Posts Tagged ‘solar economics’


Saturday, November 15th, 2008

In the middle ages, early “scientists” spent years in medieval laboratories experimenting with crude instruments and processes in search of the holy grail of old world chemistry: a method for turning some common material into gold. These ancient alchemists labored in vain, of course, as not a single ounce of the precious material was ever produced.

If ever such a method was needed by the nations of this world, it is now. We are presently pouring billions (trillions?) of dollars into the economies of this planet in a desperate hope that we can restart the machinery of production that has propelled our civilization forward ever since Adam Smith cried out, “Gentlemen, start your engines!” The problem is that it’s not real money we are pouring into the tank, but “tomorrow money”.

Mankind rides a perilous plane whose engines are sputtering. It doesn’t take an aerospace engineer to tell us that if we don’t get those engines up and running soon, the plane is headed for an unpleasant encounter with the ground. So our governments are headed out onto the wings with their cans of make-believe gasoline, hoping that somehow, some future generation will come along and retroactively fill those cans with real hard-earned dollars. Oh, where are the alchemists when we really need them? If only we could create money out of thin air.

Well guess what, Yankee fans…we can!

I want you to picture an ancient alchemist laboring away in a modern garage — -think of a white-bearded Merlin hammering on a sheet of metal, and painting it with an exquisite coat of silver. He labors well into the night, and finally, he hauls his magic machine out onto the driveway and sits, waiting for the sun to come up. Slowly, the rays of the morning sun fall upon his magnificent invention. And lo and behold — -a gold coin drops to the pavement!

Merlin! You’ve done it! You’ve turned sunlight into gold!

Does it sound like fiction to you? A legend, perhaps? All too good to be true? Well, it is true. You can prove it to yourself by mounting your own solar cash machine on your roof — -put a solar thermal collector up there and watch your hot water bill drop like a stone. It will literally turn sunlight into gold. The $20 or $40 or $70 a month that you used to send off to your local gas or electric company now stays in your wallet. Sunlight falls on your roof and money appears in your wallet! It’s solar alchemy!

The same thing happens if you install a solar electric panel, or a wind generator. At then end of the day, real money shows up in your wallet.

So what are the considerations here? Clearly, if Merlin’s Magic Machine costs $100,000 and it only drops a dollar a day on the pavement, there wouldn’t be a big rush to buy one. Conversely, if it cost $100 and produced $10 a day, you’d better watch out for the stampede. So the very first consideration is this: can the machine pay for itself from the money it generates? Our experience with wind generators is a resounding “Yes!”. So, too, solar pays for itself over its lifetime, and then goes on to generate free money.

The implications of solar and wind alchemy are profound. Devices can be created and placed in the sun or the wind, and real capital is produced for mankind. The more devices, the more capital. This is a simple fact that our governments need to get a grip on. Instead of incurring debt for our grandchildren to pay off, try planting solar and wind seeds that will grow into money trees, ready to harvest by the time they are slammed with the credit card bill we have run up on them.

It is obvious that mankind is going to have to undertake a transition to a non-fossil reality. Our planet is going to die if we fail to act on this truth. What is important to recognize, and what I hope this blog comment brings home through its simple analogy, is that this transition is CAPITAL PRODUCTIVE! We are going to need trillions upon trillions of dollars in the future. If we simply start the process of harvesting sunlight and wind on a massive scale, the money will be there when we need it.

So, my dear government officials, don’t put imaginary gasoline in the sputtering engines. Try sunlight instead.



Saturday, November 8th, 2008

Congress intends to pass another economic stimulus package to get our economy up and running. Let’s not make the same mistake as the last one.

Last time, we all got a check in the mail from Uncle Sam which we could spend any way we wanted. Though I haven’t seen any studies on where the money went, I’ll bet a good share of it ended up in China, thanks to Walmart, Home Depot and a thousand other shopping outlets that trade in “cheapest” products. No doubt countless billions ended up in Saudi bank accounts.

I suggest we do it different this time. Instead of giving cash away, give away insulation.

There are tens of thousands of homes and businesses out there that burn foreign oil every winter just to keep their occupants warm. I drive by them every December morning and see their roofs glistening wet instead of frost-covered — -a tell-tale sign that there is inadequate insulation inside or none at all. As long as the government is going to “give away” money, I suggest they do it in a manner that gives money back.

Consider an oil burning home. If you vigorously insulate it, it will burn less oil. It is as simple as that. But the implications are profound: Every month, month after month, year after year, less oil is imported to heat that house. That means that less money is being shipped from the U.S. to the Middle East (you know, that part of the world where Americans are held in such high esteem). And ask yourself, if money isn’t being sent off to Saudi Arabia, then where is it going? Well, J.Q.Public will have a few extra dollars in his pocket each month to spend on stimulating the economy (or maybe even putting in a savings account!). And this will go on month after month, year after year. And did I mention, there will be less CO2 rising from J.Q.’s house month after month, year after year?

This simple solution ends up killing an entire flock of birds with one stone: 1) it reduces our dependence on foreign oil and helps our balance of trade; 2) it gives J.Q. a tax-free raise that continuously stimulates our economy forever; 3) it gives the insulation industry a giant shot in the arm, and very importantly, 4) it reduces global warming.

