Opinion

Germany Says Solar Energy is Path to Bankruptcy, Yet Obama Doubles US Down On It

Ed Farnan – One of the biggest national investors in green energy, Germany, is coming to the  realization that green energy is the path to bankruptcy. This is nothing short  of blasphemy in the green world to even make a partial admission that solar  power is not the panacea it was promised to be.

Germany invested  gargantuan amounts of money in green energy, doling out more than 130 billion in  subsidies to install solar systems and spends an additional 10 billion per year  subsidizing existing solar installations.

Yet after all of this capital  expenditure, Germany has little to show in terms of reducing green house gasses  and helping the country’s power needs. Despite massive investment, solar power  accounts for approximately three percent of Germany’s total energy… when the  sun shines!  To add insult to injury, Germans also pay the second highest  price for electricity in the developed world, due mainly to the fact that they  are heavily subsidizing green energy by adding the cost to everyone’s utility  bills.

According to Der Spiegel, members of Chancellor Merkel’s staff are  describing the policy as a massive money pit. Philipp Rösler, Germany’s minister  of economics and technology, has called the spiraling solar subsidies a “threat  to the economy.”

Germany will be cutting subsidies to solar sooner than  planned, and to phase out support over the next five years.
In spite  of  this ominous sign that solar may be a technology that will not reach  its dreamed of potential, President Obama has America on a headlong rush down the same  path of energy broken dreams that Germany has found itself on.

The green energy price tag for America under the Obama administration is  reaching into the billions. When you consider the energy policies that choke off  America from its natural resources and the subsidies to green energy by adding  the price tag onto consumers utility bills, we are talking more than billions,  possibly trillions, in outright costs and damage to our economy.

Does  Obama and his team of experts in the White House think that if we just throw enough taxpayer  money at green energy, it will magically become economically feasible? That the  rules of physics and economics will somehow be swept aside?

President  Obama should examine very closely what lead to Germany’s decision to basically  pull the plug on solar. President Obama has had plenty of red warning flags  along this path he has us on, some of these flags have names like Solyndra  and Evergreen Solar.

Another red flag is the cost of gasoline to  Americans; in some areas it is hitting over 5.00 per US gallon. Due to Obama  energy policies and tensions in the middle east, gas is getting very expensive.  Expensive fuel will increase the price of everything Americans consume and take  money out of their pockets at the exact time you want to encourage consumer  spending. This could tip the American economy back into the recession they tell  us we are no longer in.

Ed Farnan can be reached at [email protected]

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sclytrack
8 years ago

I believe that in the future everybody will get their electricity mostly from their own “private” electricity grid, that are connected to photovoltaic and wind power. Let’s say an entire city has their own grid. Excess is sold to the main grid. Purchasing electricity of the main grid will become more expensive and less people will start buying from it, since they’ll use their own grid. A bit like the internet. Large companies don’t like it that people install solar panels on their roofs and will lobby against this. You and your neighbours, it’s time to create your own private grid. Span your LAN cables to your neighbours. Main grid lines will be more for emergency current and will be expensive. If you haven’t created your own private grid you’ll have to rely on the emergency current main grid line which will be very expensive.

Don W.
8 years ago

This article is nuts. Germans love their solar energy and there is not the slightest chance that they will not continue to be a world leader in solar energy. They are reaching price points that are quite impressively low. Given the price trajectory of solar anyone is just insane to build a nuclear plant. By the time it is completed the cost of produced solar energy will make it look like an archaic dinosaur.

