Solar Subsidies In Eclipse

  • Date: 16/07/10

One problem with relying on sunlight to generate energy is that it’s an unreliable source. The government is even more so.

The California Public Utilities Commission “stunned public officials and the solar industry” last week when it suspended “lucrative rebates” to public schools, municipalities and other government agencies for installation of solar panels on their buildings, reported the Contra Costa Times. Nonprofit groups relying on the subsidies also are affected.

Commission officials said a temporary suspension is necessary until they can decide what to do about the “rapidly depleting solar budget,” the newspaper reported. Some plans to install panels are expected to be canceled.

“That’s going to kill us,” complained Bill Savidge, engineering director for the West Contra Costa Unified School District, which was preparing to install solar panels at two schools. “Changing the rules in the middle of the game is just crazy.”

The “rules” regarding government-distributed subsidies are changeable by nature. None were written in stone to begin with, so whatever rules government commissars decide at any time are subject to change later by other government overseers.

Solar thermal energy not only is unreliable because sunshine can be intermittent, it is more costly than conventional alternatives. “Because solar collectors must be very large, they use high volumes of nonrenewable materials in their construction, resulting in high energy costs,” is how the National Academy of Sciences put it.

Consequently, solar energy requires subsidies to make it economical, in this case subsidies paid by electricity ratepayers, whether they want to or not.

To avoid running out of subsidy money that it redistributes, the PUC will consider lowering rebates to tax-exempt organizations. This is necessary because many more applications have been received than were anticipated when the Solar Initiative began in 2007.

The fact that demand soars when government gives away money – in this case in the form of subsidies – shouldn’t be a surprise. The popularity of the giveaway diminished the $1.7 billion set aside for rebates more quickly than was planned.

The suspension doesn’t affect residential or commercial projects, but will last up to three months while the commission gauges reaction to reducing rebates. “The worst thing we can do is have agencies delay (solar projects),” an official with the trade group Solar Alliance told the Contra Costa Times.

We disagree. It would be worse to rely on unreliable government-distributed subsidies to finance what already is an unreliable and otherwise uneconomical source of energy. As usual, it seems no one looked beyond the immediate gratification of artificially propping up something that costs more than its worth.

The Orange County Register, 15 July 2010


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