Our normal “brown” energy is sold by the kWh (kilowatt- hour) for around 10 cents here in the areas that TVA (our friendly local energy monopoly) serves.  The “average” house uses around 1000 kwh’s per month for a monthly bill of $100.

Traditionally we Americans have gotten used to paying each month for the power that we use. Our electric bill unfortunately seems to keep going up. Our local energy monopoly has had 3 price increases in the past year! The latest increase was blamed on a “mild winter” with customers using less energy than previously expected— so, TVA decided to raise the rates. We are not even talking about the extra money that TVA has put on all of our electrical bills ($.69 per bill) for the next 13 years to pay for the Kingston fly ash spill clean up costs.

Basically we are forced to pay whatever the energy monopoly prints on the bill and sends our way. We can try to reduce our usage to minimize our expense, but we are stuck with the bill!

I am not sure if the protected energy monopolies have our best interest in mind. They quickly raise OUR rates when THEY make mistakes (in estimating seasonal usage or by inadvertently dumping fly ash into our rivers).

What will happen when the cost of raw coal increases?…. Easy- The monopolies will raise our rates.

What will happen when the cost of transporting coal increases (because of sky high fuel costs)?…. Easy- they will raise our rates.

What will happen when coal costs more to mine because they can no longer endanger miners lives by ignoring safety regulations? Easy…. they will raise our rates.

What will happen when the utilities must clean up their emissions? Easy…. they will raise our rates.

What will happen when their proposed nuclear reactors cost more to build than they  initially claimed? Easy…. they will raise our rates!

What will happen when nuclear fuel becomes scarce or highly regulated? Easy…. they will raise our rates!

And what can we do about it? Keep quite and pay your bill!

 The energy monopolies can basically charge us whatever they want (in collusion with their “regulators”- the ones who grant their “monopoly” status). The only folks who are left out of the discussion are us lowly “ratepayers.”

These rates have been escalating at around 5% per year. We can conservatively estimate that rates will continue to escalate at the same rate. TVA itself assumes prices will escalate on this trajectory. So, get ready for some higher electrical prices.

The monopolies are protected landlords… they basically rent you their electrical power production. If you owned your own power production you wouldn’t need to rent any power production from them. For instance, if you owned your own solar system and generated enough electricity to run your whole house you could feasibly unplug from the “grid” and be your own power source. You would be an “energy system owner.” That is comparable to a “home owner.”

The same questions are legitimate for home ownership as are for energy system ownership. Is owning better than renting? Which is less expensive? Which makes more sense?

It depends….. home ownership was seen as an American right for so long and people assumed that home prices were always going to escalate. Home ownership seemed like the ONLY wise choice for many years.

With the bursting of the housing bubble many folks have re-visited the “ownership” question and many have decided that renting can also be a wise move (at times). It depends on so many factors…..  some of these include…

• how long you are planning on staying in the house?,
• what kind of a downpayment can you afford?,
• what is happening with the neighborhood?,
• what is happening with your employment?,
• what do resale values in the area look like?,

and many other factors.

With energy production it is a little different. The prices will definitely continue to rise. Nobody at the power monopoly will bat an eye when you estimate that prices will increase at 5% per year. They know it will happen, as it has been happening like that for years!

Producing some of your own power can be a tremendous investment. A solar system that produces electricity each month will automatically be getting at least 5% MORE valuable each and every year (as the cost of electricity rises). This is like locking in a house that you know will increase in value each and every year. Guaranteed appreciation. This is one of the reasons that energy “ownership” can be much better than simply “renting.”

On top of the guaranteed appreciation that energy production ownership affords, you can also know that you will never have ANY fuel costs. ALL of the fuel costs for the next 25 years (warrantied lifespan) of the solar system have already been paid up front. No matter what happens to the cost of coal, gas, propane, natural gas, etc. you have already protected yourself with an “energy hedge”. Your prices will not increase.

So you can lock in your price of electricity for the next 25 years. (Actually, the useful lifespan of these solar systems is more like 40 years). If you spread out the cost of the system per kWh produced over it’s whole lifespan you find that for 40 years you will have paid an average of under $.06 per kWh. Under $.06 per kWh for 40 years!

The current rate for electricity today is $.10 per kWh. So, assuming that the cost of electricity NEVER went up in the next 40 years, you would still be only paying 6/10ths as much for the solar generated electricity.

 At a 5% rate of increase- 25 years from now we will be paying over $.32 per kWh to our friendly local energy monopoly. The solar system will still be generating electricity for $.06 per kWh. You’ll be laughing all the way to bank. More likely your neighbors will be crying all the way to the “quick loan” store to cover their energy bills…  Notice that smile on her face as she gets ready to pay her electrical bill!

If prices increase faster than the estimated 5%…. that is only better for solar energy AND  for you.

