fayfreethinkers.com

DAR
Favorite line: "Farmers are looking at manure piles and figuring..."

And look what they are paying for solar!



***
In Ontario, Making "Clean Energy" Pay
By Doug Struck
The Washington Post

Thursday 12 October 2006

Utilities ordered to compensate homeowners for power from solar, wind, water projects.

Toronto - Leonard Allen, who runs a small solar panel company here, finally has something good to tell callers, he says. For the first time, he can promise it won't take 50 years to recoup the money they spend on a rooftop solar system.

Canada's Ontario province has ordered local utility companies to pay homeowners or businesses for any electricity they generate from small solar, wind, water or other renewable energy projects, beginning next month.

The plan is unique in North America, but it is modeled after similar schemes in Europe that have spawned a boom in small "clean energy" projects. Critics say paying for such electricity is not the cheapest source for utilities, but advocates say it is the cleanest and most environment-friendly.

In Ontario, the program has already brought a rush of activity. Homeowners in Toronto are climbing onto roofs to add solar panels. A cooperative of small investors is raising money to build five large wind turbines to harness Lake Huron winds. Others are eyeing the locks of a St. Lawrence Seaway canal for small hydro-turbines. Farmers are looking at manure piles and figuring the profits of using organic decomposition to create methane gas that can make electricity.

"There's a tremendous interest, at all levels, from well-organized business consortiums to small homeowners," said Tim Taylor, a spokesman for the Ontario Power Authority. "The impact in megawatts is going to come from the larger projects, but there's a tremendous momentum found in small, backyard projects."

"We love the idea," said Keith Stewart, an energy specialist at World Wildlife Fund Canada. "The small stuff adds up. This model should be taken right across North America."

The growing chorus of cheerleaders for the program say it is an example of the kind of individual, grass-roots effort that many see as the solution to intractable problems ranging from energy shortages to global warming.

The Ontario program was launched after politicians promised to shut down aging coal-fired power plants but faced the reality of growing electricity demands.

Advocates of renewable energy, some of them veterans of a successful campaign to erect a large windmill in downtown Toronto, stepped in. They urged provincial authorities to use an economic spur to create hundreds of small electricity generators in hopes of avoiding building more big, expensive coal, gas or nuclear plants.

They brought Paul Gipe, a wind power expert, from California to lead the successful campaign. Gipe calls the result revolutionary: "the most progressive renewable energy program in 20 years in North America."

Gipe noted that while some local utilities in the United States allow customers to send power back into the grid, there are no programs that pay a premium for generating the electricity.

Starting in November, the 90 or so local utilities throughout Ontario will begin paying anyone producing solar power 42 cents a kilowatt hour. Wind, hydro- or bio-electric production will bring 11 to 14.5 cents a kilowatt hour.

In addition to getting paid for making electricity, homeowners and businesses slash their own electricity draw from the grid, where power sells at an average of about 5.8 cents a kilowatt hour across the province. Advocates say it reduces the burden on the electric transmission lines, encourages conservation and may save the cost of a new plant.

"Putting solar panels on the roof is a very tangible symbol of where your power is coming from," said Ron McKay, an artist and graphic designer who helped form a co-op in his east Toronto neighborhood to buy solar panels at a bulk price. "You start to conserve. You don't leave all the lights on. You change your light bulbs to efficient ones and start looking at your appliances."

Ontario's pricing scheme, called a standard offer contract, brought a flood of new interest to McKay's solar-buying co-op, and has produced at least two similar co-ops in other Toronto neighborhoods.

Members gleefully trade stories about watching their electric meters reverse on sunny days, putting electricity into the power grid rather than taking it out. "One woman said it's better than watching TV," McKay said. Another booster put a video clip of his backward-running electric meter on the Web.

Utility companies initially were wary of the administrative burden of buying power from thousands of customers. And there are technical problems. For example, utility linemen have to ensure that the small producers are disconnected from the grid when they work on electric lines.

Critics also say the cost to buy the power is higher than it would be from a conventional power plant, or an efficient big wind farm. Large contracts to build big projects is the North American norm.

Advocates counter that the prices set by the new Ontario program are too low. The 11 cents paid for wind power and small hydro may be profitable, they say. But the $10,000 to $15,000 needed to buy a typical residential solar array means it could take 15 years to recoup the investment at the price offered to sell solar electricity back to the utility in Ontario.

"It's still long-term, but at least it's not 50 years," said Allen, president of Solera Sustainable Energies of Toronto. "People aren't hanging up on me now. For a homeowner willing to invest in the future, it's okay."

