Your money at sort-of work.
Obama awards $2B for solar power, hails new jobs
WASHINGTON – The government is handing out nearly $2 billion for new solar plants that President Barack Obama says will create thousands of jobs and increase the use of renewable energy sources.
Obama announced the initiative in his weekly radio and online address Saturday, saying the money is part of his plan to bring new industries to the U.S.
The thing that immediately leaps to the front of one’s mind- if this is such a great investment, why is the government investing as opposed to private capital investing in it?
$2 billion is going to two companies:
The two companies that will receive the money from the president’s $862 billion economic stimulus are Abengoa Solar, which will build one of the world’s largest solar plants in Arizona, creating 1,600 construction jobs; and Abound Solar Manufacturing, which is building plants in Colorado and Indiana. The Obama administration says those projects will create more than 2,000 construction jobs and 1,500 permanent jobs.
So out of that $2 billion, only 1500 permanent jobs are being created.
Maybe. Maybe not so permanent.
The problem is, before the industry enjoys the fruits of that growth, it’s going to have to suffer.
Sullivan sees a period of significant over-capacity ahead, and expects to see :”violent changes” in the industry, with “widespread company failures throughout the value chain.” He contends that the “continuing glut threatens low-quality and high-cost players alike,” and particularly singles out Evergreen Solar (ESLR) and the Uni-Solar brand from Energy Conversion Devices (ENER) as companies at risk, due to “high operating costs and insufficient scale.”
They may well be right:
Fremont solar company’s IPO cancellation seen by some as red flag for industry
The withdrawal of Solyndra Inc.’s initial public offering might be due to the Fremont company’s pool of red ink and shaky financial markets — but the IPO cancellation nevertheless darkens the outlook for solar energy, some analysts said Monday.
The maker of solar cylinders — whose fortunes sparkled with high-profile visits to its Fremont operations from President Barack Obama and Gov. Arnold Schwarzenegger — was tarnished at the end of last week by its decision to scuttle a first-time sale of its stock to the public.
Hmm.
A stream of financial losses at Solyndra is among the visible woes for the manufacturer of cylindrical tubes that collect the sun’s rays.
During 2009, Solyndra lost $172.5 million, significantly smaller than its 2008 loss of $242.5 million.
“Solyndra’s problems didn’t cause the solar industry to have a problem, Solyndra is an example of the issues that face the solar industry,” said Aaron Chew, an analyst with Hapoalim Securities USA.
Falling prices are a huge challenge for the solar sector. Manufacturers have become more adroit at making solar systems more cheaply.
Sounds like a perfect time for government to invest.
Then there’s the little talked about problem of retired solar panel toxicity:
E-waste looms behind solar-power boom
“The electronics industry’s lack of environmental planning and oversight resulted in widespread toxic chemical pollution that caused death and injury to workers and people living in nearby communities. The high-tech industry’s legacy now includes the growing global tide of toxic electronic waste, or e-waste,” the report says.
A report from China by The Washington Post brought attention to this solar-waste issue to many people for the first time. A reporter visited a village where toxic silicon tetrachloride, a byproduct of silicon cell manufacturing, was dumped, making the land unsuitable for growing and posing a health risk to residents.
And cadmium and selenium.
The SVTC report outlines materials being used – and the processes involved – in making solar panels and the health problems they could cause. Some of these materials, such as cadmium and selenium, can cause serious health problems if humans are exposed to them in certain concentrations or over a prolonged period of time. Some of the materials haven’t gone though enough tests to show their safety levels, the SVTC said.
Are we trading one set of ecological troubles for another? It’s going to be far cheaper to dispose of these panels in landfills than recycle them. (Note to John Grisham: another book is awaiting your hand)
The manufacturing of solar panels is becoming less and less costly. But if there is money in it there will be international competition for that money. How long will it be before we buy virtually all solar panels from China? How long before Walmart starts to carry them? Then what of these companies? How long before they turn into GM and Chrysler?
DrJohn has been a health care professional for more than 30 years. In addition to clinical practice he has done extensive research and has published widely with over 70 original articles and abstracts in the peer-reviewed literature. DrJohn is well known in his field and has lectured on every continent except for Antarctica. He has been married to the same wonderful lady for over 30 years and has three kids- two sons, both of whom are attorneys and one daughter on her way into the field of education.
