South Australia adopts NZ Green Party policy
After a week of intense negotiation, South Australia became the first state in Australia to introduce feed-in tariffs, with the passing of landmark legislation. The feed-in tariff offers 44 cents (twice the retail electricity rate) for every kilowatt hour of electricity which is fed back into the grid from solar PV systems. Greens MLC Mark Parnell’s proposed amendments – to extend from 5 to 20 years and include small business and others (churches, schools, etc) up to 160MWh/annum – were finally accepted by the government and the Bill passed on Thursday 14th February. (ATA e-bulletin 27 Feb)
The NZ Greens have long had a policy in support of feed-in tariffs to help smooth the transition to renewables without requiring government subsidies. See section 5 of our Energy Policy.
Unfortunately, there is resistance within this government to the idea of feed-in tariffs. I would argue that the sooner this country makes the switch to renewables, the more safe and secure our communities become, so why wait? It’s not like it requires any government money. Nevertheless, we should be putting the mechanisms in place that would allow us to go this route when photovoltaic (PV) prices begin to fall.
Right now there is strong international demand keeping prices from dropping. This is in part due to the wide success of feed-in tariffs around the world. As usual NZ is lagging behind the world in fostering energy independence. However, several big companies have plans on the table to build individual thin-film factories that alone exceed the world’s current PV production. That sort of supply should force prices down in just a few short years.
For more, see this story in the Adelaide Advertiser
February 28th, 2008 at 1:08 pm
Great stuff. Technical innovation and the gradual incorporation of energy-producing films into building shells and roofs is unquestionably a Good Thang. Now if the power companies were to finance and lease-back the household generation, that would complete the loop. Roll on Nanosolar, Miasole and all the rest…
February 28th, 2008 at 8:31 pm
My understanding was that current solar devices use more energy in their making than they will generate over their productive life. Has that changed? If not, why on earth would you want to subsidise such an inefficient use of fossil fuel?
Also, given they none of these devices generate power at prices that even approach that of fossil fuels, isn’t it the case that only the rich will be able to splash out on these expensive systems? And you then expect the rest of us - the poor bloomin workers - to subsiside their purchases through higher fuel bills?
No thank you.
February 28th, 2008 at 9:15 pm
I wouldn’t support feed-in tariffs for electricity generated from solar panels on people’s houses, for the reasons Mouldwarp described.
But I do support them as part of a support package for developing technology in wave and tidal power generation. There is great potential for those technologies, and there would be value to the new Zealand economy to have the technology developed here, with the patents and the expertise held by New Zealand companies (the Danes did something similar with wind power).
Are you sure the Green policy was intended to encourage things like solar cells on people’s roofs?
February 28th, 2008 at 9:17 pm
Who pays this rather large feed in tariff? The power company? I believe they have something similar in Germany, where it has worked very well…
Can’t comment on your first paragraph Mouldwarp, except if say, a country like NZ made solar panels with our high rate of renewable electricity use there wouldn’t be very much fossil fuel used! A lot of renewable projects in the pipeline I believe.
You obviously don’t share the optimism about solar power getting cheaper any time in the next few years? Under ‘cheap solar power’ in Google there was a Daily Telegraph article that contained the quote:
(token indictment of nuclear power there)
and
Industry hubris maybe, but no denying that it is one technology that is galloping ahead, so perhaps we should be ”putting the mechanisms in place”, whatever that means frog??? Isn’t there a subsidy for those who want to install solar in their home anyway, so the rich would be subsidising us poor workers Mouldwarp?
February 28th, 2008 at 9:47 pm
They appear to only get the 44 cents per unit if they have a net surplus of power overall. They don’t get paid for every unit they produce. Only those units in excess of what they may have consumed from the grid. I wonder why solar PV only? A very modest wind turbine could produce more power then more expensive panels….though not as consistently at any given moment.
February 28th, 2008 at 10:19 pm
Mouldwarp and Kahikatea,
Have a look at this British newspaper article:
http://www.guardian.co.uk/environment/2006/sep/11/energy.business
It states that the energy used to construct a solar panel can be recouped in two or three years, and panels are often guaranteed for 25 years (so presumably last at least this long).
Secondly, the claim that the cost of solar electricity is more expensive than electricity generated using fossil fuels is only partly true. In many developing countries, solar power is actually cheaper than fossil fuel generated electricity. I have a friend who calculated solar panels would pay themselves off in about 8 years in Tonga, where most electricity is generated using diesel generators, and is very expensive.
It sometimes pays do do a bit of research before you open your mouth.
February 29th, 2008 at 12:46 am
Mouldwarp,
What you have heard may have been true 40 years ago but isn’t true today. A quick Google search found these two photovoltaic life cycle studies, one for energy, one for a range of environmental impacts.
http://www.esu-services.ch/download/jungbluth-2005-LCA-PV-PIP.pdf
http://www.energybulletin.net/17219.html
The simplest and cheapest way to double the economic efficiency of rooftop pv installations is to capture the waste heat and use it to either heat or ventilate the building.
