Cynthia Shahan of Clean Technica reports Residential Solar Cheaper Than Grid Electricity In 25 States By 2015, Utility CEO States. The cost of solar panels has come down 75% in the last four years. Although a trade war with China and India over low cost solar panels will be a "bump in the road," this basic trend is going to continue as the learning curve for the global solar photovoltaic industry is now well established at a 20% reduction of unit manufacturing cost for every doubling of the installed base.
David Crane, CEO of utility NRG sees major disruptive impact for the traditional U.S. utilities industries, and he has decided to "switch rather than fight."
David Crane, who runs NRG Energy, says that in fully half the states of the union, electricity from residential solar panels will be cost-competitive with that delivered by local electric utilities by next year.
Another important matter is that electric vehicles will enable a more decentralized, self-sufficient energy system. John writes: “Once homes can not only generate but store energy, it’s at least possible they could decouple from the grid entirely–meaning they’re lost to their local utility forever.”
“Crane is positioning NRG to be the supplier of solar arrays, fuel cells, and microturbines to power customers in this age of grid obsolescence,” Navigant Research writes. “It’s remarkable to see a utility betting on the grid’s eventual obsolescence, but it’s important to note that within that framework, NRG is still maintaining its core business as a power provider.”
Crane certainly seems to be the exception among utility leaders Many have joined efforts with ALEC to rollback or delay state Renewable Portfolio Standards, RPS, to add fees, or minimum bills to those solar customers who use net metering, and also to reduce the price payed to external solar producers.
China has taken a more positive and wiser strategy using this knowledge to buy its way down the solar industry learning curve. Rather than ask, "how long will it be before solar energy generation can match, or beat the cost of coal generation?" They asked, "how much would it cost to make solar energy less expensive than coal? [Update: China is currently either one of the worst, or I think possibly the worst coal polluter in the world and as becoming even more so by building more new coal plants even now than any other country. And China has an enormous self-induced pollution problem. (Thanks to duhban for reminding me of this. My point here is not to glorify China but send a wake-up call to us in the U.S. by taking a poke at our automatic assumptions of superiority and exceptionalism without regard to facts.)']
Reports are when Chinese leaders heard how small this cost was compared to the damage in health cost coal is causing them, and the size of their economy, they laughed and said "make it so."
This is the explanation behind the mysterious series of $10 to $30 billion per year of Chinese government sponsored solar projects over the recent years. Some short-sighted critics here scoffed, however, the Chinese were investing in their future - priming the pump. Now they may reap the returns on that clever investment for centuries.
Hundreds of years from now stories of this victory my be read in history books like we read about great battles from the past like WWII. Maybe this brilliant investment will be retold in Chinese history books as one of the key factors enabling China to pull ahead in the economic wars and leave us in the dust. Maybe they will have a special day of celebration like we have Pearl Harbor day?
The latest report I've read, which I am writing up in between moving, is that in China, solar energy will achieve grid parity in 2016 or at latest 2017 - a full four to five years sooner than they expected because of their brilliant use of learning curve strategy.
Yes, the U.S has enacted trade barrier tariffs against them because of what we call
"unfair subsidies" of their industry, however, the Chinese seem to feel confident they made the wiser strategic decision for four reasons.
1. From 2016 on-wards there will be no economic reason to build any more coal plants, and shortly thereafter they can start phasing out existing plants at a profit.
2. China can gain geopolitical prestige and soft-power by leading the rest of the world into the future and then chastising the U.S. for our backward coal burning ways. In a move that will be poignant and even galling to many of us here, China may even eventually propose global trade sanctions against backward countries like the U.S. who selfishly insist on burning coal and fossil fuels, thereby jeopardizing the earth's atmosphere with global warming, like an anti-social drug addict, or sociopath who cares not about how how actions impact others around the world.
An, argument many of of us have been using to fend off climate change deniers who skeptically ask, "what if we make our industries convert away from coal, but the Chinese do not" - I'm one of many who have suggested the rest of the world is so eager to avoid global environmental and economic disaster that punishing sanctions will be imposed on any laggards who refuse to curtail the burning of fossil fuels. So we should push ahead, regardless of what the Chinese do. What a sad irony that our own arrogance may be turned around against us, in a surprising move of jui-jitsu.
3. China's cost savings from the learning curve will be able to exceed the extra cost of U.S. solar panel trade tariffs the next time the installed base doubles, then achieve profits with the strategy after that.
4. China then emerges as the dominant global player in solar energy technologies invented, and cultivated down the first 50 years of the learning curve by the U.S. when the new technologies were outrageously expensive. But sadly, our backwards political leaders slept, or solve themselves, and our country, out to coal industry lobbyists, and ALEC, for a few pieces of silver.
For a sound track for this post just select the play triangle while you continue to read.