Kent Ridgeway
9 years ago

I read your article “Germany Says Solar Energy is Path to Bankruptcy, Yet Obama Doubles US Down On It” and you did an excellent job of presenting one side of the issue. While I may disagree with Obama’s oil and gas policies as I believe accelerating domestic oil and gas exploration and production is the fastest path to energy independence, ultimately the US and the rest of the world will run out of oil. This is at best, only a few decades away!! This is quite clear in US Governments reports where data was taken from all walks including academia, industry, and even the oil companies themselves! What then? Shut down all commerce? Solar and other energy alternatives are a must for the future in order to slow down the oil consumption and utilize oil more intelligently. Most people do not realize that nearly everything we rely on from carpeting, plastics, clothing, transportation, almost everything we use, starts from oil as a precursor. It is foolish for the US to utilize oil for electricity when other methods are available.
Germany changed the world with their long running energy policies. Germany started the ball rolling worldwide by instituting it’s solar friendly incentive policies over many years. They have a solar industry with a couple hundred thousand employed which has bolstered their economy in addition to creating an approximate order of magnitude reduction in production cost. Germany is on a course as planned originally to begin a gradual downsizing of the energy incentives as they become less needed. It is true though that incentive reduction has been accelerated. This acceleration is ultimately due to the devastated world economy created by the US housing loan industry as bad loans that were packaged into REITS and other securities ultimately crashed thanks to US congressional policies for that industry. Fortunately solar production prices have dropped from $10-$12/watt when the incentive programs started to under $1/watt. One of the things I agree with for the Obama administration is that the US must create incentives for solar and other renewables to become mainstream. Of course, it could well be argued that it could be done much more efficiently and It became obvious long before Solyndra’s crash that a return on that $535,000,000, at least in my opinion, would have done tremendously better if invested in a large number of smaller research opportunities that had huge solar efficiency upsides.
Even Bush, an oil man, quite obviously must have known that peak oil had passed and that supplies would start to dwindle. Why else would an oilman institute a 30% tax credit for solar energy? Fortunately, with thanks to Germany and thanks to Bush and his incentive policies which so far have been continued, followed by California’s Billion dollar rooftop incentive program, solar will soon be competitive with oil economically. At that point we merely need to massively ramp it up and cover the deserts and other suitable areas with photovoltaics to reap the benefits. The environmentalists will have to eventually realize they can’t have it both ways and that covering the deserts is a far better proposition than the alternative as otherwise it eventually would become necessary to decimate the land and oceans for oil extraction in order to meet the ever rising energy requirements. The production cost equivalency point is around 60c/watt which some companies such as First Solar, claim to already have achieved. My greatest fear is that the incentives will be removed just shy of execution, and the US will fall back into the 70’s morass where solar begins to again disappear from the US. Like it or not, worldwide solar is coming. If not produced from the US, then like autos and electronics before, the benefits will be reaped by manufacturing companies overseas.

Sincerely,

Kent Ridgeway

Wanda
9 years ago
Reply to  Kent Ridgeway

You have a fixation of solar power.
You may want to look into the rocket scientist who invented a miniature power plant called the “Bloom Box”.
It’s now being tested by powering the Google Complex, as well as offices for Ebay, Bank of America and Wal Mart.
About a year ago There was a great show on “60 Minutes” -Really Promising

Wanda
9 years ago

LET’S START WITH CLEARING THE AIR IN WASHINTON!

In 2004, Professor Alan J. Ziobrowski, Ph.D., of Georgia State University, published a study that examined the performance of the stock portfolios of members of both houses of Congress. His research found that both outperformed the market. The Senate outperformed the market 12 percent per year from 1993 to 1998. The House outperformed the market six percent per year, the same rate as corporate insiders who legally buy and sell their own stock. Members of Congress are privy to a substantial amount of information as they propose and pass legislation that affects various companies and industries. This knowledge gives them an informational advantage over the average investor.

Promoting Green Energy is supporting the stock portfolio and investment of our entrenched Representatives.
It has never been about the enviorment. Follow the money trail to the Bank Accounts of Pelosi. Gore, and other long term fixtures in the Senate.

How do so many of our Senators and Congressmen gain their fortunes while in Washington?
It’s time to clean house and think seriously about term limits.

DJ
9 years ago

Interesting article. First socialized medicine, now socialized energy. Having lived “on the economy” in Germany the idea of socialized medicine gives me the horrors. Why do we imitate inferior systems????? Yes, I know, it’s all about more centralized government.

Meanwhile, Dow has introduced solar shingles and is test marketing them in the Denver, CO area. The big advantage is that these can be installed by a regular roofer at little more cost than normal shingles. I am not sure what percentage of energy these will save but I can see this as a boon to sunny states like CA and Florida.

My point is….Get the EPA off our backs, give free enterprise free reign and we can solve the problems.

A.T Riccio
9 years ago

Interesting article on Green energy ..These efforts are mosty driven by Groups turning these efforts into money making scemes . I an part of group of scientists who have been working on a self sustaining magnetic devise that will change the way we make electricity to use to power our homes ,Auto’s Marine, and any other form of transpotation needs .Unless these efforts fall within the normal venue of the ‘Green progams’ NO one will listen to any other alternative power source …We have spent many years and millions of our own money to bring this new science to the world …The solution to our energy problem is here ..All we need is an open mind.Scientists have taken on an ellement of a ‘cult’ unless you fall within their model you are ignored …Almost all the Green efforts are not cost effective or just a waste of money and will never solve the Energy problem .The Green groups are nothing more than political entities and are not realy interested in a solution[s].. …Remember this co. Independent Energy has the answer .

