Building a solar economy

At a time when the bankster agenda of austerity combined with political corruption seems to dominate, discussions of what the real economy actually needs seem so idealistic.  Yet the "dreamers" here are actually the ones with the practical agenda and are dealing with practical problems.

Starting with costs.  For some reason, the technologically illiterates never stop trying to tell us that a switch renewable energy will be cheap and easy.  Well, no.  It will be very difficult and expensive and anyone who claims otherwise is blowing smoke.  In fact, the only reason why anyone should even contemplate a conversion to solar is that really, There Is No Alternative (TINA).

The Latte Fallacy
German Switch to Renewables Likely to Be Expensive 

By Alexander Neubacher   07/27/2011

Germany's rapid phase-out of nuclear energy may be more expensive than first thought.  Chancellor Angela Merkel's government insists that electricity bills will only grow modestly as a result of the nuclear energy phase-out. Experts, however, disagree, with many pointing to Berlin's massive subsidies for solar power as the culprit.
Free beer and bratwurst were being served at the construction site. Horst Seehofer, the powerful governor of Bavaria, was there, and eventually the sun even emerged from the clouds -- an auspicious sign for the Upper Franconia region's emergence into the solar age.

A pioneering spirit has taken hold in Germany, thanks to the government's radical reworking of the country's energy policies. Hardly a week goes by without the foundation being laid someplace in the country for a new solar farm, yet another biogas plant or an even bigger wind turbine. Fesseldorf, the town in northern Bavaria which just hosted Seehofer, will soon be home to one of the largest photovoltaic plants in the state.

The German government's plan calls for increasing the share of renewables in the country's energy mix to 35 percent by 2020. It is an ambitious goal in every respect. Not only will the current renewable energy share have to be doubled within a few years, the grid expanded and new power storage facilities installed. But Chancellor Angela Merkel's government is also somehow expecting the entire energy revolution to cost virtually nothing. 

"According to our calculations, the cost of a kilowatt hour of electricity will go up by only one cent," says Economics Minister Philipp Rösler, head of Merkel's junior coalition partner, the Free Democrats (FDP). For an average household, this would correspond to the price of only one latte a month, says Environment Minister Norbert Röttgen, of Merkel's Christian Democrats. Germany is rapidly switching to green energy and at almost no additional cost to consumers. What conservative politician would have thought such a thing possible just a few months ago? 

Systematically Overstated 

In reality, though, the official calculations have little connection to reality. According to an assessment by the Rhenish-Westphalian Institute for Economic Research (RWI), the politicians' estimate of the costs of expanding renewable sources of energy is far too low, while the environmental benefits have been systematically overstated. 

RWI experts estimate that the cost of electricity could increase by as much as five times the government's estimate of one cent per kilowatt hour. In an internal prognosis, the semi-governmental German Energy Agency anticipates an increase of four to five cents. According to the Federation of German Consumer Organizations, the additional cost could easily amount to "five cents or more per kilowatt hour." 

An internal estimate making the rounds at the Economics Ministry also exceeds the official announcements. It concludes that an average three-person household will pay an additional 0.5 to 1.5 cents per kilowatt hour, and up to five cents more in the mid-term. This would come to an additional cost of €175 ($250) a year. "Not exactly the price of a latte," says Manuel Frondel of the RWI. 

The problem is the federal government's outlandish subsidies policy. Electricity customers are already paying more than €13 billion this year to subsidize renewable energy. The largest subsidies go to solar plants, which contribute relatively little to overall power generation, as well as offshore wind farms in the north, which are far away from the countries largest electricity consumers in Germany's deep south. more

And the Japanese are discovering that it isn't just about costs.

Japan's Power Grid May Make It Impossible To Reach Post-Nuclear Energy Goals 

Vincent Trivett | Jul. 27, 2011

Since the nuclear disaster in Fukushima, the government of Japan has greatly increased their goals for cutting down fossil fuel and nuclear power. Their latest goal is to generate 20% of electricity from renewables by the year 2020.

This goal may be far too ambitious, or even impossible with Japan's peculiar energy infrastructure. Waseda University professor Hayashi Yasuhiro told the Japan Times that the grid that is currently in place can only handle about 10,000 megawatts of wind and solar energy--not even close to the government's target.

"Electricity from solar and wind sources is wild. The amount generated fluctuates greatly," Hayashi told the newspaper. "Everyone turns on their rice-cooker around the same time in the morning, goes to work and school around the same time, and watches television at night around the same time. That makes for big peaks and valleys in power use."

