Group items tagged

Yet another story of apples and oranges.

It looks like a scene from an old episode of The X-Files: As a red-tailed hawk circles overhead and a wild pronghorn sheep grazes in the distance, a dozen people in dark sunglasses move methodically through a vast field of golden barley, eyes fixed to the ground, GPS devices in hand. They're searching for bodies. In this case, however, the bodies belong to the endangered blunt-nosed leopard lizard, and the crew moving through the knee-high grain are wildlife biologists hired by Ausra, a Silicon Valley startup that's building a solar power plant for utility PG&E on this square mile of central California ranchland.

This merits revisiting. With the recent collapse of the Spanish market, the correction of the German market and the expected collapse of the French PV market, FITs prove unsustainable or victim of their own success. Once the market picks up, governments can no longer support their price tab. Moreover, they are based on a false premise: the cost of taking a technology through the learning cycle is prohibitive - it requires too many tens of billions.

The topic is complex. Some underlying questions: * Why promotion of renewables was set-up? * What is the complete economic balance of renewables promotion? (expenses in subsidies, but savings in fuel imports, job creation, exports.... some interesting studies have been done on this - see for instance Macroeconomic study on the impact of Wind Energy in Spain - http://www.aeeolica.es/userfiles/file/aee-publica/091211-executive-summary-2009.pdf) * Is the allocation of subsidies cost done correctly? Electricity consumers often pay extra-cost, but benefits go to other pockets. Should there be a cost re-allocation to make the model sustainable? * Is regulatory framework evolving less rapidly than technology? FITs on PV in 2008 could be significantly reduced compared to FITs in 2007, and so on. How to accomodate regulation to that quick cost reduction? * Had governments defined a cap in global subsidies amount? Not really, this explains why they are all reacting to initial plans. * Development of technology and market drives costs down. Why some few countries should make this investment to the benefit of the entire world? * Have we excessively promoted market growth and neglected technology development? Are we paying too much for building power plants with primitive technology?

@Fernando - I agree that the topic is complex. However, I'd refrain from making claims on employment effects. This is an area where secondary effects are rarely taken into account. While I realise these claims are popular, basically nobody knows.