Advocates like Deborah Doncaster, executive director of the Ontario Sustainable Energy Association, say they want to get the program started and expect that the power authority will increase the prices later.

Rob McMonagle, head of the Canadian Solar Industries Association, said installation companies, accustomed to doing much of their business for remote Canadian cottages, have to gear up to meet an explosion of demand in cities.

"We've had a 400 percent increase in sales this year," he said. "We couldn't have handled a 1,000 percent increase."

On the front door of McKay's home in a working-class Toronto neighborhood, a small bronze plaque proclaims, "This house generates solar electricity." Up to the third floor, through a window and out to the roof, he proudly shows off his new solar array. And he looks out over the vista of rooftops to see a future of solar panels.

"I think the government has underestimated the amount of response it was going to get," he said. "What other kind of home improvement gives you dollars in return?"

LINK

This is exactly the kind of thing the government should be doing. Instead of the current system of "carrots" to the big corporations, that make it "cost effective" to maintain the status quo, they should put in place "carrots" to individuals and small purveyors/entrepeneurs - that will always generate change - and in the direction we need to go. The government and most of the utilities will be surprised at how much energy will be generated from these home systems. When I lived in Madison, WI the city-owned electric company avoided building a new peaking plant with conservation efforts alone (selling and/or financing efficient appliances and furnaces at or below "cost" - they figured in the savings of not having to build the peaking plant). The critics who worried about all the units having to be turned off when their was trouble on the line (safety issues for the line workers) don't understand how an intertie system works - it shuts down automatically if there's a power outage. You can get a more expensive program that includes a battery backup system, in which case the home system automatically switches to charging the battery system that runs the house if the power on the lines go down. Good for Onterio - and if we can get the petrochemical industry out of office, we may (maybe) manage to do the same thing.

DAR
Perhaps of interest. Deals with the concern that Windmills kill a lot of birds.

Common Eco-Myth: Wind Turbines Kill Birds

"It's a given that anytime we post a story on wind power someone is going to comment that "turbines kill birds," suggesting that wind power may therefore be unacceptable. Compared to what? Hitting birds with automobiles (along with turtles, groundhogs, and deer)? Birds caught by feral cats? Birds colliding with buildings or phone towers? Quite possibly, a higher mortality will be attached to the transmission wires needed to get the wind power to market. Why, then, do many associate bird mortality only with wind turbines? We hope to get to the bottom of this "death by turbine" myth hole, and point to the factors that can actually be managed though public involvement.

[big snip... to last paragraph]

In the United States, cars and trucks wipe out millions of birds each year, while 100 million to 1 billion birds collide with windows. According to the 2001 National Wind Coordinating Committee study, “Avian Collisions with Wind Turbines: A Summary of Existing Studies and Comparisons to Other Sources of Avian Collision Mortality in the United States," these non-wind mortalities compare with 2.19 bird deaths per turbine per year. That's a long way from the sum mortality caused by the other sources."

They are also redesigning the tower to reduce bird mortality. The biggest problem isn't wind turbines in flight paths, it's birds nesting in the tower. Apparently fledglings aren't controlled enough to avoid the blades while learning to fly. The new design is a smooth pole-like tower, with no nesting nooks.

Okay, let me get this straight. The Ontario government is forcing electric companies to pay twice the going price to buy electricity from people who use hydro or bio generation (11 to 14.5 cents instead of 5.8 cents per kilowatt hour) and seven times the going price (42 cents per kwh) for wind power in the name of efficiency??? Duh! Obviously, the result is both more coercive and less efficient.

I have a better idea: End all subsidies to all electric generation outfits, and let the market price show what's more efficient than what. If solar panels are truly more efficient than, e.g. coal generated electricity, then the energy savings in households will induce people to put up the panels. You don't need a subsidy to distort matters. Not for big firms, not for households.

On a related note: On a Ozark Society hike (to Hemmed in Hollow) last Saturday I was talking to a chicken farmer. He told me that corn prices in the last year have doubled, almost certainly as a result of corn ethanol subsidies. Thus Tyson chicken feed was including less corn and more fillers, resulting in less calories in the feed. As a result, chicken houses had to be heated several degrees higher that last winter. The farmers are paying through the nose for additional energy for heating (natural gas in his case), and lucky if they break even on winter chicken production. Anyway, I thought this was an interesting example of the perverse effects of subsidies - how they often have unforeseen effects quite the opposite of intentions.