Dave
9 years ago

Some of us seniors learned that just because you had plenty of cheap anything didn’t mean you didn’t have to conserve it, re-use it, and in general take care of it. Each commodity we have is finite by it’s very nature, may or may not be “renewable” and the concept of “sustainability” is a matter of conjecture to say the least because its based on our preconceived notions at the moment.
Some other aspects to think about are, are we grateful for what we do have whether little or much, do we share what we have, this if nothing else separates us from those who are ungrateful and think only of themselves.
These are totally foreign concepts to those who fail to appreciate what it means to be an American such as the current occupier of the WH!
Its just this type of behavior belying his claim at being a “Christian”, an American, or someone who wants whats best for anyone but himself.

Ladd Prier
9 years ago

We are being governed by radical demagoguery from all directions, mediated by our radical-in-chief via dictatorial regulation. Obama displays incompetence in many areas but most critically in his failure to understand the lack of real science behind the suicidal agendas being pushed by the radical greens: the anthropogenic carbon dilemma has not been verified absolutely and solar power is too diffuse and intermittent given present collector efficiencies to drive any significant part of grid needs. Research expenditure on energy is good; destroying our fossil fuel industry before technology to replace it is available is criminal and murderous.
There are sufficient numbers of perceptive individuals, regardless of political bias, to see and understand the dangers presented to the country by this administration and to oppose them and limit the damages. We will have no one else to blame when the leading economic nations of the world decide that it is no longer wise to contnuously loan America 40% of its budget.

Momcat200
9 years ago

In West Texas, the huge wind turbines have ruined the landscape! They are massive, hulking, behemoths that are inefficient, noisy, and prone to catching on fire and falling. It used to be nice to look out over the horizon and see the hills and the beautiful colors, but not anymore.

Nikki
5 years ago
Reply to  Momcat200

They are in the northwest too. Big old white elephants littering the land. 17th century technology and no one know what putting them on the wind rivers of the world will do, except tragically kill the bird who use those winds.

Dilbird
9 years ago

It’s said that the empty barrel makes the loudest noise. I guess that it’s especially true when talking electric power.
Many of us draw our conclusions based on what WE think is right, what we read, or what seems logical, but really have no knowledge whatsoever of how it all works. Next, the same folks will be directing brain surgeons on how to operate. Who needs an Medical Degree… or an Electrical Power Engineering degree, right?

Well it’s not so simple, and many are totally clueless. Solar energy is not free nor is wind energy. Maybe someday photovoltaics will be cost effective. Maybe someday windy energy will be too… I mean WITHOUT gross government subsidy. To make them manageable, maybe someday there will ways of efficiently storing bulk power (other than hydroelectric deferral). But NO TIME SOON. Nope, no batteries big enough, and we couldn’t afford them anyway.

Truth is, forcing these “green” (unripe) technologies on us only serves to overly complicate an already too complex electrical system. Just dispatching bulk power is a already nightmare now.

Utilities have a MAJOR STAKE in procuring safe, efficient and legally compliant power, according to our country’s environmental regs.. When green energy makes sense, they will invest heavily in them, and love it.

What ne need is good R&D, such as done by EPRI; now THERE is a GOOD place for investing in the future. Allowing manufacturers tax breaks for pure industry-beneficial R&D is another. The idiots in Washington know nothing about our industry. They think we (they) can rewrite the laws of physics magically, by will (or edict).

I have a 38 year career in Power Generation, High Voltage Transmission and Distribution in the office and in the field to back me up, PE’s (ret) in multiple states and am still a senior member of IEEE/PES. I’ve seen first hand and close up what bizarre government actions can do to mess up a good electric system. What ever happened to common sense?

al003
9 years ago
Reply to  Dilbird

Common sense is something very uncommon with politicians and completely missing from the minds of those who vote for the pols.who drive the system. With our technology based education today we will never get there on our own. We will have to team with Japan and China, they seem to be more interested in this kind of engineering than we are anymore.
One day, when we develop the storage capacity and learn to harvest the full spectrum from the sun, this Solar will be viable. But I am speaking about many years and lots of money spent on research and development.
Rigjht now Solar and Wind are pipe dreams fed to the masses because they will eat it up.

