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The price of solar power just fell 50% in 16 months

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Re: The price of solar power just fell 50% in 16 months

#251

Post by puranjay »

coryfklein wrote: post #215
ChuckMcM wrote: post #103

The aggressiveness of the price drops on solar is pretty amazing. I just lost one of the inverters on my grid-tie system after it had run trouble free for 13 years. So we're looking at the first "major" repair to the system I installed in 2003. And in 2003 my 5.2kW of panels on my roof cost $38,000 before subsidies and $19,000 after. 28 panels, two 2.5kW inverters, net about 4.2kW of generation. I priced out replacin…

> And that is why it is a huge problem for the power companies It is a problem, but not necessarily in the way you may be thinking. Peak residential power usage is in the evening when solar isn't available. Power companies therefore end up spinning down coal and natural gas during peak solar, then just spinning them back up again as the sun begins to set. [1] So you haven't replaced the coal and natural gas plants, y…

Wait 5 more years and batteries will become cheap enough to even remove that constraint

Re: The price of solar power just fell 50% in 16 months

#252

Post by dragontamer »

criddell wrote: post #249
dragontamer wrote: post #171

Earlier quoted context omitted.

Biggest power hog? Yes. But not the only thing. My point is that its way too idealistic to assume that 100% of the costs will be covered. I mean, yes, the laws as written seem to encourage a 1-to-1 transmission of energy. "Net Metering" is a law that subsidizes decentralized solar energy. But in the future, when the subsidies run out and the laws are written to be FAIR (instead of written to encourage solar, as they…

I'm not sure what you mean by 100% of the costs will be covered . All I know is that I can reduce the amount of electricity that I buy during the day when I consume the most. The savings are greater than the cost so it's pretty much a no-brainer for me at this point. If I finance, I can pretty pay for the system with the money that I'm no longer using to buy electricity. > when the subsidies run out Why stop subsidiz…

I think that net-metering is going to go away once solar adoption reaches a certain critical mass. You can't keep giving away free batteries to consumers, someone eventually will need to pay for those batteries.

Other solar subsidies may remain a bit longer. But net-metering is probably the biggest once.

> I'm not sure what you mean by 100% of the costs will be covered. All I know is that I can reduce the amount of electricity that I buy during the day when I consume the most. The savings are greater than the cost so it's pretty much a no-brainer for me at this point. If I finance, I can pretty pay for the system with the money that I'm no longer using to buy electricity.

SunEdison's model has been proven to be incompetent. SolarCity's "MyPower" loans have been scuttled. That's WITH the current large number of pro-solar subsidies that the US Government is paying for.

I think that it's a "no brainer" to take advantage of SolarCity's deals as a consumer. But in the long-term, it looks like their finances are unsustainable.

Personally speaking, I'm more concerned about a long-term reliable model that manages to get the energy to the most number of people. Utility scale solar seems to be the best solution, although its a bit boring.

Re: The price of solar power just fell 50% in 16 months

#253

Post by ju-st »

dragontamer wrote: post #135
cmarschner wrote: post #131

Earlier quoted context omitted.

ROI can only be one factor. The other is that you are suddenly using clean energy. Doesn't this make you feel better?

The typical American median household income is $51k. Spending $40,000 of that on "clean energy" so that they can "feel better" is well outside of the typical person's price range. Even $7000 would be cost-prohibitive, especially if they're paying or saving up for their kids. A cold can of beer also makes you feel better. Its a hell of a lot cheaper too. The answer for the typical American is to wait for utility-scal…

> The typical American median household income is $51k.

The relevant number is "Amercian median house-owning household income"

Re: The price of solar power just fell 50% in 16 months

#254

Post by ry_ry »

Solar remains a long-term choice, though.

I love the idea, but I'll have sold my current house before a suite of solar panels pays for itself, and from my limited knowledge, the price of solar-equipped houses doesn't reflect the investment before it's paid for itself.

Disclosure: UK, we have no sunshine.

Re: The price of solar power just fell 50% in 16 months

#255

Post by downandout »

"One can suspect that Masdar had access to long-term financing through the wealthy emirate of Abu Dhabi that no commercial banks, the primary source of capital for the other bidders, could match in cost."

I was excited by this headline until I read the article. This price drop is the result of advances in financial - not technical - engineering. It means nothing for the cost of solar outside of this specific deal, as below-market interest rates are just more subsidies. This is yet another eco-clickbait headline.

Re: The price of solar power just fell 50% in 16 months

#256

Post by lucisferre »

ChuckMcM wrote: post #241
thechao wrote: post #140

Earlier quoted context omitted.

Is this DIY, or installed? If it's not DIY, mind passing along who you're using? Inquiring TX minds would like to know!

My wife and I designed the system but it was installed by a Los Gatos company that did not survive. As part of our education efforts, my wife completed a program to become a certified solar installer (you needed to be certified to get the full rebate at the time) but one of the women she met in the class was working at this company and it just made sense to give them the job to help them bootstrapping their company.

So what you're suggesting is to take the installer course and then hire one of your classmates.

Re: The price of solar power just fell 50% in 16 months

#257

Post by narag »

jackcosgrove wrote: post #233
coryfklein wrote: post #215

Earlier quoted context omitted.