In the last month I've read that both China and Mexico have suspended their corn ethanol programs due to the deleterious effects on food for humans. But we've discussed this already on another thread, how corn-based ethanol is inefficient (and subsidies simply stupid), and that ethanol will not be efficient until cellulosic ethanol technology arrives.

Actually the efficiency of cellulosic ethanol has already been bypassed - and by the technology Hogeye directed us to almost a year ago - the BRI Energy conversion process. This is where I tend to go totally up the wall - WE HAVE THE TECHNOLOGY. WHY ARE WE STILL MAKING "FOOD V. FUEL, WE CAN'T DO THIS" NOISES?

Subsidies that have been turned from their original purpose into corporate wellfare is not good. I have frequently said so. It is a misuse of government, and unfortunately, once that brand of misuse starts it frequently spreads. Fascism is one of the likely outcomes, if government isn't hauled back into line in time. In my more depressed moments, I think we've gone past the point of no return. Since I love my country, I keep working (calls, emails, letters to editors) towards bringing her back.

Hogeye wrote:Okay, let me get this straight.

DAR
Okay, let's see you get something straight.

The Ontario government is [forcing utilities to pay a good rate for on site generation of solar/wind produced electricity] Duh! Obviously, the result is....

DAR
...more generation of on site, nearly pollution free, non-carbon emitting, non-smog producing, zero transmission line loss, 100% renewable, non-war promoting, non-strip mine creating, less billion $ power plant constructing, electricity.

Duh! Obviously the result is... excellent.

D.

ps I did a little fact checking and noticed that while you were "getting it straight" you screwed up the details as well. You said:

"The Ontario government is forcing electric companies to pay twice the going price to buy electricity from people who use hydro or bio generation (11 to 14.5 cents instead of 5.8 cents per kilowatt hour)

Article actually says:
"Wind, hydro- or bio-electric"

and seven times the going price (42 cents per kwh) for wind power

Article actually says:
"...utilities throughout Ontario will begin paying anyone producing solar power 42 cents a kilowatt hour."

Barbara, as I understand it, Dr. Graddy's technology is still experimental - not a done deal by any means. There's also that "faded jeans" enzyme technology that may prove better.

Sorry, I erred; it's solar power that cost 7x the amount of standard technologies, with wind, hydro, and bio only twice as much. Thus, the pricing would indicate that standard technology is 7 times as efficient as solar-generated kilowatt hours, and twice as efficient as those others. But of course, this is not accurate at all, since the "prices" of the politically-favored technologies are set by whim of ruling politicians rather than as an emergent property of many binary voluntary trades. Due to this distortion, we really can't deduce much from the pricing. We have arbitrary fixed prices which electricity firms are forced to accept due to threat of government violence. Not to mention that the prevailing technolgy (probably coal-generated) externalizes some costs.

I suppose we should be happy that rulers haven't decided to promote, e.g. the virtues of our pioneer ancestors by decreeing that cloth manufacturers must buy home-spun thread at 7 times the market price. Or that grocery stores be forced to pay 7 times the going price for vegetables grown using oxen or human muscle-powered plows. Sure, one could talk about how this replaces coal or oil mining; but one could not rationally argue that it is more efficient. One beautiful thing about the market is that, if left unhampered and property is adequately defined, it provides an objective and accurate measure of overall efficiency. But this overall efficiency is an amalgamation of all participants' demonstrated preferences. Which is why rulers, statists, and social engineers tend to hate it - it doesn't cut any slack for elites who want to impose their preferences.

Hogeye wrote: Sorry, I erred; it's solar power that cost 7x the amount of standard technologies,

DAR
No, pays 7 times.

One beautiful thing about the market is that, if left unhampered and property is adequately defined,...

DAR
We are left choking on the fumes and the land is polluted, stripmined and destroyed by corporations. But at least there are a few billionaires standing on the rubble and soot. Markets only care about greed. The populace doesn't like that. That's why they hire leaders to manage cold blooded markets and give people what they want while preserving their environment. Ontario's energy industry is heavily regulated, energy is cheap, and the strong efforts for conservation are well on their way.

But as good as Ontario is doing with these sensible and moderate incentives, they still lag behind Europe which is doing even better:

Ontario Feed-in Tariffs Could Cascade Across Nation

"Feed-in tariffs are an acknowledged mechanism that place a value on the many societal benefits supplied by solar to the grid. McMonagle said it allows for the costs to be accounted for in a similar fashion as large power generators such as nuclear or hydro and to spread that cost over the ratepayer base. Countries as diverse as Germany, Spain, Japan, and Cambodia now offer this mechanism to homeowners.