You are guaranteed to save money in the long term owning your own solar energy production. The main issue that currently makes us hesitate is that we need to come up with such a large up front capital investment. We have to buy the power plant before we can realize the savings.

At SimpleEnergyWorks we are working with financiers who are interested in providing loans for these clean energy systems. (They realize what a stable and lucrative investment clean energy is!). They will loan up to $25k to those with a good credit history for a solar system. These loans are available for homeowners, even if you don’t have any equity in the house. In other words, when you install a $25k solar system on your house, the lender knows that your house is now worth $25k more than before- that is where your equity (and their security) comes from!

The loans for businesses to install a solar system are even better!

The up front cost of a solar system should no longer keep anyone  from “energy independence” and “energy production ownership.”   Energy Producers are the new Home Owners… it’s time to leave your landlord behind!

When we started out, about three years ago, there were only about five solar installers in the middle of our state, from Knoxville to Nashville. Now there are more than 25, and there is no reason to believe that new companies won’t continue to emerge, expand and prosper.

But the solar energy industry’s growth could be stalled on the state and national levels by a looming trade war with China. A German-owned company called SolarWorld, with a facility in Oregon, has filed a petition with the U.S. Department of Commerce requesting special tariffs of up to 250 percent on some solar panels imported from China.

You don’t need a solar-powered crystal ball to know what these huge tariffs would mean for the industry. China would retaliate against American-made solar products. Prices would rise on solar components of all kinds, whether manufactured in the U.S., China or other countries. Sales of solar energy systems would decline. Businesses would downsize. Workers would lose their jobs.

Why would new tariffs mean less growth? Because the solar industry relies on steadily falling prices. With the price of solar energy falling by about 30 percent over the past year, the U.S. solar industry added some 7,000 new jobs, for a total of more than 100,000 employees. That’s a growth rate of about 6.8 percent — almost 10 times as much as the meager 0.7 percent employment growth rate in the entire economy. Over the year ahead, the solar industry is expected to add another 24,000 jobs, for a growth rate of about 24 percent. But huge tariffs on solar panels — and higher prices for solar energy systems — could throw this growth into reverse gear.

At Simple Energy Works, most of the solar panels we use are made in Memphis. Their prices are not significantly different from those of modules made in China. Competition keeps American module-makers competitive, and that keeps costs down throughout our industry.

With lower prices, we can cut the cost of solar energy per watt of electrical power generated. This improves a solar energy system’s “payoff” — how long it takes before a system pays for itself by providing electrical power at a lower cost than electricity generated from fossil fuels. Right now, solar energy systems have a 12- to 13-year payoff in houses, which makes sense to many homeowners, and a five- to six-year payoff for commercial installations, which makes sense to many corporate chief financial officers. If prices go up, it will take longer for solar energy systems to pay for themselves. Homeowners’ and corporate executives’ eyes will glaze over when I try to sell them solar energy systems.

It isn’t just my business that’s at stake. It’s a fast-growing industry that’s good for the economy and the environment. Multiply the consequences for our company with the harmful impact on all 25 solar companies from Knoxville to Nashville — and almost 5,000 firms throughout the nation — and you get an idea of how a special tariff on solar panels from China could hurt the entire economy.

With the Tennessee Valley Authority offering a new program to encourage solar energy providers to hook into the power grid, the future for solar in our state should be promising. The tariff’s supporters may think they’re targeting Nanking, but they’re really taking aim at Knoxville.

You can read the editorial at the Knoxville News Sentinal.

Well, I am all for supporting American module makers, and we typically install “Sharp” modules (made in Memphis).    I cannot however agree nor support anyone pushing  to slap tarriff’s on our competitors simply because they are good at what they do:  competition!   Their very success is what brings on the complaint!   They are driving the prices down, which is EXACTLY what the solar industry needs.

Remember- this complaint is not about any “theft of ideas” or “corporate theft” or stealing patents.  It is simply about the low price of Chinese modules.  Any proof of these practices should certainly be investigated and punished.   But we most should certainly should NOT punish the Chinese for simply supplying modules cheaper than American manufacturers!

The very LAST thing we need is to start throwing tariff’s on Chinese goods.   The losers in this fiasco will be the American consumers.   And this “clean energy” market is the very  market that the American consumers need to see prices continue to drop.

Tariff’s are always a bad idea.   They only protect the “connected.”  Their unintended consequences are legion.   They cause retaliation and ill will and are certainly a use of “force” when none is necessary.    Trade wars cause casualties, and what we need is a mutually cooperative effort to drive down the cost of clean energy, not a multi-national fight.

