Solar Future Suddenly Cloudy

By Richard Martin, 11-16-07

Coal up, solar down – that’s the message from the markets and the media this week, as solar-power companies face a possible expiration of the tax credits for solar investments, while coal producers and coal plants continue to boom despite the looming threat of carbon-emissions caps.

The Solar Energy Industries Association posted an alert on its Web site citing “widespread reports” that the long-awaited energy bill being laboriously squeezed through Congress will not include a measure to extend the Solar Investment Tax Credits, which give commercial solar-power system owners tax relief equal to 30% of total system costs. If the credits aren’t extended it could slow the adoption of solar generation by utilities, according analyst Stephen Chin at investment firm UBS.

The news hit the stocks of publicly traded solar power companies hard this week.

Meanwhile The Economist reports that for all the news about states in the U.S. delaying or canceling the construction of new coal-fired plants, coal is still king (Sub. req.) in much of the world. “Utilities in both [the U.S. and Western Europe] are running their coal-fired plants at full throttle, have several new ones under construction and would like to build even more,” the influential British newsweekly reports, while China is reputed to bring a new coal plant online every week. In the developed world, the lower price-per-watt of coal more than outweighs any possible future premium for carbon emissions.

“In America, more coal-fired generation is being built than at any time in the past seven years, despite the threat of emissions caps, according to the Department of Energy,” the story continues.

Meanwhile the Center for Global Development released a study showing that while American remains the largest emitter of climate-changing CO2, it is rapidly being overtaken by the rapidly growing economies of China and India. “A single Southern Co. plant in Juliette, Ga., emits more annually than Brazil’s entire power sector,” writes Juliet Eilperin of The Washington Post.

In other energy news:

-- Those three handsome fellows in the new nationwide TV ads that, starting next week, will plug the energy policy legislation? Those are Western governors Schwarzenegger (Calif.), Huntsman (Utah), and Schweitzer (Montana). Sponsored by Environmental Defense, the TV spots will highlight the unfortunate fact that, while governments at the state level have taken significant action to reduce carbon emissions, the federal government has been inactive. “Now it’s their turn,” Schwarzenegger tells The New York Times.

-- Once upon a time, “micro-hydro” – small-scale electricity generating projects using hydro power – was seen as a local, next-generation fix for America’s energy needs. Government regulation and the resistance of big utilities mostly killed that promise, but micro-hydro could be making a comeback in the Roaring Fork Valley. Bruce FaBrizio, the founder and CEO of Simple Green, which produces nontoxic, biodegradable cleaning products, is attempting to build a mini-hydroelectric plant on the Brush Creek on his property outside Aspen. “This is a dream I’ve had for 30 years,” FaBrizio tells the Aspen Times.

-- Just as tortuous as the progress of energy legislation through the U.S. Congress is the effort to re-distribute the millions of dollars in revenue from oil and gas production flowing into the Colorado treasury. Even given extra time, the interim committee in the state legislature charged with hashing out a compromise on how it spends burgeoning lease and tax revenues won’t meet its latest deadline. Municipal and local governments say that the lawmakers are going about it all wrong: the money should go first to benefit local communities affected by oil and gas drilling, Aron Diaz, executive director of the Associated Governments of Northwest Colorado, tells the Grand Junction Sentinel, before being spread around at the state level.