> And that is why it is a huge problem for the power companies It is a problem, but not necessarily in the way you may be thinking. Peak residential power usage is in the evening when solar isn't available. Power companies therefore end up spinning down coal and natural gas during peak solar, then just spinning them back up again as the sun begins to set. [1] So you haven't replaced the coal and natural gas plants, y…

I would propose a global power grid as a solution to this problem, on which the sun would never set. The only problem is that earth is not set up well for this: the Sahara would be the solar workhorse of the planet, and the consumer of all this power would be Hawaii.

Panels islands.

Re: The price of solar power just fell 50% in 16 months

#258

Post by criddell »

dragontamer wrote: post #252
criddell wrote: post #249

Earlier quoted context omitted.

I'm not sure what you mean by 100% of the costs will be covered . All I know is that I can reduce the amount of electricity that I buy during the day when I consume the most. The savings are greater than the cost so it's pretty much a no-brainer for me at this point. If I finance, I can pretty pay for the system with the money that I'm no longer using to buy electricity. > when the subsidies run out Why stop subsidiz…

I think that net-metering is going to go away once solar adoption reaches a certain critical mass. You can't keep giving away free batteries to consumers, someone eventually will need to pay for those batteries. Other solar subsidies may remain a bit longer. But net-metering is probably the biggest once. > I'm not sure what you mean by 100% of the costs will be covered. All I know is that I can reduce the amount of e…

I'm not sure that the net metering argument applies to places like central Texas. People consume the most power when the sun is shining so solar, even without net metering, makes sense. Of course other regions are different.

> Utility scale solar seems to be the best solution

I don't think it makes sense to talk about a best solution. Large scale solar will contribute along with nuclear, coal, natural gas, wind, etc...

Re: The price of solar power just fell 50% in 16 months

#259

Post by coryfklein »

amenghra wrote: post #236
S_A_P wrote: post #229

Earlier quoted context omitted.

Can validate. The problem with electricity is that there is no large scale storage like there is for other forms of energy like NG and Crude. Until someone comes along and figures out how to store electricity, this will continue to cause grief to power companies. Power plants are really just options, if the price per kWh is at a certain point then it makes sense to spin up or take down a plant and generate power. Add…

Some countries store energy by pumping water up a dam. Seems efficient.

Whoa! That sounds really cool so I looked it up. It's called "Pumped-storage hydroelectricity"

https://en.wikipedia.org/wiki/Pumped-storage_hydroelectricit...

Re: The price of solar power just fell 50% in 16 months

#260

Post by kragen »

schwabacher wrote: post #230
kragen wrote: post #194

Earlier quoted context omitted.

3% is an estimate of the rate of economic growth: http://www.tradingeconomics.com/united-states/gdp-growth As I said above, we should expect the market's long-run returns to be close to the rate of economic growth. It's true that stocks in the US in the 20th century dramatically outperformed that 3%. This is for three reasons: first, up to about 1975, the world's economic growth rate was higher than 3%, due to the Se…

I'm not an expert here, but doesn't it make sense for stocks to return higher than growth because of earnings? For example imagine I own stocks making up 1% of in a company w/ earnings of $X, and market cap of 10 * $X. If the companies growth over a year is 3%, at the beginning of the year my stocks should be worth 0.01 * $X and at the end of the year 1.03 * 0.01 * $X due to the growth, BUT shouldn't i also have rece…

If the company's value increases by 4% over the year, and it pays out one of those four percentage points as a dividend and reinvests the other three, you get the scenario you're talking about. (And it doesn't matter how much of that 4% is revenue minus cost of sales and how much is, say, increase in value of its holdings in another company or real estate.) But if the economy grew by 3% and the company's value increased by 4%, your company is doing better than the economy as a whole, and it's because someone else is doing worse. In the US over the last 40 years, a very significant "someone else" here has been the employees — as they have lost bargaining power, they have gotten worse bargains.

It seems like maybe you're saying that the revenues, and therefore the profits, don't count here because they're not part of economic growth, but just part of the ongoing economic activity. But what determines the P/E ratio, which is to say the return on capital (as a reciprocal), across the market? What keeps investors from bidding the market cap of the company up from ten times earnings to a hundred, a thousand, or ten thousand times earnings? It's the availability of other investments that they expect to grow in value at a higher (risk-adjusted) rate. If you can get a 16% annual return on your investment by buying solar panels instead of stocks, then the guy who does that will have 16% more money to invest in more solar panels every year, until either he bids the price of solar panels up (due to limited manufacturing capacity) or he bids the price of electricity down (due to limited transmission grids or electrical demand). The first of those is already happening; the second one should start happening in about 2024, earlier in some areas.

Now, you could argue that there's a difference between this solar panel maniac guy spending 16% of his capital base in solar panels every year, accumulating more and more solar panels and selling the electricity from them to buy more, and GDP growth, because the solar panel maniac is accumulating a stock, while what the GDP measures is a flow.

But note that by the hypothesis that the maniac is investing to get some relatively inflexible percentage return on his investment, he receives a flow of earnings that is proportional to that investment. And that flow is part of the GDP.

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