Think about Iphones.   They are designed in America.   They are manufactured in Asia. 100% are built in Asia.  Should we therefore slap a 100% tariff on them because some  manufacturer located in “America”  is not producing them?  What about flat screen TV’s?  No- there is no “right” to produce something in a certain local.    If other countries have competitive advantages by all means lets benefit from those advantages.

The only people that this tariff will help will be SolarWorld (a German company with a branch in Oregon) and their co-consipiritors.    The rank and file Americans who need and want affordable solar energy will get the “shaft.”

We drafted and sent a letter to Obama.   You can read the letter by clicking on the link or the image of the letter to the right.

I don’t know if he even reads letters like this, but I know he received it.

Keep looking up!

That is normally effective and can give the general idea of what a solar system will look like installed on a building or house. It’s good for installation clarification, but not so good for “selling” the PV system.

When you want to really get the full experience there is no substitute for 3D modeling. SketchUp is the premier tool for doing those types of renderings and we have recently began offering 3D models to our clients.

Think about it. What “makes” you buy a car? It’s not a photograph of the car. It is not really “bought” until you are actually in the car and driving down the road. When you can see yourself as the driver, and when you can see other people looking at you in the car with “jealousy.” Maybe even taking down the convertible top and driving down “the strip” or along the “beach.”

The sale of the car occurs when you “envision” yourself with the product-  when it becomes yours.  It is visceral and earthy. No amount of talking can ever allow one to envision the end product.

 3D modeling is one way to get a feel for how the system will look on the property. It’s not the only way to bring the PV system to life, but it is a good way. We have found it very helpful as we provide proposals to use a SketchUp model so that the PV system jumps off the printed page.

Simple Energy Works is now offering SketchUp models for homeowners and business owners here in Tennessee so that they can see what the finished product will look like on their property. This SketchUp design work is included in our premium solar assessment ($50) and that whole fee is credited towards the purchase price of the system.

We are also offering this design service to other solar installers who would like to include a SketchUp render of the house/building for their own customers (or on which they are installing a system). We can do a basic render for $50, and the more complex renderings are simply charged by the hour (after that first hour).
 Not only can we do the 3D rendering, but the house can also be geo-located and a shading analysis can be done at the same time. This shading analysis can help see shading issues that may pop up over the course of a year. Using the exact location of the house and the exact orientation of the building can show shading issues from dormers, chimneys, etc. Now these shading issues should have already been caught with the shading analysis tools available (solar pathfinder, solmetric suneye, etc.), but some may require 3D modeling to figure out.

SketchUp can be used to figure out spacing between rows in ground mount arrays because it uses the actual sun position for that location.

We are solar professionals, and we do SketchUp. We know the language, the design and the processes of the solar industry. As a matter of fact, we have 3 NABCEP certified employees. Don’t spend all of your time trying to explain solar to some SketchUp designer (who may barely speak English) when we have the design and solar skills already in one package.

SketchUp is easy to tinker with, but takes a lot of training to become proficient at rendering quality models. We have the training and the experience to model your house or your next project. By all means, pick up SketchUp and begin the modeling process. If you can make it work- we totally recommend that you begin using these renderings in your proposals (or for site design).

If you need us to render a building or house we will be happy to help. Our designers can normally turn a model out in less than 24 hours.

Who doesn’t want to see their property in 3D?

This grant has been a long time in coming.

TVA for 10 years has been in a lawsuit with the EPA for not being in compliance with the Clean Air Act regulations. In other words, TVA has been polluting for years and the EPA had finally had enough. They filed suit for TVA to stop polluting and to pay fines for the damage they have done. In 2011 TVA settled and agreed to pay wads of cash to the state of Tennessee (and other states as well).

Well– some of that money ($26.4 million)was given directly to the state of Tennessee to do environmental mitigation projects. The state of Tennessee has decided to use a portion of the money to incentivize organizations in Tennessee to upgrade their efficiency and to use a cleaner energy mix. You can see the state of Tennessee grant page here.

The grant will be spread out over the next five years with a little over $5 million being awarded each year. The first round of grants will be closing on March 30, 2012. This grant will be re-opening each year in the early months and closing in the Spring.

We have some very successful grant strategies for this grant that you will want to be aware of! It is going to be competitive and the funds will probably go quickly.

The one thing that we know for sure is that if you do not apply for this grant- you will definitely not receive any funds! The only way to get these funds is to get in the game as soon as possible.

You have to be on the field to win.

We write these applications for our customers from start to finish. There is no extra fee for the grantwork! It is simply part of the installation of the solar system. Remember… the prices are dropping, and incentives are starting to be tapered off. As the price of the solar systems comes down– so do the incentives. They start to leave.

Now is the time to explore solar because the equipment prices have dropped, but the incentives are currently STILL available. He who hesitates is lost in this game. Don’t end up looking back saying “I should have applied for that grant back when it was available….”