February 29th, 2008 at 6:50 am
Mouldwarp
Check out the nanosolar link that Waymad provides. The nanosolar film is competitive on cost per KW with coal extraction. Things have been changing really fast in this area. Lots of demand, lots of money, some government stimulation of the field and therefore, lots of research and development and engineering work.
BJ
February 29th, 2008 at 8:27 am
Be aware that even though the home-owner does not get paid for the power they use, it is offsetting their power bill at the retail rate. Currently, in NZ, you can only be paid the wholesale price of the juice, (not the lines charge bit either). This makes the economics stack up nicely for the Aussie home-owner.
As for who pays the subsidy, well everyone does, without the government having to interfere. When your gentailer pays you the 44 cents per kWh, that gets folded into the levelised cost of power for everyone. In essence, the more power you use from the grid the more of the solar subsidy you pay. It’s impact on prices in Germany, where the scheme has been going for years, is pretty minimal.
February 29th, 2008 at 10:33 am
“The NZ Greens have long had a policy in support of feed-in tariffs to help smooth the transition to renewables without requiring government subsidies.”
Well what the hell is forcing payment at twice the delivered retail rate if not a subsidy? It’s very easy to say there is ‘minimal’ impact on prices when everyone else is paying the bill.
Samuela
The problem with PV technology in the islands is the degradation they suffer in marine environments and the lack of technical support on island.
February 29th, 2008 at 10:45 am
Care to reference that ‘degradation’ thing insider? I spent most of 2006 studying renewable energy in small islands (at hons level) esp. the Pacific and ‘marine environment degradation’ was never mentioned anywhere! What I do know is that diesel generators have a lot more parts that need fixing/replacing a lot more often, which for isolated countries like them is very expensive, not to mention the cost of importing diesel, not just to the main islands, but to all the hundreds of islands surrounding them, where the cost gets even higher!
Like with anything, people can be trained in maintenance, just as long as it isn’t say, the men who bugger off to do seasonal work for half the year.
February 29th, 2008 at 11:07 am
Insider - I was referring to taxpayer subsidies via the govt. Obviously, a feed-in tariff is a form of subsidy! It just skips the bureaucracy bit and does it through a low cost market mechanism.
Having personally designed, installed and maintained solar PV in third world marine settings, I can assure you that the degradation issue is a myth and that training local staff to maintain solar is often much easier than keeping the diesels going. The fly in the ointment is the capital cost of battery replacement after about 5-7 years, which is the downfall of such systems once the good natured donors have buggered off to their next project. For my last project, I worked out a system of more frequent replacement with locally available, cheap and nasty lead acid batteries. So far so good, after a couple of replacement cycles. Clearly I am no longer there, but the agency still is and so far so good.
Technical support can be an issue in some settings with no infrastructure, but there have been some fascinating successes even in such circumstances, when training and new industry support was part of the donor’s package.
February 29th, 2008 at 11:19 am
Samuella: “Well what the hell is forcing payment at twice the delivered retail rate if not a subsidy? It’s very easy to say there is ‘minimal’ impact on prices when everyone else is paying the bill.“
Maybe it reflects some value for not having to build new, more expensive production capacity. If the population keeps rising an the demand keeps growing, investment in widely distributed micro alternatve power sources may be the best thing in the long run. So a subsidy may not be a subsidy, but may instead be someting resembling the new marginal cost of the next unit of power generated by other, less destructive means. All in how one choses to see it, I guess.
February 29th, 2008 at 12:15 pm
Another good thread, although perhaps somewhat fixated on the price-per specifics of one state in Oz. The world-wide picture on solar PV is one of rampant development:
- our own Massey has an organic PV under research
- CIGS is the main technology used by Nanosolar, Heliovolt, Miasole, and a host of others. These companies are producing the stuff as we speak. It’s not techo-vapour.
- distributed generation cuts right down on several externalities: new transmission lines, new power stations; and increases local and community resilience.
This last is not to be sniffed at: if a $5 D-shackle can cut power to a chunk of Auckland for hours, imagine what an intentional attack or a decent quake could do. NZ is a very long, thin country, and its vulnerabilities are simply massive.
Increasing localised generation should shurely be a Green policy aim. Think global (in terms of technology choice), act local.
February 29th, 2008 at 3:03 pm
Three companies are currently accepting consumer generated electricity. The one that stands out for me, for the duration of their offer, is Meridian who have undertaken to purchase at the same price you pay them, Doesn’t get around the daily line charge but is a huge step in the right direction.
February 29th, 2008 at 3:41 pm
Care to provide a link Scott? I can’t seem to find one.
February 29th, 2008 at 6:54 pm
samiuela,
Thankyou for the link. This is an important issue which deserves more discussion, but it has been whipped off the blog front page by dross about frogs.
February 29th, 2008 at 8:01 pm
Given that the feed-in tariff will apply when domestic consumers have surplus power and therefore won’t be applied when the power demand peaks (which is largely caused by a peak in domestic consumption plus lighting), Meridian’s offer is very generous. The power companies still have to build generation to cope with that peak, and the transmission lines still have to handle it too, so solar power doesn’t solve those problems.