Nikki
5 years ago
Reply to  Dilbird

Common sense doesn’t make money for rent seekers and their political cronies. At this point America’s future is dim.

Roylyn
9 years ago

In reality, obama is using this as just another tool to destroy America. That has been his intention all along, bankruptcy being the primary tool. I (for the most part) believe the article – I have no reason to doubt it, especially with all the proof that we have a terrorist squatter in the White House. Liberalism has put us on the freeway to destruction.

Jim
9 years ago

I hear all the information about solar, I have been a proponet of solar since the 1970’s however they still have not made it cost effective. Unless Green energy becomes cost effective, it will not sell in America. It is excellent for off the grid applications but is useless for the average everyday use. I believe that the Obama administration is artificially increasing the prices on energy (taxes etc.) for the sake of increasing the interest in Solar and Wind.

Uwe
9 years ago

This article is full of wrong facts. The reduction of subsidies is not a sign of failure of the plan, but of its success.

It has always been planned that the subsidies should be high in the beginning in order to stimulate research & development and, in particular, mass production of solar energy modules, so that they become much cheaper. With falling prices, the subsidies were planned to be reduced accordingly.

And indeed the proces for photovoltaic systems have become much cheaper, leading to more people installing photovoltaic cells than planned, thus the subsidies are reduced even further. What a nonsense to say this is a sign of failure!

The article states that there have been 130 billion (of what?) of subsidies yet, but “solar power accounts for approximately three percent of Germany’s total energy… when the sun shines!”

This completely wrong! First, there never have been 130 billions of subsidies yet, neither in euros nor US-$. So far the system has accumulated 81.5 billion euros (109 billion US-$) of payment duties – but for ANY KIND of renewable energy, not just solar power. And these account for 20 % of the electric power in Germany, whether the sun is shining or not. 10 years ago it had been only 6%!

Second, I have no clue what the author means by “energy”. Thsoe subsidies are only for electricity, which of course is only a minor part of the energy consumed. Most energy is for heating, cars etc., only approx 15% of it is electricity. So what do you think a reader will gain out of those “3 % when the sun shines” except a totally biased view on the truth?

Electricity prices in Germany have always been amongst the highest in the world, mainly due to the oligopolic structure of the market and strong regulation without true competition.

This whole article is nothing but a useless rant against technologies that lead into the future. And America is completely going to miss it. Look at all those household appliances in the US – they are still 20th century technology when it comes to energy efficiency, things that nobody in Europe would dare buying anymore.

The per capita energy consumption in the US is double as high as in Germany – without any significant difference in the standard of living. Just because of thoughtless habits instead of intelleigent energy management.

The US have so much more space and so much more sun than Germany – so just use it! And your brain!

Barackinsane Obummerizback
9 years ago
Reply to  Uwe

You, sir, are an idiot . . . if not a useful one. The article recounts Germany’s experience with alternative energy. Spain had the same experience. STFU.

FlaJim
9 years ago
Reply to  Uwe

No subsidies were required to develp the oil industry, the electric utilities, the auto industry, the aircraft industry, the telephone, the lightbulb, the personal computer — I could go on. Anything requiring a government subsidy will be a money pit. Anything that is viable and marketable will attract private capital and either succeed or fail on its own.

al003
9 years ago
Reply to  FlaJim

It is so nice to read a column that is written by someone with a clear understanding of our capitalist system.
Maybe with reeducation of the masses, or maybe that is the wrong term, for it implies that the masses were already educated. Be that as it may, if we start teaching the real Capitalist System and live it daily in this country maybe, just maybe, we will be able to slowly turn this tide of Socialism back, and once again become the country that our founders gave us.
Think about it…. 2012 may be the last chance to save this Nation…

Mohs
9 years ago

You mind if somebody from germany helps you with these numbers?

@Mikel Moore:
Your general numbers are correct in the first place, but the conclusion, that the high price could be generated by the nuclear plant shutdown is wrong. Actually we are still netto exporters. Especially during the past cold winter days solar and wind power have kept the power running in europe!
Especially france has imported german solar power as their (>50) nuclear plants had serious issues with frozen rivers. Also france had spend way too little into power efficiency compared to germany.
(Just think of it: nuclearly heat water, to create electricity, to finally support electrical radiators)

About the article:
Well there actually is one minister in germany trying to stop the solar progress. His party is already meaningless to germany’s population. (Latest Surveys state <3% for the FDP) This ministers decision is obviously a result of corruption, don't think that this attempt will last very long, it will for sure be stopped.