It should become immediately apparent that insulation is just the simplest avenue available to Congress to create real stimulus. The same result can be achieved by giving away solar collectors that would turn off hot water tanks from Seattle to Sarasota. Again, CO2 is reduced, fewer oil tankers ply the Atlantic, and J.Q. rushes out to buy a new Chevy “Volt” with the money he saves on his oil bill.

Win. Win. Win

So, Congress, as long as you’re going to give money away again, try putting it where the sun shines.


Suggestion No. 1: Put Solar Panels Where the Sun Shines

Sunday, November 2nd, 2008

In the weeks and months ahead, I hope to focus in on suggestions for our newly elected president and congress regarding actions they might wish to consider in addressing the world’s climate crisis.

My first suggestion is to establish a program whereby citizens who live in less than optimal solar zones might still be able to install solar collectors in areas where their energy (and hence financial) return is maximized.

I have been driving “Sparky”, my electric car for the past ten years.It is fast, reliable, and financially a success, particularly at gas prices above $4/gallon.Last year, in an offering to CNN’s Youtube Debate, I proposed to ask the candidates the single question:

“Why aren’t we all driving on sunlight?”

The concept is simple:every electric car is capable of “running on sunlight” through the simple expedient of using solar panels to capture sunlight and delivering the electricity they produce to the batteries of the car.

In practice, it’s a bit more complicated than that.Several points need to be made here:

1) Can a car run on solar cells attached to the car?No.An important point needs to be understood — -there is only so much energy in a square foot of sunlight.Even if every square inch of a modern car’s surface were to be covered with some kind of “super solar cell” (one that could convert 100% of all the sunlight falling on it to electricity), it would not be able to supply the car’s energy needs.

2)How do you supply electricity to your car if your panels are at home and the car is on the road?You don’t.Driving on sunlight does not mean that a car is continuously hooked to its panels.Instead, it works like this:your panels collect the sunlight and convert it to direct current (DC).The DC current is then changed to AC current (the kind of electricity you use in running your home) by running it through an “inverter”.The inverter is then hooked directly to the electrical system of your home.What this does is to supply your home with usable electricity produced from sunlight.When this happens, your electric meter will actually slow down or even begin to run backward because you are not drawing power from your utility (“the grid”).In reality, you begin to build up a “bank account” of solar-generated electricity.The size of that account will depend upon how many panels are on your roof, and how much sunlight falls on them.Your electric car arrives home after work and you plug it in.It then withdraws the electricity you collected during the day and stores it in the car’s batteries for tomorrow’s commute.

3)What happens when the sun doesn’t shine?No problem.You install a large enough solar collector system to provide more power than the car can use when the sun shines to cover those days when no power is collected because of clouds.This is an important point to understand:a solar powered car is based upon annual solar collection, not daily solar collection.So your collector system is sized based upon the number of amp hours needed by your car in a given year.In Sparky’s case, he needs 2 amp hours of power to go one mile.If I intend to drive 10,000 miles per year, I need a system that will generate 20,000 amp hours of electricity in a year, most of which will be collected in the summer months.

It should become immediately obvious from this, that the amount of sunlight falling on the panels over as given year is the critical defining factor in the size of a solar system needed to create a truly “solar powered car”.This brings me to the specific point of this discussion:don’t put your panels where the sun doesn’t shine.

I live in Olympia, Washington.Several years ago, I was stunned to find that my city has less sunlight than any other major city in the world — -I was scanning a list of cities arranged by their solar standing, and there it was, drop dead last!My initial reaction was:Well, if I can demonstrate that solar works in Olympia, Washington, then that will show the world that it can work anywhere!Maybe that makes a great PR point, but it makes a terrible financial one — -it would only demonstrate how expensive it is to drive a solar powered car.

So that brings up the central point for policy makers:the government needs to establish a mechanism whereby a person who drives an electric car in Olympia, Washington, can buy solar panels and install them in Yuma, Arizona…or Needles, California.I submit that government needs to obtain large tracts of solar-rich land and create a “solar farm” where individual citizens can install solar equipment that sends electricity into the grid so that they can in clear conscience declare that the electricity they are pulling off the grid at their house is indeed “solar energy”.It makes no real difference that the specific electron that enters Sparky didn’t actually come from my Yuma solar panel — -the important point is that, on a national basis, I am putting as much electricity into the system as I am pulling out.

There are many advantages to this concept.

1) By centralizing the solar collectors of car owners from all over the country, a single maintenance man can service a large number of customers, reducing the maintenance costs of owning solar collectors;

2) A standardized model of collector can be decided upon which will result in the benefits of specialized large scale production (economies of scale);

3) Individual power inverters (one of the expensive components of a stand-alone system) would be replaced by large scale inverters, thereby substantially reducing this cost center;

4) Eventually, individual solar panels will be replaced by community solar collection systems (solar generating plants) which will further increase the return on the solar dollars invested.

It should be immediately apparent that this concept would not be limited to electric car owners.It is equally applicable to homeowners and businesses that want to “operate on sunlight”.While government is the logical candidate to be the entity to facilitate the creation of these solar farms, it can just as easily be accomplished by a co-op of car and/or home owners.

One thing that government can do, as a matter of policy, is to insure that the money paid per amp hour from an owner’s panel be equal to that he must pay at home when he withdraws his electricity from the local grid.In other words, retail for retail.Indeed, it seems like a great candidate for a tax-type credit that would encourage all of us to convert our cars, our homes and our businesses to solar.