This money is not blood money (taken from other taxpayers). This money is re-payment for the damaged air that you have been breathing for the past 25 years. Don’t turn it down.

A state grant like this never needs to be repaid. It is like a free money check written to you so that you can install a solar system for a much lower price. They will pay for half of your solar system (they actually will pay for up to 80% of the system if you want them too). Do not be shy about getting this grant!

We have had great success in applying for solar grants from the State of Tennessee in the past and we have been applying for (and receiving) usda grants and Tennessee Solar Institute grants for years for our customers. We know how to write these grants.

Your business, non-profit or municipality really deserves to get some of this money! You have been breathing these pollutants for years, now it is time for some payback!

This money may not help your asthma (or your kids), but it will certainly help out with your electric bill!

I didn’t realize it, but the solar system on our house recently produced one full Megawatt hour of electricity (1000 kwhs). I haven’t been tracking closely, but my friend has! I realized it when I got an email from Ted with the above congratulations.

I talk regularly with Ted and Denise Polczynski, friends who have self-installed one of the Simple Energy Works solar system kits.

Ted tracks the energy production from the solar system pretty closely. He is always talking about how the shading slows the energy production on one side or the other of his array. One of the best things that he enjoys about the Enphase Energy monitoring system is that you can see exactly how much energy each module is producing IN REAL TIME.

Ted regularly is checking out his array and my array production online at the same time. He tells me that he even knows when large clouds are going over the south side of the county (where I live) simply by the difference in our concurrent energy production. (Ted lives on the north side of the country).

Of course with this level of data one can easily figure out any shading issues on the PV array (and trim the offending branches as needed). One can also troubleshoot instantly.

For example, Ted emailed me the other day that I wasn’t producing any electricity. Well, I went over to my Envoy and my internet connection was dis-connected from the back (I had forgotten to re-plug it in after moving some furniture around). So- I was producing energy….. it just was not being reported to the Enlighten website. Easy fix, plug the cord back into the Envoy. Viola!

Now that is the kind of troubleshooting that I like to do.

Compare that with the following scenario (very real by the way). The disconcerted homeowners complain that their solar salesman said that their system would be generating 1560 kWh’s of electricity per year. Yet they had only produced 1344 kWh’s. They say- what is the problem? It is not producing how it should!

OK, so how do we attack this problem? The system is currently producing, but it may be 10%- 20% inefficient for some reason, but we don’t know why. We don’t know if one panel is damaged and slowing down the energy production on the whole PV string (a very common problem). Or possibly it is simply a connection between panels which is arcing (and therefore slowing down the energy production for the whole string(as in the previous scenario). Maybe one of the fuses on a string is blown so a whole string has been sitting there not producing anything for a portion of the year.

Could be any number of problems. We can come on out (at $75 an hour) and start to troubleshoot the system. Maybe we will find something. Maybe we won’t. It is entirely possible that the system is producing what it should be producing (with the current shading). It is also possible that the weather this year has been less productive for solar system owners (weather can fluctuate up to 10% a year).

The only way to really know on this type of a central inverter system is to hire a solar installer (we’ll be happy to come do it) to come out and test the whole system and see if it is performing as it should be. This testing can get expensive as you can imagine.

Now compare that to the ability that Ted has to not only test his PV system in real time online, but he can also compare it to my system (in real time) at the same time. He knows exactly how much each panel (individually) has produced for its whole lifetime.

The level of information that the Enphase Energy management system gives is significantly above any other energy monitoring solution. Which is great, but the best thing about it is that you can self troubleshoot any issue that may come up with your PV system. No need to hire an installer to come out and start “testing”. Your testing has been done continuously since the installation of the system. Think how much money that will save you in “troubleshooting” costs over the lifespan of the PV system!

Enphase explains it all in this video about the Envoy/Enlighten energy monitoring system.

I was talking with Ted last week and he mentioned that the electricity meter from our utility company was slightly off with his Envoy. He had me go out and record my utility meter versus my Envoy energy meter. We found out that there was a 5% difference between the two meters FOR BOTH OF US. Mine was a little further off, but both were just under 5% different.

We looked at the specifications of the Utility meters and those have a 5% tolerance. Add that to the 3% tolerance from the Envoy and any number within 8% is still within “official” tolerances. So, both of our numbers were OK, but we could only track this kind of stuff with the detailed information given by the Enphase Envoy and the Enlighten website.

If you want to take a look at Ted & Denise’s solar system production you can do so by clicking the photo to the right.     All of this data can be made “public” or “hidden.”   Ted doesn’t mind having his out in the public, but it is nice to have the option to keep your data to yourself (if you want).

Of course, Ted also has an app that he can use to track his energy production right on his cell phone. Why not, with the level of information so detailed, it makes total sense!