"Canada lags the rest of the world in support of solar technologies," McMonagle said. "On a per capita basis we have less than 26 percent of the installations of countries such as Austria, Germany and the Netherlands while government support for solar deployment is less than 14 percent of international averages.

CanSIA's plan calls for the installation of 15,000 systems in Ontario by 2015. More importantly, it will increase annual sales from the current level of 50-60 grid-connected systems sold per year to annual sales of 5,000 per year by 2015, according to the organization.

Ontario, predicts McMonagle, could provide the starting point in Canada for solar to become a major energy provider and is recommending that other provinces consider implementing feed-in tariffs to support the growth of solar across Canada.

"By 2015 we foresee a vibrant solar market in Ontario -- with the installation of over 14 MW of new solar power annually with sales doubling every three years," McMonagle said."

DAR
Ontario is off to a great start, now if they only had more sunshine. Look at the picture of solar panels at the top of this thread. Look at the smog off in the distance. Notice how cloudy it is (I lived in Ontario for 9 years).

DAR
From another interview with this fellow Rob McMonagle, the executive director of the Canadian Solar Industries Association.

***

MG: It's interesting because a lot of people think it's not practical to afford these products. Solar for a long time was deemed to be out of the range of just about everybody.

RM: Well, the main issue is we're the only energy source where you have to buy all your energy upfront. When you buy a solar system, you're buying 20 to 40 years worth of energy whereas the government and the large utilities are able to finance the cost of large power plants. There is, however, in the works what's called a standard offer program which allows people to quickly pay back your investment so that you've got that long-term reliable source of power.

MG: As I suggested in the introduction, you believe that solar power is becoming affordable and practical. But it's also inevitable, you say, that there's a point at which this is just the way of the future. Why is that so?

RM: Well, we're seeing that around the world with the support of governments. For example in Austria, which has a worse solar resource than in Canada, one out of every 7 homes has solar. In Spain, it's legislated. All new buildings have to have solar on it. They're expecting 100,000 systems installed next year alone in Spain whereas we only see 20 or 40 a year in Canada.

MG: So what could the government do to get behind this further - to help convince people that this is something they might install in their own homes and give them an incentive?

RM: There's a whole range of policy initiatives they can look at. The Ontario government has been very progressive in offering a standard offer program which allows people to sell their electricity back into the grid at a good rate. That will be available this fall sometime. Low interest, long-term loans are very supportive. Changes in the building code which require new houses to have solar on them.

LINK
***

If we had a program that required utilities to pay a decent rate for customer created electricity I would definitely make the investment. I have talked to the owner of Stitt Energy Systems in Rogers. They design energy efficient homes, with solar. He says Arkansas utilities don't pay jack for energy you create, and net metering isn't even available in a lot of areas.

D.

Hogeye> One beautiful thing about the market is that, if left unhampered and property is adequately defined,...

Darrel> We are left choking on the fumes and the land is polluted...

That's where the "property adequately defined" comes in - to prevent such externalities. The choice is to either define property better, or set up authoritarian rulers to make arbitrary decisions. Libertarians like me prefer the former. See the discussion on the ridiculous corn ethanol subsidies for an example of regulation by ruler whim and crony payoff.

Darrel, there are sunk costs in virtually every type of energy production. Contra McMonagle, solar is no different in this regard. In Costa Rica, many people, especially those off the grid, install solar panels to power their homes. No subsidy is necessary when it is truly efficient, like in CR where the sunshine is predictable and plentiful all year. Basically, Ontario is subsidizing an unproven and so far inefficient fad, and plundering the general public to do so. Subsidies for hand-looms and oxen plows next?

If you can generate excess electricity, sell it to your neighbors. You shouldn't use the State to force your competition to buy it at inflated prices!

People install solar in Costa Rica because of the cost of running electric lines to hook up to the grid. That's where solar got it's real start in America as well - people living off the grid who couldn't afford to run the lines to hook up to the grid, but wanted electricity.

As to BRI Energy - it is totally a "done deal" - just needing startup funds to build the first commercial plants. They've gotten some federal funding - actually federal loan guarantees - and will be breaking ground on at least 2 and possibly 6 new plants this year which should be online by mid 2009, at the latest. One of the plants will be have city trash/sewage as feedstock. The other that I know of I'm not as happy about, since coal is the feedstock. However, if you are going to use coal, this is the best way to do it. No pollution in the energy usage ("just" the mining), since it isn't burned.

