Now we are here...

Mr. Simmons, you assert that 'If all, or even most, fossil fuel subsidies were eliminated today we would be there' -- i.e., producing renewable energy at a cost people can afford.

I'm all for eliminating inefficient fossil-fuel subsidies. But your claim is hard to substantiate, given that standard subsidies and tax breaks to fossil fuels are a fraction of their unit price.

Now, if what you really mean is 'If all, or even most, fossil fuel subsidies were eliminated today AND, WE WERE TO LEVY ENVIRONMENTAL TAXES ON FOSSIL FUELS TO ACCOUNT FOR THEIR EXTERNAL COSTS we would be there', your assertion would be more credible.

Hello Mr. Steenblik,
Well stated, and quite correct. When the true costs are taken into account no one would buy a fossil fuel again. Who knows when that will happen?

But I also meant it, acknowledging in a limited way, as a purely direct competitive cost analysis. This is from the trenches, having sold residential and commercial solar for the past four years. If the $4 billion for oil gas and coal per year was removed, and if electricity rates went up as a result (they might not), we could compete on a relatively level playing field... our production cost nearly equal to average national residential rates. Except that the fossil fuel plants were built with subsidies which of course cannot be taken back. Our annual $1.8 billion for the Investment Tax Credit helps somewhat to offset the legacy incentives for fossil fuels.

On a Return on Investment basis we already win because there is no ROI when you simply buy power from the utility. But that is not good enough due to the barrier of the up front cost of a solar array. We need to be affordable. The lower modules prices have improved our situation dramatically. Banks still are not loaning money though.

Best,
Mark

Mark,

First, the $4 billion in tax measures, if repealed, would translate into less than 35 cents per barrel equivalent of oil and gas consumed in the United States, or less than 1 cent per gallon of gasoline equivalent consumed. Even if oil and gas prices were to rise by that much, it would hardly make a difference in terms of electricity prices, especially as very little oil is used any more to generate electricity.

You then argue that "[e]xcept that the fossil fuel plants were built with subsidies which of course cannot be taken back." What subsidies, precisely? And how much does that translate per kWh?

Look, I am not disputing that by changing policies the field could become more level. What I am trying to do is to get people who make these sweeping kind of statements to provide numbers (or links to calculations by people who have), or at least acknowledge that they haven't actually run the numbers.

Cheers,

Ron

Hi Ron,
Thanks for your further comments. I expect that you have much more knowledge than I do on past government incentives for constructing coal plants during the past century. My sweeping statement does not come with exact numbers. Therefore it is an opinion not a fact.

My work takes me into businesses, homes and municipals to work up a plan the add energy efficiency equipment and solar PV systems. Sometimes geothermal and solar thermal systems as well. I know the arguments in favor of and the roadblocks against someone signing a contract to buy their system.

Now as a distributor of PV and EE equipment I am working to show solar installers how to sell more solar. This is a micro view of things, not a macro view.

My post was in part to rally morale after the demise of US solar manufacturers. It bears on Evergreen's bankruptcy last March because Sovello is the German Evergreen plant. The modules price drops directly effect the industry, for good or for ill depending on how we deal with them.

Best Regards,
Mark