Ted currently has 7 panels on his house, and you can see his complete energy production. He is finishing up an addition on his house, but is getting ready to install another 14 modules (to triple the size of his system).

Information is king, and Enphase gives it to you. Don’t make the mistake of spending thousands of dollars on a PV system, and then spend all of your time wondering.

Unless you have access to good data, you won’t really know if things are working well, or even if you are getting your money’s worth!

Oh, one more thing. Ted recently shot me a photo of the 2011 annual production of his PV system. You can see how each panel produced individually. Nice!  2011 was a good year for those with solar systems!

Take Care,

TVA is constantly trying to figure out how to provide energy for the Tennessee Valley area. This quasi-governmental “New Deal” era agency (whose directors are appointed by the Federal Government) are regularly looking at the next 50 years and trying to make wise energy decisions.

We know that TVA has not always made good energy decisions. We are paying higher electrical prices today because of the poor decision making that has gone on at TVA in years past. No need to cry over spilled milk, we just want to make sure that we don’t keep on spilling the milk!

One primary example of poor decision making has been the coal ash storage at Kingston TN and the resulting spill/cleanup. Apparently spills/leaks had been intermittent (but small) for the preceding ten years, but on December 22, 2008, a retaining wall on a coal ash slurry storage lake broke and released over 1.1 Billion gallons of poisonous coal ash slurry into the surrounding environment (Emory, Clinch, and Tennessee Rivers).

Nobody was killed in the spill, but houses were pushed off foundations, land was damaged, and untold environmental damage occurred as fish and wildlife died en mass. Over 300 acres of farmland and residential neighborhoods were covered with the fly ash to a depth of over 6 feet.  Besides containing potentially harmful metals such as chromium, mercury, lead and selenium, as well as an unhealthy dose of arsenic, power plant coal ash, according to Scientific American, has so much concentrated uranium and thorium that it “delivers more radiation than nuclear waste shielded via water or dry cask storage.”

The cleanup is still continuing even after 3 years. Bulldozers and heavy earth moving machines have been busily scooping and sending sludge by train to an Alabama landfill. As of December 2011 approximately 20% of the slurry still needs to be cleaned up. Hundreds of lawsuits are ongoing and TVA has spent upwards of $750 million of the estimated 1.2 Billion dollars that the total clean up will finally cost.

The rate payers are getting rammed with the bill, as since October 2009 every TVA customer has been forking over an extra $.69 per bill…. and will continue to foot this cleanup expense for the next 13 years.

This spill was huge. It was ten times the size of the spill by the infamous Exxon Valdez. It is commonly accepted that 11 million gallons of oil were spilled in 1998 during the Exxon Valdez disaster. This fly ash spill was over 1.1 Billion gallons of sludge.

One of the reasons that the fly ash is stored in the first place is because of the National Clean Air Act (December 31, 1970- Also Happy Anniversary!). The Clean Air Act required that coal producing power plants could no longer spew poisonous heavy metals into the air causing damage to the surrounding environment. The smokestacks were fitted with pollution devices which trapped the heavy metals into a waste product called “fly ash.” This fly ash was then simply dumped in pits near the coal power plants. The fly ash has never been classified by the EPA as dangerous even though it contains all of the heavy metals that are illegal to spew into the air.

When fly ash is released into a water source all of those heavy metals which would have been in the air over the past 20 years or so are simply spread throughout the ecological environment (and will make their way into the drinking water). This is a dangerous game of switcharoo that TVA is playing. They grudgingly make the air safer, but transfer that danger directly over into our drinking water.

TVA released a report 2008-12283-02 in 2009 by their own inspector general that talked about the internal culture of management that helped cause the fly ash spill. It talks about how there were two internal reports on dangerous conditions at the Kingston fly ash storage site which should have been obvious red flags. The reports recommended strengthening the containment dykes at the Kingston site. Why these recommendations were not acted upon remains a mystery to this day. The report makes it clear that the spill was certainly avoidable- had conservative management practices been followed. It goes on to say that there are other fly ash storage facilities (in TN and elsewhere) that are also currently dangerous.

The report also says that TVA’s official statements seem to be “damage control” rather than really getting the the root causes of the disaster. These statements are apparently to “limit liability” rather than truly uncover how this type of a tragedy came about (and correspondingly how to avoid a future similar incident).

Hopefully TVA is starting to factor in the environmental costs of “cheap” coal. When these coal power plants were planned and executed nobody was concerned about any “clean-up” costs or environmental costs. Those heavy metals and poisonous gasses were simply pumped into the air for others to “enjoy”.  All of the health damages from this pollution is a direct cost of coal. It is not simply $.03 per kWh as their spreadsheets promise. The true cost of coal is much, much higher. And TVA should no longer pretend that these external costs, which have previously  been allowed to be transferred to “society at large” are a legitimate way to do business.