DrJohn was brought up with the concept that one can do well if one is prepared to work hard but nothing in life is guaranteed.
Except for liberals being foolish.
Nice idea, however, it won’t work. As the sales in the auto-industry, and the breakdowns of certain types of cars/trucks in particular, have shown is that people will buy what they want and drive what they want, regardless of governmental incentives to push certain vehicular types. The same thing happens with the energy industry. Solar power, as of this moment, is a fringe energy industry that has not shown the ability to grow beyond what crumbs are handed to them from the government. In time, this may change, especially if and when it becomes a cheaper alternative with a cost/production ratio that earns money for the developers regardless of government involvement.
Until that time comes, when solar is a viable private industry not dependent on subsidies from the government, it will never be embraced by the heavy-hitter investors.
It amuses me that no one is really talking about the true problem with solar power… ie… that just like Wind power it is both unreliable, and dependent on Geography.
Sun does not shine at night… and the amount of energy needed to “burn” snow and ice off of panels, would be more than you gain…
Solar is also MUCH less efficient as you go up lines of latitude… as the angle to ths sun changes AND solar energy has to go through more atmosphere (due to the angle).
So, Southern Deserts? Hey, may work, which is why there is commercial investment in trying to make large solar plants there…
But I sure would not want to rely on Solar power for electricity here in Denver, in the Winter….
@Romeo
You are correct, of course, in discussing the limitations and failings of solar power from an applicability standpoint. In reality, it is nothing more than a fringe part of the energy industry as a whole, and a fantasy of left-wing environmental zealots that it will become the dominant form of energy in the future. The use of legal theft by the feds to prop up the industry is proof that it is not viable from a cost perspective at this time.
The country would be much better off investing(privately, of course) in nuclear power, and clearing the red-tape currently in place for the building of new plants. The environmentalists, as is typical, have hindered and halted the advance of an energy source that would satisfy their consciences from an AGW standpoint and solve current inadequacies in the range and amount of power available. That they did this prior to the current ‘sky is falling’ meme of global warming caused by man is irrelevant. They still continue to place whatever hindrances necessary to prevent new plants from being built, and as such, have proven that they aren’t interested in solving what they perceive as a problem, and regardless of Obama’s empty words to the contrary, I doubt we will see the commissioning of a new nuclear plant anytime in the future.
@johngalt 3
Yeah… itsn’t it amazing that the only American group able to manufacture and complete nuclear power plants today… is the US Navy? A group with (hmmm Nautilus was in 55?) 55 YEARS of institutional knowledge about how to run these things safely?
@Romeo
As a former US Navy nuclear operator(89′ to 99′), I know precisely what you are talking about. The fact that the Navy has had those years of experience operating nuclear plants safely, and the fact that most of them go or try to go into the civilian nuclear sector upon their departure from service, allows me to have great faith in the human component when discussing nuclear power. Although I currently do not work in the nuclear field, I do work at an energy producing plant, so I know that nuclear power, after the initial cost of the plant itself(high in large part due to legal issue dealt with in regard to the environmentalists challenges), the cost of running a nuclear plant is by and far the cheapest form of energy produced today. Solar power, contrary to the belief of environmentalists, has a high cost due in large part to constant upkeep and the inability to produce power 24/7 whether it is due to weather or the daily rotation of the earth itself.
FYI the private sector is investing in solar.
More wind, but also solar.
@johngalt
Small World… I’m a proud reject from Navy Nuc Power School, Orlando… class 8006… was having too much fun to buckle down and study… probably turned out for the best as I like fixing Electronics anyway… LOL…
“Dr John” the 2 billion dollars was not actually handed out to the companies. The 2 billion dollars was guaranteed by the US Government and the actual money comes from private sources. I am not surprised that you failed to mention it, nor am I surprised the none of the other posters failed to mention it.http://www.businessweek.com/news/2010-07-03/obama-announces-loan-guarantees-for-solar-firms-abengoa-abound.html
The country that has the most solar capacity is Germany they are up to about 12 MW The Germans are not so well known for making silly investments.
As for the “toxicity” of solar thanks for posting that link showing the ease with which soar cells can be recycled.
