[ExI] The silent PV revolution
spike66 at att.net
Thu Mar 29 20:14:39 UTC 2012
>. On Behalf Of Alfio Puglisi
Subject: [ExI] The silent PV revolution
>. electricity markets this summer: there is a non-negligible chance that a
major country is going to have so much production from solar photovoltaics
that it will have to *export* a sizable fraction of it.Traditional energy
giants are lobbying like hell the government to regulate the market.
Ja, then what happens? The power companies which have had legislative
mandates to buy a certain amount of power from renewable sources gets all it
is required to buy, forcing the price of any additional solar power
downward, which has an immediate impact on the value of solar installations.
Before they were able to know the exact price at which the full output could
be sold, and also to make a very good estimate of how much power it would
make, which yields a highly accurate estimate of the income from an
installation. Couple that with a highly accurate estimate of the cost to
install, and the cost/risk/benefit equation is well understood and easily
Now, as soon as solar power saturates that market and the power must be sold
at a lower rate, then everything changes. You introduce a risk term and a
reduction in revenue.
I have a friend who is putting in a huge solar installation in eastern
Oregon. This concern (that the local power company will get all its needed
expensive renewable power, then offer him coal-gen prices for any above
that) keeps my friend awake at night. His PV farm is the first to go in,
but if a neighboring farm decides to follow his lead (farmers are bad to do
that) then both eventually go broke. His long-term financial survival
hinges on convincing all local land owners that he is not making money on
>. or it's just me having unhealthy interests? :-) Ciao, Alfio
Healthy interests. Think long and hard on this. You are on something
critically important: the first ground based PV installations are highly
profitable, because they have legislated mandates for their product, they
rely on existing electrical infrastructure for load leveling, they can sell
power to the local utility for peak prices and produce it at low cost. The
PV-farm owners provide baseline product and sell it at peaker prices. Cool!
But as more ground based PV infrastructure goes in, the value of it goes
down. The power company needs to supply power at peaker cost, and in some
cases (rainy or snowy days) end up supplying power generated by peaker
technology and selling it at baseline prices.
This will hurt those power companies, aaaannnnd. the big mean power company
Currently we talk so much about PV dollars per peak watt, and ignore the
costs associated with load leveling, since at first, someone else pays for
it besides the PV-farm owner. As there is more of it installed, the PV
owner pays. Then she goes bust.
Alfio, fire up your spreadsheet, me lad. Find out all this the same way I
did: calculate your way to wisdom.
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