Actually, a recent report by Dr. Paul Epstien, a medical doctor at Harvard, who along with 9 others put together a study that looks at all of the “external factors” relating to the whole life cycle of coal. When these externals are factored in the price of coal more than triples. They state that “inexpensive coal” is just a mirage.  From the abstract:

Each stage in the life cycle of coal—extraction, transport, processing, and combustion—generates a waste stream and carries multiple hazards for health and the environment. These costs are external to the coal industry and thus are often considered as “externalities.” We estimate that the life cycle effects of coal and the waste stream generated are costing the U.S. public a third to over one-half of a trillion dollars annually. Many of these so-called externalities are, moreover, cumulative. Accounting for the damages conservatively doubles to triples the price of electricity from coal per kWh generated, making wind, solar, and other forms of non fossil fuel power generation, along with investments in efficiency and electricity conservation methods, economically competitive. We focus on Appalachia, though coal is mined in other regions of the United States and is burned throughout the world.

This study by Dr. Epstien did not even try to factor in any climate change damages, nor any heavy metal damages (which is one  of the big problems in Kingston).

The true cost of coal is hidden in our medical bills, in our poor health, and in our damaged environment.   If the true full cost of coal (including all externalities) is factored in then the kWh cost for  coal is between $.17 and $.18.    This makes all renewable energy technologies very competitive TODAY.

The decision making at TVA that has regularly allowed all of these costs to be paid by “those suckers down river” needs to change. We need to realize that if we “foul our nest” we will be living in a cesspool. There is nobody else to trash, we are trashing our own property. With clean energy options available, and dropping rapidly in price, we need to move decisively towards an energy model that does not damage “the commons.”

If TVA cannot lead with clean energy decisions it may be time to “topple the MONOPOLY” and allow free energy competition in the TVA region.    Competition will only sharpen the competitors, and TVA seems to be bureaucratic and sluggish (typical for government institutions).    TVA’s monopoly may have been a good idea during the “New Deal”, but in the age of computers and free competition it is time to rethink how we do energy, especially if the “traditional energy providers” are biased toward dirty, dangerous and damaging energy.

The residents of Kingston Tennessee, who are still scared to drink the water,  certainly agree.

Of course all through history we have heard this kind of commentary from the self proclaimed “literati”. Every major technological advancement has been met with scoffers and folks who are dragging their heels. Their arguments appear ridiculous now (looking back) because we have the “spectacles of history.” We can see things so clearly in the past. Hindsight is awesome!

A few examples:

There is a young madman proposing to light the streets of London—with what do you suppose—with smoke!
- Sir Walter Scott (1771-1832) [On a proposal to light cities with gaslight.]

The Kölonische Zeitung [Köln, Germany, 28 March 1819] listed six grave reasons against street lighting, including these:
1.Theological: It is an intervention in God’s order, which makes nights dark…
2.Medical: It will be easier for people to be in the streets at night, afflicting them with colds…
3.Philosophical-moral: Morality deteriorates through street lighting. Artificial lighting drives out fear of the dark, which keeps the weak from sinning…

[W]hen the Paris Exhibition closes electric light will close with it and no more be heard of.
- Erasmus Wilson (1878) Professor at Oxford University

Lest you think that these are simply examples of pig-headedness and prophetic impotence in the distant past, there are many recent examples as well:

[Television] won’t be able to hold on to any market it captures after the first six months. People will soon get tired of staring at a plywood box every night.
- Darryl F. Zanuck, head of 20th Century-Fox, 1946.

There is no reason for any individual to have a computer in their home.
- Kenneth Olsen, president and founder of Digital Equipment Corp., 1977.

How can intelligent people be so unbelievably wrong? They were not able to see even just a little ways around the corner. Many “futurists” are constantly making wild utopian predictions, which keeps us from taking the probable future seriously.

Who would have believed the rise of the internet and and “cyperspace?” Who would have believed the amazing rise of the cell phone industry? These industries have exploded and matured in the past 30 years.

Solar photovoltaic technology was already over 30 years in development when Al Gore “invented” the internet. Today we have solar modules that have been producing energy for over 50 years. The technology is mature, the prices are dropping significantly, and people are starting to realize the benefits that cheap solar energy can have on their constantly rising energy bills.

Once the PV solar system is installed- there are no ongoing fuel costs. There are no fuel drilling/mining/storage/transportation costs. This is huge. It is like paying once for a car and then never paying for fuel at a gas station. How much would a car that never needs to stop at a gas station be worth? That is the type of system that we install when we intall a PV solar system today.

I hesitate to predict huge gains for solar. The big energy players of today are heavily invested in coal and nuclear energy. It will be hard for an industry based upon mining/drilling and burning to switch over to a solar energy model. Even when it is in the best interest of all parties involved many will stick to the “business as usual” model.