The DOE also has guaranteed loans of about 8 billion for new nuke plants, without these guarantees they could not have obtained any financing.
@John ryan
Basic economics. When you Guarentee a loan, to a company that is NOT making a profit? You may as well be giving that loan.
Its like giving a loan to someone who can’t afford the Mortgage… and then making the government liable for it (Fannie and Freddie?)…. eventualy when that loan defaults, the Gov will pay.
As to the 8 billion for Nuc Plants? The reason they had to guarentee that money in the first place is because the EPA, can at whim, shut those projects down… and no Investor would touch those loans UNTIL the Government had skin in the game…
German solar proves mostly that determined environmentalists with enough money and engineering skill can use solar as a power source. If you think that the fact that the Germans did it proves that it makes great economic sense, I think you should look more closely at the details; http://www.technologyreview.com/energy/25577/ provides a balanced look, in my opinion (note the massive subsidies described in the opening paragraphs).
Personally I’m more partial to the French and their nuclear power. I actually like the idea of solar (power coming down from the sky for free, what’s to to like?), but when I run the numbers for my location (Pittsburgh) it turns out not to make sense. We have truly lousy insolation, though, lots of haze and clouds. Even many places further north (e.g. Bismarck) are more suitable because they have more clear days.
plainjane’s comment moved here
@Mr. Cross
There may be some willing to invest their money in solar power, but by and large, solar companies are a no-go for the major investing firms in the energy industry. The reason is that no profit is to be made from it yet based largely on reasons myself and Romeo have pointed out, such as lack of 24/7 production capability and amount of clear sky available year round based on weather patterns. The government guarantees for the loans are basically the government throwing money into the pool, as that money will end up being doled out for failed companies. Much as Romeo stated to Mr. Ryan about the nuclear guarantees for loans from the government, there aren’t enough willing participants to invest their private money, or the big investors to add solar to their portfolios without some kind of guarantee they won’t lose all of it, hence the government mitigating some of the risk associated with the investments into solar.
@Mr. Ryan
Do you realize how small 12 MW is when talking energy production for an entire country? That isn’t even a drop in the bucket. More like a grain of sand on a mile long stretch of beach. Heck, the plant I work at has an energy consumption more than three times that amount that gets taken off the top of total power we produce. Also, in comparison, 12 MW is about what is produced with only 12, count em’, 12 wind turbines, and most windfarms in the US carry well over a hundred or more.
In other words, using Germany’s solar production as an example to bolster any argument for increased solar power production is just silly.
@john ryan
The government also guaranteed sub-prime mortgages.
I didn’t feel like pointing it out earlier since it’s just a typo, but it’s more likely that the German installed base is 12 GW, not MW. They rolled out 3800 MW of solar power in 2009 alone and have three or four plants that are 40MW or higher capacity. It’s still a small portion of their overall capacity (see http://www.geni.org/globalenergy/library/energy-issues/germany/index.shtml) and the nature of the power availability means there is an upper limit to how much they can convert to solar, but it’s not as negligible as the erroneous 12MW figure would suggest.
@plainjane31: there is already a thread on the Taiwan tanker going. You may wish to move your comment there instead. Also, if you read my post, you will learn that the A-Whale only arrived in LA on June 30th, and was still battling Hurricane Alex seas in addition to EPA/USCG BS, which delayed the beginning of the testing.
Apologize for OT continuation.
Was reading about Abengoa Solar a few days ago when I saw some news on the DOE awards. This will be the sixth contract (including this award) for this company with the DOE. Abengoa’s share of the $2 bil loan committment is $1.45 bil… the lion’s share. Altho they are a Spanish company, they also have US solar headquarters in Colorado and California. (I believe a presence of 70 some nations total… no mini mogul they are)
What I found most interesting about it was they were working on a new, supposedly more efficient, storage of unused power. Whatever headway we can make in capacitance is definitely good news.
The argument Dr. John makes in his reader post (good one, BTW, Dr.J) is viable on a couple of fronts. It is a vast amount of taxpayer stimulus funds being used to advance not only so few permanent jobs (i.e. price per postiion), but also to provide power to a very small segment of the nation. It’s another FDR/TVA piss poor government power play which, between it’s tax burden on the nation as well as it’s price setting, still have left the surrounding territorial localities and their economic conditions behind the rest of the nation.