What an inspiring display of superior strategic thinking, and action. Germany now seems to be in the process of using the same industrial strategy with solar batteries. This has been one of my areas of professional consulting, and if the Chinese succeed in this strategy I will have to say it will be on the most brilliant examples of successful application of learning curve strategy since the Japanese returned from a bombed out wasteland after WWII to capture our consumer electronics and auto industries.
In both cases, too many in the U.S. have their heads up their .... in the clouds talking about free markets, and spouting anti-government tripe opposing any national U.S. economic development strategies and industrial policies that nearly every other nation of the world eagerly seizes upon.
Germany is now positioning itself to dominate the solar storage (battery) industry.
While it is sad to see America stumbling like a drunk at a track meet, it is encouraging in a way to know the rest of the human race is picking up the torch of leadership, to move ahead with or without us.
Our traitorous right-wing science deniers, and ALEC organized coal lobbyist may be powerful enough to sadly bring down our great nation, but they will not be powerful enough to bring down humankind. When one country fails in its capability and willingness to lead, they fall, and another country picks up the torch.
We've seen it dozens of times throughout history. We might have go face the chilling truth that with so many right-wing ideologues, and their backers from ALEC willing to subvert the best interests of our country, the extra burden of this albatross around our necks, we may not be able to compete or keep up with other nations who are united in their efforts to succeed, thrive, and revitalize their economies and jobs base.
Of course, theoretically, it is no too late for the U.S. to decide to jump back into the game, however, we would have to find a way to convert, or "offload" the anti-government Republicans and Tea Party extremists into realizing that one of the roles all most all other nations assign to their government is to use the most strategic, and advantageous economic and industrial policies to cultivate and maintain their nations' economic superiority and competitiveness.
I've proposed many times over the last years that we organize ourselves to make a play for the most intelligent of the foreign policy and pro-defense, Republicans as well as the most patriotic and educated of the pro-economic growth Republicans, with almost zero support in response.
My hope is that at some point the number of high paying, high-value added jobs, industries, and technologies we have lost to other countries who are successively working explicit, public non-secret, plans to take these from us, will be enough to wake up a sufficient number of people to the fact that we need to wake up, smell the coffee, or pull our heads out of .... the clouds, or whatever metaphor works for folks and get back into the game of making our economy a thriving prosperous, world class economic power once again.
And when we invent amazing new, industry creating technologies we ought to make serious, strategic, smart, effective national economic and industrial policies for using them to create jobs and economic prosperity in our country, and not give them away while our political leaders line their pockets with silver from ALEC and the coal industry.
It's why I founded Keynesian Kossacks to get this message out along with the need to support and expand President Obama's infrastructure expansion projects, (which include upgrading electric transmissions lines making solar and wind more cost competitive in broader regions, and improves intermittency issues with wider areas load averaging.
All these this work together in an excellent, powerful, what should be an easy to implement plan.
If we put it together and articulate such a plan, much better than we have so far, we should be able to convert enough pro-economic growth, and pro-national defense Republicans to pass it even in a GOP dominated house.
I admit Keynesian Kossacks may have been a poor choice for a name, and we never really articulated our strategy, so I guess I have to take personal responsibility for our nation's puttering economic, however, let's not give up yet. If anyone else wants to take the reigns, I will stand aside.
What's a better name? What's is the better communication strategy? Who are the more vigorous leaders who can move this agenda forward?
What's a better way to communicate this message of the enormous potential for economic growth and good, solid, green jobs in developing a national economic development and industrial policy based on accelerating our conversion to renewable energy sources, and modernizing our nations infrastructure the way China, and nearly all other advanced industrial economies are doing?
Let's focus some creativity, passion, and intelligence here folks, and keep some of America's leading new technologies, industries, and jobs in America. A strong thriving economy benefits us all. The need to convert to cleaner, non-fossil-fuel burning energy sources is overwhelmingly clear.
We know what the new technologies are going to be, because we invented them. We still have smart, bold, entrepreneurs like Elon Musk (Chairmen of one of America's top solar companies, SolarCity, he is also CEO of Telsa Motors and SpaceX.) and enough of an industrial base we should be able to stay in this game, despite the fact that we fell asleep at the wheel and let the Chinese take the lead. We still have American entrepreneurs and workers who know how to make things and want to make things.
But, right now right-wing ideologues are shooting themselves in the foot, (and the rest of us too) by joining with ALEC to fight solar energy, and roll back state Renewable Energy Portfolios, RPSs. A few weeks ago Governor John Kasich (R-OH) signed an ALEC backed law delaying Ohio's RPS plans for two years and getting rid of some of the incentives for solar. Now they are shooting up their legs. Let's intervene and get them to stop before they start shooting off some really important parts.