The energy infrastructure in Japan has its peculiarities. Each region is a self-contained system with one power company that controls production and distribution, and thus, a surplus in one area cannot mitigate a shortfall in another. They currently make up for differences between demand and supply by burning fossil fuels. With a less predictable source of energy like wind and solar, power companies cannot adjust the supply of power to meet demand.

Further complicating the matter, Japan lacks a single national grid. Western and Eastern Japan use different frequencies, a legacy of Tokyo's original German-built generator and Osaka's American one.

Prime Minister Kan has called for an overhaul of the energy network that could break up the power companies' regional monopolies. The political feasibility of this move is uncertain given the PM's dismal popularity in among Japanese, including members of his own party. The Liberal Democratic Party would predictably oppose tha too, since power company executives are among the party's top political donors.

Japan is a net energy importer. About 80% of Japan's energy is imported, mostly in the form of gas and oil. If they abandon nuclear and renewables can't catch up, Japanese might have to ditch the abundant neon, vending machines that use as much energy as entire households, and air-conditioning blowing out the open doors of convenience stores. more

Meanwhile, back in USA we still struggle to admit that significant technological change requires, you know, PLANNING!

Why We Need a National Manufacturing Technology Strategy 

The nation's economic health depends on a federal plan to support the revival of advanced manufacturing, says the president of a Washington-based think tank. 

WEDNESDAY, JULY 27, 2011  BY ROBERT D. ATKINSON

U.S. manufacturing is in trouble. Technological innovation, particularly in new process technologies, can play a key role in spurring a revival, but that won't happen without a coherent and well-funded national manufacturing technology strategy. 

First, some background. From January 2000 to January 2010, the number of U.S. manufacturing jobs fell by 6.17 million, or 34 percent. It would be one thing if this job loss were due solely to superior productivity. But output declined as well. From 2000 to 2009, 15 of the 19 U.S. manufacturing sectors shrank in terms of real value added (gross output minus the cost of inputs), and overall manufacturing output declined by 10 percent during a period when U.S. GDP grew 15 percent. Had manufacturing output maintained its share of GDP, we'd have two million more manufacturing jobs and eight million more jobs overall. 

This trend does not just reflect the loss of low-tech manufacturing as we transition to a high-tech future. In fact, the U.S. trade deficit in manufactured products is not seen just in low- to mid-technology products; the nation ran an $81 billion trade deficit in advanced-technology products in 2010, the largest in its history. 

One would think, given this dismal performance, that alarm bells would be sounding in Washington. But in fact, the Washington elite has justified this decline as either natural or irrelevant, claiming that manufacturing is falling off everywhere or that the United States is evolving to a superior post-industrial economy. Still others argue that we can lose manufacturing but still keep innovation. But as Dow Chemical CEO Andy Liveris succinctly states: "Where manufacturing goes, innovation inevitably follows." more

But hey, during the rule of the austerity ghouls, we cannot talk about new infrastructure when we will not pay to maintain the existing infrastructure.

Civil engineers estimate 10-year cost to economy of not fixing surface transportation: $3.1 trillion 

by Meteor Blades   WED JUL 27, 2011

Hundreds of thousands of jobs. Trillions of dollars. That's what it will cost the U.S. economy over the next 30 years if current trends continue in letting our surface transportation infrastructure crumble. That's according to the latest report by the American Society of Civil Engineers—Failure to Act: The Economic Impact of Current Investment Trends in Surface Transportation Infrastructure. 

The report concludes that for 2010 alone estimated deficiencies in surface transportation systems cost households and businesses nearly $130 billion. About $97 billion of that was in vehicle operating costs, $32 billion in travel-time delays, $1.2 billion in safety costs and $590 million in environmental costs. By 2020, the accumulated losses to personal income and gross domestic product are projected to be $930 billion and $3.1 trillion, respectively. 

Along with 400,000 lost jobs. 

If surface transportation were kept up to snuff, there would be 1.3 million additional jobs in "knowledge-based and technology-related economic sectors." But those losses would be balanced, if you can call it that, by the 900,000 jobs needed in "traditionally lower-paying service sectors of the economy that would benefit by deficient transportation (such as auto repair services) or by declining productivity in domestic service related sectors (such as truck driving and retail trade)."
Leave the potholes and it's a win for the auto-repair business. Nice. 

The costs of these deficiencies are spread across pavement and bridge conditions, highway congestion, rail and bus and trolley transit conditions. Just to keep "minimum tolerated conditions," the report states, would require spending $196 billion annually on roads and bridges plus $25 billion in rail and bus transit infrastructure (including rolling stock). more