BRI Energy is a "done deal" if you mean that it is proven possible to convert cellulose stock into ethanol using Dr. Graddy's process. It is not a "done deal" if you mean that the process will be cheaper for producing energy than alternate technologies (like blue-jean enzymes) or conventional fossil fuels. A lot depends on the economies of scale when ramping up to real industrial applications.

Darrel> We are left choking on the fumes and the land is polluted...

That's where the "property adequately defined" comes in - to prevent such externalities.

DAR
As if the Superfund mess could have been prevented by a massaging of the definition of property. Absurd. Definitions don't change the fact that unfettered capitalism has no compunction about despoiling/raping land and moving on to the next if that's the best and quickest way to make the most money (and the state isn't there to stop them).

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The Superfund law paid for toxic waste cleanups at sites where no other responsible parties could pay for a cleanup by assessing a tax on petroleum and chemical industries. The chemical and petroleum fees provide incentives to use less toxic substances. Congress provided the oil industry an exemption of liability for the cleanup of petroleum in return for a fee on petroleum products to fund cleanups of other toxic substances.[3] Congress has chosen not to renew these taxes, and the Bush Administration is the first administration in the history of the program to oppose making polluting industries fund the Superfund toxic waste cleanup program.[4]

Superfund also provides broad federal authority to cleanup releases or threatened releases of hazardous substances that may endanger public health or the environment. Over five years, $1.6 billion was collected, and the tax went to a trust fund for cleaning up abandoned or uncontrolled hazardous waste sites. CERCLA was later amended to increase the amount of the 'Superfund' to $8.5 billion.

There are hundreds of Superfund sites across the nation.

-ibid

BRI Energy is a done deal. Once the original build/startup money is found (from whatever source - public, private, or a combination) and the plant goes online, the waste heat is used to make electricity, 60% of which is used to run the plant. The feedstock is stuff currently costing money to be hauled off, so is cheaper than mining or drilling for fossil or nuclear fuels - and will solve the "where do we put the garbage" problem of both cities and agriculture. Even if we get back to sane-sized agricultural units (previously known as farms) that can actually utilize all their own waste as fertilizer for the crops to feed their stock, cities will always need a place to put garbage and sewage.

As to no longer taxing polluting industries for the superfund - the Rs in general and W in particular have spent their entire lives refusing to take responsibility for their own actions. Once in power, they had solid fiscal reasons - campaign financing if nothing else - to extend that to their cronies in the petroleum and other major polluting industries.

Barbara, I truly hope your predictions about the future energy market turn out to be correct.

Hogeye> That's where the "property adequately defined" comes in - to prevent such externalities.

Darrel> As if the Superfund mess could have been prevented by a massaging of the definition of property. Absurd. Definitions don't change the fact that unfettered capitalism has no compunction about despoiling/raping land and moving on to the next if that's the best and quickest way to make the most money.

And why is land despoiled/raped? Because it is unowned, resulting in the tragedy of the commons. Or because the State "owns" it, so there is no individual or firm with incentive to protect the capital value. Clear definition of property rights would largely prevent such destruction, and force polluters to pay damage to violated property owners.

People who value freedom prefer the property-rights model to the regulatory model to handle pollution (and more generally "third-party effect") problems. For more info, google "free market environmentalism."

>Clear definition of property rights would largely prevent such destruction, and force polluters to pay damage to violated property owners.<

Provided the polluters are still around and you can file a valid claim against them before they take bankruptcy or just dissolve their corporation. To effect what is stated above it would be necessary to strip the "corporate veil." Good luck with that one.
_

Good point; no one said it would be easy to achieve a just society.

Fortunately, most polluters are land-bound, with their assets quite easy to locate. There's the smokestack; there's the pipe going into the river. Legal systems could compensate victims with the land and buildings that were polluting. But currently it's not a matter of tort law (the property rights model); it's a matter of getting a government bureaucracy, usually inefficient, to enforce regulations, usually vague. The actual victims (remember them?) are left out in the cold.

Most of those "land-bound" polluting factories are owned by legally-protected corporations - many of which are offshored. Nobody ever said bureaucracy was perfect - just better than what's in 2nd place (no controls at all). As I have said before, the laws are created in response to a condition that is/was not otherwise being addressed.

1st place is: legal systems with adequately defined property rights. Adding kludges and more coercion to the statist quo legal system is clearly worse. It is unclear whether a statist legal system with poorly-defined property is better with or without added kludges - the kludges may simply obfuscate the root problem and prevent necessary legal reform.