If we were thinking like the Republicans we would be demanding that John Kasich be arrested and shot for treason. Here we are in a global economic war with the largest, most powerful bunch of real communists in the world, who is eating our lunch, - drinking our milkshake, and this treacherous traitor John Kasich, aids and abets the enemy by trying to chop off America's patriotic Ohio solar and wind power entrepreneurs who are fighting a battle to keep America strong and competitive while China tries to steal our core American advanced technologies?
Like I said, it is a good thing we do not think like Republicans and despise their jingoistic claptrap or we might say things like:
This is a friggin' outrage. Where is Darryl Issa when we need him? We need a full investigation of John Kasich, ALEC, and any politicians associated with this anti-American operation to see if they have any connections to these communists trying to steal or solar and wind industries, technologies, and jobs.Let's wake up and show the world, we Americans can still do world class engineering and industrial projects better than we can play soccer.
Is that how low we have to go to peel off 10% of the GOP to join us in being strong? Because if that is the answer, I know how to play that game. How do we expect to keep up with Chinese defense spending if their economy surpasses ours, and it is only a matter of time at 7% - 10% per year compound growth rates. - a clear and present danger.
Perhaps, they best place to start this investigation is to print out the names of all the corporations supporting ALEC, and investigate any and all of their commercial, and any other connections to China? What other reason could there be to explain why ALEC is fighting to undermine solar and wind power at every level? John Kasich is only one example of the many state level attempts to undermine the Renewable Portfolio Standards that is one of our front lines of defense. R
Investments in renewable energy promote of our emerging American solar and wind industries, (make note to Ohio press - check Kashich and ALEC for Chinese campaign contributors for possible explanations for his un-American activities.) (Snark alert based on illustrative rhetorical excess illustrating what may happen if progressive forces imitate right-wing McCarthyesque styles of attack).
Happy Forth of July holiday kogs.
Perhaps, there is no better day to start investigating ALEC and associated politicians for what appears to be a seriously destructive and an anti-American agenda harming our solar, wind, and other renewable alternative energy technologies right at this critical moment, when we are in a fierce economic war to keep as many of those industries, jobs, companies, technologies, and related economic growth in the U.S..
We need to expose the self-serving, and destructive agenda of the ALEC companies who seem determine to undermine American prosperity and take the appropriate actions to let them know Americans will not shop at or support in anyway, any companies trying to undermine American's economic health, prosperity, jobs, military strength and national security.
Any companies on this ALEC list should also be banned from benefiting from tax loopholes, benefits, or other exemptions intended to help the companies that are helping to build America, not harm it, or exploit it for greed at the expense of our common good.
Please join me contacting your congresspeople, and also Senate Majority Leader Harry Reid, and Speaker of the House John Boehner to demand a bipartisan joint congressional investigation of any possible ant-American actions or connection of this organization called ALEC.
Also, let's support a bipartisan national economic and industrial policy to keep America strong and prosperous by supporting the most rapid expansion possible of American solar, wind, tidal, and geothermal energy and all of the urgent infrastructure repair and upgrading of our roads, bridges, electrical transmission networks needed to support them and getting our economy running at full steam again.
Let's not sit back and sleep while China pulls ahead with 7% to 10% annual compounded growth rates, while we do nothing, or worse kneecap our critical solar, wind, energy storage and other new American industries vital for our future prosperity.
God bless America and all the countries and peoples of the World. (cue music)
Happy Forth of July!
Woof! woof! Aaaaaahhhhhhwwwwwwwwooooooooooooo!
6:44 PM PT: Duhban raises the valid points that China is now the worst coal polluter on the planet, and I would add getting worse, not better at the moment. I was not trying to whitewash this fact or glorify China as much as shame Americans into waking up and doing something.
By using there tired and jingoistic pro-military argument against them.
China right now is in the midst of an enormous self-created coal based pollution crisis as any of my regular readers know because I've reported it many times here even recently. As soon as i get back from dinner I'll add some links on this.
Another clarification is that I have not changed my opinion that we have vastly too much military spending, and I would be happy to cut it by 50% or more and still feel we would be perfectly safe from a "Soviet" (sic) invasion, since they don't even exist anymore.
I was illustrating how easily we could achieve common ground with pro-military spending Republicans by arguing that investments now in renewable energy that also stimulates our economy means a higher economic growth rate.
One does not need to be a mathematician to realize it does not take many decades of 7% to 10% compounded annual growth of both GDP, and GNP compared to our anemic 2% to 3% before China passes us by and after a few decades can spend more than we can even with the lower fraction of their GDP they currently spend on military.
Key points if you are an intelligent well educated Republican who favors a strong economy and strong defense forging an alliance with the no-nothing Luddite science deniers in the social conservatives is hazardous to our national security and long-term corporate profitability.