But then, history is not this POTUS’s forte.
BTW, as an added tidbit, according to the Corporate info snapshot on this company, they’ve been doing quite well since Obama decided to squat in the WH. Don’t know if the sidebars that say both Gate and Buffett are heavily invested in this stock, but it sure wouldn’t surprise me. Altho $1.9 bil for Buffett is chump change, and it certainly isn’t one of his six long term winner picks.
Another view here on Daily Finance.< ?a>
johngalt: hi, what do you think of getting the sun energy from a sattelite which is above the clouds and could be permenantly situated on a axle where the sun move to bring powers down on earth having reflectives panels: IF it’s not done yet, well it could
be created. bye 🙄
Bees, my son and I have this discussion off and on. Consider a satellite energy source a serious national security problem. How would you like the nation’s energy source destroyed by a single enemy’s missile? Actually the smaller more local grids we have, the less vunerable we are to a national energy crisis by grids being destroyed… or even subject to rolling brown or black outs.
@MataHarley:
Sorry Mata, I didn’t see your post until after my deletion time had expired. If you can, will you please delete it for me.
no problem, plainjane31. How about I just “move” it over to that thread so others can also check out the gatewaypundit link too?
I think we are getting a feel for how much the dollar will be worth in the future.
$1 million per job,
$20/gallon gasoline
$30 strawberries for the elite
soylent green for the rest
And if you want electricity and don’t work for the government, peddle faster.
RSWEENEY: you got it right , and you make it look funny too. 🙄
MATA yes ,you brought a very good negative side, and also the wind towers make a lot of noise 🙄
@Mata Harley 20
Actualy, the bigger threat is that when you have the ability to focus that amount of energy into a small area, its easy to redirect onto the enemys infrastructure…
It would be way too easy to weaponize this type of space based installation…
Romeo13… you mean like Jame’s Bond’s Diamonds are Forever? LOL
@ Dr. John,
For more on job destruction by the current geniuses in the White House, you’ll be both humoured and saddened by this article: Barack Obama: The Great Jobs Killer
I didn’t really want to take readers off the path here, but unfortunately, the article mirrors the very serious plight of small businesses across America, . . . the Obama machine rolls on unabated.
ROMEO13: yes, you could include a mirror that move constantly,searching for coming missiles than
that mirror stop on it ,reflecting sunrayes that would pulveryse the missile before it attack, that would need a lot of precision, but doable. bye 🙄
MATA great idea, we could install some diamond parts on the previous sattelite on the moving search mirror attacker of missile
that would increase the power of the sunrays by multiplying them with the multi facets of the diamonds. :roll
@Mata Harley 26
Actualy? Yes… do the math, check the physics. If you can focus enough energy from space to heat a small area to the point of generating enough heat to run a turbine? Then add in the idea of focusing 3 or 4 of em on the same target? (not talking moving targets, but staionary targets)…
People tend to forget that MOST scientific advances of the last 75+ years have been predicted by Science Fiction… whether its Satelites, Exo Skeletons, Rail Guns… or even the cell and video phones (Dick Tracy anyone?)…. and not to mention Jules Verne and Nuc Subs? or… the Martian “Heat Rays” that we are now putting on the noses of 747s to shoot down Ballistic Missles?
The repurcusions of science are getting scarier and scarier… and with the laws of unintended consequence… we sometimes do shoot ourselves in the foot.
Yes, Romeo13… plenty of decades of movies under this old belt, watching reality sometimes hit too close. Never thought it couldn’t be done technically. However the Outer Space Treaty, of which this nation is a signatory and has been ratified by Congress, isn’t likely to allow for dual purpose lasers/weapons in space disguised as an energy beam. They are still working on expanding space laws to prohibit outright conventional weaponry (as opposed to the Treaty’s nukes or WMDs). And it really is a dumb move to even think of putting all US energy into one space basket for easy destruction.
Now, of course, the Clint Eastwood/Tommy Lee Jones movie, Space Cowboys, comes to mind…. heh
@James Raider
Read it, thanks! It’s on the money.
