Solar Energy Numbers Don't Add Up For GA - By Dr. James Rust
The Georgia Public Service Commission is scheduled to vote on allowing utility scale solar plants July 11. I can not envision any way that this is good for taxpayers or rate payers. I am a landlord whose business allows me to take advantage of tax deductions and possible tax credits not available to the average homeowner. I considered installing solar panels on the roof of my property back in 2009. The benefits are described by the following:
A three KW system was going to cost me $24,000. There would be a federal rebate of $7,200; a Georgia rebate of $8,400, and the ability to deduct the system cost on my state and federal income taxes by depreciation. With a Georgia tax rate of 6 percent and a federal tax rate of 20 percent, this would have saved another $6,000 or more. Any electricity I didn’t use, Georgia Power would be required to pay me 17 cents per kilowatt-hour. This is a money maker. Taxpayers would have paid almost the entire cost of the system. Rate payers would be subsidizing the cost of power generation while receiving about triple the value in excess power rebates (provided the rebate dollars were available) and reduced payments. Meanwhile, Georgia Power would incur the cost of supporting new transmission lines, transmission line maintenance from frequent power outages due to acts of Nature, and other business costs for the utility. I didn’t build my home system because, I surmised, I might need access to the roof in the future; for example, shingle replacement. The Georgia rebates are limited to $5 million per year for residential and $5 million per year for commercial solar systems. Due to high demand, these rebates are essentially used up for the future.
Public Service Commissioners cite a need for renewable energy mandates out of a concern over the federal government acting to cut off coal use. Let’s go back to 1950 for power generation in Georgia. All electricity was from coal and a little bit of hydroelectric. Georgia got along fine in spite of United Mine Workers chief John L. Lewis threatening strikes and cutting off all coal mining. Coal was, essentially, the only fuel source for power generation. In 2013, natural gas is available everywhere and the country no longer needs coal in spite of its vast reserves that would last for more than 400 years. On top of abundant natural gas availability, Georgia Power has 4,000 MW nuclear to add to their supply and will have an additional 2,400 MW nuclear after 2018. Georgia Power has too much generating capacity for its needs. Adding more solar will mean shutting off existing capacity, some of which is in spinning reserve to make up for huge losses of electricity when clouds pass over large solar plants.
Advocates for solar power mandates argue that it provides electricity when Georgia Power needs it most during peak use. Georgia Power’s summer demand has a minimum at 6 a.m. in the morning and reaches a maximum at 6 p.m. in the evenings during weekdays when people come home in the summer and turn on their air conditioning. Solar plants have no power until about 9 in the morning, hit their peak at 1: 30 p.m. when the sun is directly overhead, and then decrease to zero around 7:30 p.m. Examining operating data on solar plants in the Atlanta area on SunnyPortal, it shows solar power outputs at 6 p.m. range from half their peak output to as low as 15 percent of peak output. Thus a 500 MW solar plant’s output will range from 80 MW to 250 MW at the time of peak power demand. This is a big loss of output at the most critical time. Another problem with solar plants assisting peak power demand is afternoon rainstorms can completely eliminate a solar plants output when it is needed most.
Due to their unreliability, solar plants do not allow utilities to reduce their generating capacity. Because of the need for rapid response to sudden cut off of large blocks of solar energy, utilities need equipment operating in modes that are not the most efficient use of fossil fuels like natural gas. This increases fuel costs. For this reason, also, solar is not responsible for green house gas reductions by as much as solar energy advocates suggest. The very fossil fuels they are trying to move away from must be relied on more heavily to compensate for the increased use of solar.
There are no utility scale solar plants in the United States without these massive taxpayer and ratepayer subsidies. With the exception of 100 MW in South Florida and 20 MW in North Carolina, I think all utility scale solar plants are out West in regions with far greater available sunlight. Most Western regions have 30 percent greater sun availability than Georgia. It takes a blind optimist to think solar possibilities in Georgia make any economic sense when solar plants demand subsidies in areas with far more available sunlight.
Proponents of solar energy in Georgia use economic models to justify the economics of their systems. I can not help but laugh at these remarks. President Obama uses climate models to justify his attempts to stop the use of coal for power generation and future attempts to stop the use of other fossil fuels. NONE of the climate models are able to make predictions that match actual conditions. The economic models to justify solar energy have to be just as silly. If you want proof, examine the economic model used to justify the Dublin School Board’s 25-year lease of electricity from a 1.1 MW solar plant sited on the Dublin high school grounds.
This is reprinted with permission from the author. It was originally featured from The Heartland Institute and can be found here.
James H. Rust, GA Institute of Technology Professor of nuclear engineering (ret.)