@Ken Langford:
Don't you think, that having multiple sources is a good thing to have?
Please take a look at Japan, they already managed it to shutdown almost every nuclear power plant. How do they still get electricity? By burning oil and so raising the costs and further limiting this ressource. Would they had more diversity this step would have been much easier.

Generally:
In Germany it's the solar power, that's reducing power costs. There is an issue you should know by yourself of a small oligarchy of old power companies which keep the difference to themself.

About your cheap nuclear power:
do you really think that's cheap? you might not pay the price by electricity bill, but by taxes. And if you think that's still lesser than what german people pay: Think about what your children will pay for the power you use now ;)

Sedona Mike
9 years ago
Reply to  Mohs

Japan – PLEASE PLEASE get you facts right before using your keyboards:
The Federation on Electronic Power Companies are owing and operating 52 power plants and a private company named as Japan Automatic Power Corporation is operating another 3 plants. totally we can say it as 55 nuclear power plants are there in Japan. the largest Power plant is Tokyo Electric Power Plant
Source(s):
bloomberg

Mohs
9 years ago
Reply to  Sedona Mike

sure, to shut them all down, you first need to have them. What’s your point?

Ramdhani
8 years ago
Reply to  Mohs

Take a by cycle wheel without tyre. Fix six nmubers plastic funnel on its outer that are used in petrol bungs. If you keep it on your house top horizontally it will rotate by wind.You can just fix a toy D.C motors usually available in any battery operated toys.Connect it suitable to rotate the shaft of that tiny motor. You can connect a L.E.D bulb.That will glow.Instead of cycle wheel you can connect it in plastic fan and show it under tap water .That will also rotate and produce energy to light up a L.E.D.

Jerry
9 years ago

Solar and Wind energy is putting millions in the pockets of “Green” companies mostly owned or aligned with Al Gore and his multi-groups. Proven to be a possible future form of energy, our present technology isn’t there yet. Our present leaderhip in office has done more to slow down or stop energy ideas and search than at any time in our past. The “green” they talk about is the Greenback’s going into their off shore bank account.

Mikel Moore
9 years ago

What is the source of your information? It seems you conflated green energy as a whole with one small portion of it. Per the Christian Science Monitor and Spiegel Online International green energy now accounts for 20% of Germany’s energy production, with this breakdown from Spiegel:”Total usage in Germany remained stable from 2010 at 275.5 billion kilowatt-hours, but energy from sources like wind, biomass, hydroelectric plants, solar panels and waste incineration rose to 57.3 billion KWh in the first six months of this year.

Wind power, the most important source, rose to 20.7 billion KWh, or 7.5 of total usage. Biomass (5.6 percent), photovoltaic solar (3.5 percent), and hydroelectric power (3.3 percent) were next in line. Waste incineration and other sources covered 0.8 percent of total demand.”

Finally, don’t you think that Germany closing down their nuclear power plants and importing a significant portion of their power has something to do with the high prices Germans see?

Jim McDaniels
9 years ago
Reply to  Mikel Moore

Per kilowatt hour produced, nuclear, coal and natural gas are far cheaper sources to produce energy than solar, not to mention more reliable. When you add in the cost of operating a coal or natural gas plant on standby to back up fickle solar energy, solar becomes more expensive. Germany would have been better off spending all that wasted solar subsidy money on nuclear, coal or natural gas power plants.

Ken Langford
9 years ago
Reply to  Mikel Moore

No, I don’t think Germany’s closure of nuclear power plants has anything to do with logic at all. In fact, recently, Germany fired up those plants again because the wind was simply not providing energy to their grid. Throughout Europe, so-called “green energy” is bankrupting governments. In America, the people lost millions in their forced investment in Solyndra. We are tired of seeing people like you trying to brainwash the masses into thinking that these government subsidized “renewable resources” are anything but the biggest scam in the history of the world. I left AARP due to this nonsense. Go sell your “green” tripe somewhere else.

Pault
9 years ago

Obama comes across as just not giving a flip. His demeanor reflects a total unconcern for the nation he presides over. But it seems the saying that “a nation gets the kind of government it deserves” is true. The past two generations, for the most part, don’t care about the rule of constitutional law. They are only interested in their own bellies, not the principles that protect our freedoms, and make our nation strong. So heartbreaking!!!

Harold
9 years ago

This person in the white house has to go in 2012.

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