The essence of “conservatism” is to conserve something (ie- a way of life). The question is legitimate: “Should our current energy system be conserved?” We mine, drill, store, transport, and burn. Is this method of using fossil fuel sustainable? If not, what is the next step? Will this model become even more expensive through time as fossil fuel becomes more scarce?

50 years from now when we look at our energy mix the dominant energy sources will be renewable energy. Why? Because these technologies make sense. If we can drive down the prices (which is happening) why not use renewable energies? Why should we keep drilling/mining/transporting fuel/storing fuel/burning fuel? There is no advantage to the fossil fuel technologies other than that they are  less expensive. They are cheaper. (if you don’t count pollution or health costs/damages they are currently slightly less expensive than renewable energy)

As fossil fuels get more expensive (through scarcity) renewable energy will come on strong (here’s my prediction) because they make so much financial sense. Not only will the financial benefits overwhelm the fossil fuel energy industry, but there is also the side benefit of not polluting our water, air or land. Not only am I saving money, but I am also sleeping very well at night know that I am not damaging or polluting the land that I will hand over to my children. I am a part of the “solution” rather than being “conservative” and perpetuating an unhealthy energy model.

The speed of change and innovation can sometimes be incredibly rapid. We can see how fast innovation was happening at the birth of aviation:

I confess that in 1901 I said to my brother Orville that man would not fly for fifty years. Two years later we ourselves made flights. This demonstration of my impotence as a prophet gave me such a shock that ever since I have distrusted myself and avoided all predictions.
- Wilbur Wright (1867-1912) [In a speech to the Aero Club of France (Nov 5, 1908)]

Wilbur was right to distrust his pessimism towards the new technology of aviation- and we should be confident in our optimism towards the technology of PV (and clean energy). As Bob Dylan belted out so many years ago… “the times, they are a changin.”

Stay Strong,

I have watched a few of them with my wife (to be social), and wouldn’t say that I was bored….. They just aren’t my movie preference.

Of course, I would enjoy the superhuman powers of vampires. Of course… I would like to live forever…. On the other hand, I am quite a big fan of powerful garlic bread… and I like the sun!

A group of my wife’s friends all went together as a “girls night out” to the midnight premier of the new “Breaking Dawn” vampire movie. They had a grand old time. Apparently Bella and Edward get married and have a “vampire child”…. I don’t really know they rest, but that is the basic plot line.

As the title suggests the dawn is finally arriving. No longer must life be lived in the dark.

The title is a metaphor of moving from the darkness to the light (as every dawn is).

 The solar industry itself is currently going through a “breaking dawn” moment. For the past 40 years or so the solar industry has been slowly maturing. For years solar was basically for the scientist working on space projects, or for the back to nature hobbyist who is trying to “get off the grid” or “stick it to the system.”

The industry has been patiently observed by millions of interested onlookers who are waiting for it to make financial sense. During these early years the industry has slowly worked through the growing pains associated with any new industry. There has been no dramatic growth, simply steady, slow improvements to equipment and processes. For years the prices have steadily decreased while the efficiency of the systems have slowly increased. The prices have been inching down for years.

Over these same years there has been a growing realization that we are moving towards an energy “crisis” of sorts. We have become so used to plentiful and cheap energy that we are now aware of the limits of our energy supplies. All fossil fuels are finite and running out. Scarcity inevitably causes prices to rise.   This has been the actual story of our energy situation for the past 30 years. All fuels are becoming more expensive. Wars are fought over oil and access to energy. It looks like future wars will involve energy as well. There does not seem to be an end in sight to the rising price of energy.

Not only have we seen the price of energy multiply, but we have also become much more aware of how the current energy that we use have been damaging our land and our water. With oil spills and coal ash spills and significant pollution issues in the air we breathe constantly in the news- we are starting to re-evaluate the full cost of our “energy addiction.”

All of these factors make the amazing growth of the solar industry in the past few years look like a “breaking dawn” moment. We are leaving the old energy paradigm and looking forward to the clean energy that the sun can bring. With a mature solar energy industry ready to rapidly move forward.

The solar industry has been growing at over 40% a year for the past few years- despite a national and worldwide depression. With over 100,000 full time workers there is capacity to really begin switching over our countries energy mix.

In the past few years grid tied solar photovoltaic systems have become very popular with small businesses and residential customers as a way to lock in their electrical rates and to protect themselves from future energy price increases. In many parts of the country (where there are higher electrical rates) solar energy has already passed “grid parity.” In other words it is definitely cheaper to install a solar system than it is to rely on the available utility with it’s expensive “brown” energy.