The situation in Australia is quite a bit different to that in New Zealand, due in part to greater use of air conditioners for cooling. They also use predominantly coal-fired generation, so any power fed in to their grid saves coal, pretty much independent of when it is fed it. In New Zealand, there are times when Transpower practically can’t give electricity away.
Don’t expect any feed-in tariff in New Zealand to get close to this Australian offer.
Having said that, Meridian’s offer (if confirmed) is a great step forward.
Trevor.
February 29th, 2008 at 11:12 pm
Mouldwarp: One person’s tea is another’s coffee. I know biology majors who would be far more interested in frogs than in solar panels.
I agree thought that this does highlight another area in which New Zealand could really improve its energy legislation. Keep on pushing the good policies on energy, Greens!
February 29th, 2008 at 11:28 pm
The problem I can see with solar panels is the initial cost. They may well recover their cost over 15 or 20 years, but if you can’t afford to buy them in the first place, its a bit academic.
The reality, is that most of the world’s population will not be able to afford PV panels, even if the cost came down by a factor of 10 (I’m serious). At present, it costs over $10000 to equip an average house with solar panels. Even at $1000, people in developing countries are not going to be able to afford the initial outlay.
What is needed is some inovative way to make the installation costs affordable.
March 1st, 2008 at 2:59 am
Frog pointed out that “Currently, in NZ, you can only be paid the wholesale price of the juice, (not the lines charge bit either).”
The very situation LAQC was designed for. Am I right or am I right?
March 3rd, 2008 at 11:05 am
samiuela: Solar PV being a semiconductor tecnology, follows Moores Law: costs halve or capabilities double every 12 months. Current US manufacturers are aiming for $USD0.50/watt as a bare-panel price. That’s 10% of the current cost.
You are IMHO thinking too narrowly on two points:
1 - letting the perfect get in the way of the good. Ferget the world population. Act Local. Solar is a good thing from several POV’s: it decentralises generation, end-runs the otherwise rancourous debate about haram and halal appliances (if you can generate the juice, why not have the electrical equivalent of a Humvee?), and privatises presently social costs of generation such as wild viewscapes (windfarms), wild rivers (hydro), Gaia’s body temperature (geothermal) and the relic of the 5000 ppm CO2 levels of yore (coal).
2 - not thinking about the capacity of private sector marketing and financing to get that good deal. Hell, if a gormless car hoon can put down $1 and drive away in his Nissan Skyline, it should be possible even for the calcified bureaucracies of State generators to devise a pay-as-you-go scheme. You’re assuming a self-funded private-person approach. Stand in a central generator’s shoes for a second - if you cannot build new capacity because of NIMBY’s, the RMA, a wallowing Gummint and a raging mass delusion over AGW, then, suddenly, financing thousands of homeowners into their very own personal generator does have some sudden appeal as a new business model, no?
March 3rd, 2008 at 11:41 am
On this web page is some data on retail price of PV modules over about the last five years. During that entire period the USD price per watt (peak) has always begun with a 4. Doesn’t look much like Moores Law in action to me.
March 3rd, 2008 at 5:20 pm
Foller this link, read the harticle (tip: Instapundit), and be hedumicated, Buckles.
March 3rd, 2008 at 7:59 pm
If you are going to quote Moore’s Law, get it right. It is double the capacity every 2 years, not 12 months.
Moore’s law is not necessarily applicable to solar cells. It was originally used to describe transistors, where reduced feature size directly increased capabilities and therefore reduces costs. Solar panels need area, so reducing feature size doesn’t help (or if it does help, it doesn’t help as much as when making arrays of transistors).
Solar panel prices will fall, but I doubt that it will be by a factor of 2 every 2 years.
Trevor.
March 3rd, 2008 at 8:58 pm
Thx for your instruction, Trev. I prefer the original formulation from ol’ T J Rodgers hisself - the guy who owns Sunpower - he did, after all, invent the VMOS chip fab process: if he thinks Moore is in play, and is producing panels while holding that belief as we speak, that’ll do it for me. Pro experience over amateur opinion, really.
And the point about PV pricing, esoterica aside, is that there are multiple, competing technologies in play, well funded, and just at the start of their S-curves. All of Nanosolar’s output is contracted to Germany for 2008, for example, and several of the other roll-to-roll thin-film players haven’t actually turned on the presses yet. So we are in the ‘eagerly anticipating’ phase, here at the other end of the world. But there are a couple of predictions that are no-brainers about this whole business:
1 - production capablility already announced runs to gigawatts per year, and more players are joining the gold rush. There will be much scope for local dealerships, franchises, JV’s and other distribution modes. SunPower, for instance, sells only in 25+ subdivision house lots. There’s scale to burn.
2 - in NZ’s funky little economy, with new large-scale generation made practically impossible, the more-aware power companies will be looking at this and other distributed generation modes, as their mainstream business model.
Ain’t nanotechnology wunnerful?
March 3rd, 2008 at 10:53 pm
http://www.nanosolar.com/cache/edn.htm
March 4th, 2008 at 1:51 am
Maybe y’all need to relax, sit a spell, take ya shoes off
http://www.nasa.gov/externalflash/nasacity/index.htm
y’all come back now, ya hear?