@bbartlog
I wasn’t necessarily addressing the actual capacity of Germany’s solar energy program, although I probably should have delved deeper into it. One of the major problems of solar power, when considering the addition of it to any energy portfolio, is the fact that it cannot be used in it’s current makeup as any part of current ‘base load’. Base load is that amount that is always in demand although it differs season to season(for example, base load in fall and spring is much lower than in winter and summer based on the use of heating and cooling for homes and businesses), it is a nearly constant amount. The intermediate and peak load plants make up for the demand increases seen as people wake in the morning and get home from work in the evening and the demand changes based on day of the week, holiday times and other events and situations that are not continuous in nature.
Even considering storage capabilities being researched, solar power, and to a lesser extent wind power, are more suited for the peak power times and in some areas the intermediate demands. Traditional power sources such as coal, gas and nuclear will always be needed for the base load unless and until such advances happen in the solar field to allow them to provide the nearly constant power production required of base load plants.
In essence, while there is a place for solar power addition to any power grid, it is, and will remain for some time, a peak load addition to the grid.
JOHNGALT: hi, you know, I was thinking[I do that sometimes] we cannot be free from others sources, because the winter for some areas demand a lot, and thoses big mansions eat a lot more
and thoses swimming pools need power and what would happen to the electric car that OBAMA want to push, consider a minimum of some thousand car,how much would they eat,ecetera, that does’nt come to mind, computers powertool… bye, you can get more electricity from QUEBEC who have extra to sell, they started the new project by flattenning “LA ROMAINE” up north, an untouch wilderness nature treasure, that will augment the power for their future customers in USA. by 🙄
JOHNGALT: i had a google ad about’ ROBINSON SOLAR WATER PUMP SYSTEM and kits,I click on
I was not familiar with it, it’s in OKLAHOMA. bye
ROMEO13: hi, YOU say, the law of unintended consequence?, LiKE SHOOTING A missile WITH A search DEVICE, AND the missil not finding anything, turn back to shoot you. bye hope
that you lauph. 🙄
@ILOVEBEESWARZONE
One of the corrolarys of Murphys Law… Military division…
“Freindly Fire, isn’t”
ROMEO 13: I dont understand what it means, “corrolarys of MURPHYS”, who’s that guy?
I never heard of him. bye 🙄
@ilovebeeswarzone:
Here you go:
http://roso.epfl.ch/dm/murphy.html
MISSY: nice to have you back,thank you for the link, it is hilarious I hope my download took
it all. bye 🙄
ENERGY FROM SATELLITES
If they are going to use satellites for energy it will probably be the type that converts sunlight into microwave or laser energy and direct the beam down to a receiver and send it out from there. Any way they use satellites will be too expensive to set up and maintain. How long does it take your cable guy to come and fix your reception problem?
NUCLEAR POWER PLANTS
Do you want the waste near your house? They still don’t have a place to put it and don’t know how many thousands or millions of years it will take for it to deteriorate. In that length of time the deserts could become lakes, the lakes could become deserts, and earthquakes or eruptions could expose the waste.
CONSERVING ENERGY
Over the years I have heard or read about different engineers building their houses so they use little or no outside energy. Some of them even sell electricity to the power company if that state requires the power company to take it. One engineer built his house in the desert with about one foot thick concrete walls. The desert night cools the concrete so that during the day it radiates in and the concrete starts to warm up. At night the heat radiates in and warms the house. He uses very little energy to keep his house cool or warm. All we need is a Federal mandate that buildings will use only a certain amount of energy and it will be met. It will cost a lot more to build them, but the savings on energy will make it easier to make the payments each month. Take your energy bill and subtract at least 75% from it and that is how much extra you could pay on your monthly house payment.
DIAMONDS IN THE MISSILES
The way we are going we will have to hire other countries to launch our missiles. Do you think the diamonds will be in them when they are launched?
EDUCATING OUR KIDS
When I read or hear about the different kinds of amazing technology we are doing now I can’t help but think of all the high school kids graduating from school who can’t fill out a job application because they don’t understand the questions or can’t read them.
Hey it’s funny that Spain does not provide the guaranteed loan for Abengoa Solar? Spain is a leader in solar energy right! The whole country is solar powered, right? This should be a good investment for Spain to pay for the current debt.