energy policies.
James H. Rust is a policy advisor for The Heartland Institute, a retired professor of nuclear engineering, and an outspoken critic of unnecessary alarmism over man-made global warming. He funds several scholarships for students majoring in chemical engineering at Purdue University. He currently is delivering a talk titled “America’s Failed Energy Policies and The Reason Why.”