Of course, with a solar system, once the initial capital cost has been recovered, there is no need to every pay any price for an ongoing fuel source (like coal or natural gas or gasoline).   There will never be a side industry of mining, drilling, transporting fuels- because the sun itself is the fuel!    Delivered right to your location.

In 2011 there are now worldwide solar module distributors that can provide panels for significantly less than just a couple of years ago. The prices are dropping dramatically. They have dropped so fast that certain “American” manufacturers want protection from these low priced foreign competitors (no surprise there) and are petitioning Congress for protective tariffs.

I am bothered by the cry for tariffs, but I am excited that there is an apparent need for them. This is telling. The prices are dangerously low. It is hard to make a living selling modules. There are major manufacturers who are competing aggressively! Customers win from this kind of competition. The solar industry wins from this kind of competition. Our children and the planet win from this kind of competition!

 The light is finally starting to shine on the solar industry. It’s day has come. The breaking dawn will be brighter than we can even handle.

And we have a long way to go. Today there is still way less than 1% of our national energy produced from solar energy. 30% penetration in the energy mix is a good goal, and as the price of solar continues to plummet because of fierce competition and increasingly higher fossil fuel prices, and our desire for cleaner energy, that 30% goal will not seem like “blue sky” dreaming, but will be simply a road marker that we notice as we pass it by.

Those millions of interested observers now have the correct motivations to jump on board and start enjoying the energy from the sun that the 40 years of research and development and competition have now made so easily available.

Come to think of it… violently sucking the earth dry of it’s fossil fuel supply does seem sort of “vampirish”.

Lets enjoy the sunlight!

The news is busting with the solar module price decreases because of the increased production of China. The PV module prices have dropped significantly in the past 6 months. Now might be the very best time to install a PV system.

Congress is investigating a complaint of “Chinese” dumping of PV panels, and is threatening to put a tariff on Chinese panels. This threat has already started to make the future price of solar to bottom out (and to potentially rise). Now, at the bottom, is the time to see if solar is a good fit for you.

On December 31, 2011 there will be a few federal incentives that disappear. The first incentive is the 1603 Treasury Grant which is for 30% of the total cost of any Solar system. After installing a solar system you simply apply with the Treasury department, and within 60 days they send you 30% of the total cost of that system. It is a great program, but it only works for businesses, and it only works until December 31, 2011.

The second incentive that will be ending on December 31, 2011 is the 100% Bonus depreciation in year one for any installed solar system. This incentive allows businesses to depreciate the complete basis of their solar system in the very first year. This is huge, because normally real property must be depreciated over it’s complete lifespan (ie 27 years for buildings). What this fast depreciation means to the savy investor can be significant. As an example, if business installs a $100k solar system, then that complete cost can be removed from actual “income”. This lowers the tax bill for the business by $100k. If the business were in the 33% tax bracket (which many are) then the actual taxes for the year would be reduced $33k on April 14^th. So, this ethereal concept of depreciation translates over to real savings of cash at tax time.

Both of these incentives are for businesses and together they make it very cost effective to install solar. Now is the time to get a bid, while there is still time to do the install during 2011.

Another business incentive (for businesses in rural counties) is the USDA reap grant. This incentive is for 25% of the cost of any solar system. As far as everyone knows it will be available again in 2012 starting in May.

The one problem that we run in to is how can we get both the 1603 Treasury Grant AND the USDA reap grant simultaneously? It is possible to “double dip”- using this tricky two step move…

First, the solar system must be under contract and in process during December 2011. The 1603 Treasury grant has what is known as a “safe harbor” built in to the grant that allows people to start the project in 2011 and still be eligible for the grant if they have either done significant installation, or if they have purchased AT LEAST 5% of the total cost on materials for the system during 2011. If so, they are still eligible for the 1603 Treasury grant until October 2012. This equipment must be set aside and not co-mingled with any other equipment, but actually be strictly for the one install that will be eligible for the 1603 grant.

Once those “safe harbor” requirements have been satisfied then the project can be put on “hold” until May of 2012 when you can apply for the USDA reap grant. If you get the USDA grant you will be getting 55% back of the total cost of the system. Unfortunately, the Bonus Depreciation will not be available in this circumstance, because for that to apply the project must be completed before 2012 begins. Of course, once the bonus 100% depreciation has expired all solar systems are eligible for 50% bonus depreciation year accelerated depreciation or MACRS (so you can still capture those tax benefits mentioned above, it just takes you 5 years to do it rather than in year one).

Anyway, I hope these strategies will be useful and beneficial to you as you approach the end of 2011. We install solar systems here in Tennessee, so contact us for a proposal to see how many incentives you qualify for.

With the dropping of the prices of solar panels, and these last minute incentives, this may be the perfect time for you to finally install that solar system that you have been holding out for!

Enjoy the sun,