I think we are about to slide down a slippery slope with Feed In Tariffs.

Germany and other European nations are using public fundinig to build power plants, that the public doesn't own. Germans pay 4X for electricity than we do, as a result.

Essentially, your electric bill would include a tariff (fee or tax), in which you pay toward the building of a new plant, but you aren't given any share of it - no ownership. The power company or the government would own it.

If the government owned it, then it would be blatant communism, as they set market prices (which I suspect would be different for different people - rich pay more, poor pay less). If the power company owns it, then it is simple theft.

Today, those with the capital to build power plants seek out the best marketible solutions, develop a viable business model, and establish longterm contracts with the power companies. Competition among builders keeps the costs to the power companies low.

Nanosolar, seeing the American market, targeted a solar panel design that was "cheaper than coal" to fabricate, install and operate. Currently, they are selling into the fat German market, because consumers are forced to pay these tariffs. Without the tariffs, power companies would be driven to buy Nanosolar panel power plants from capitalists, who would be offering electricity cheaper than coal.

Forgot to add a link:

http://www.renewableenergyworld.com/rea/news/story?id=51798

"I'm from the government, and I'm here to help..."
is right up there with "Of COURSE I'll respect you in the morning..

Tagamet,

In California, they created a similar set-up, in which the rate they charged customers for their power was a percent of operating costs, so they started buying gold plated relays, and the most expensive equipment possible, so that they increased revenues.

Currently, various firms, which have the capital to build their own plants and sell power to the utilities, competitavely bid to build these plants, keeping the price for consumers low. These companies then implement new / better tech to further reduce their own costs, to increase their profits. For the next bid, they offer even lower prices, to stay ahead of competition, based on that new tech.

I had brothers who worked at a water plant, where they would use solid brass piping for the same reasons as the Feed In Tariff approach, so it is the consumers who get gouged.

I think your reasoning is somewhat flawed.

Why would anyone pay more on the front end for contruction, no matter what the backend revenue is promised to be. If you can cut your costs, you make more money.

The less they spend on construction, the more money they make. Period, end of story, try again. All the FIT does is provide an assured price if they generate electricity. It's like saying, if you make it, we will buy it for X period of years. This allows speculators to create plants without having to worry about a collapse in energy prices (yeah, that is the least of our worries). By protecting investment, you encourage people to invest now.

From the sounds of the article, it doesn't look to be more of an investment then our current tax breaks and credits for alternative energy. It's just making it a simpler system.

As to your point about the government getting involved in energy companies...Ever hear of the Bonneville Power Company or the Tennessee Valley Authority. We have a long history of public support for creating power plants that later co-operate with private industry to sell us our electricty. The line has long blurred between private and public for that sector. I'm not sure how much milage you can get painting another boogey man of the government there.

Why guarentee a high price for energy, when you can have several companies bid to provide power at the lowest price? Why would you guarentee someone else's expense, since it is the customer that pays?

Simple isn't always better, esecially when you are creating a system that hurts consumers, making them pay for new plants they don't own for the government to run inefficiently. You are right that the TVA and others are federally owned / controlled behemoths with sub-contractors, but we now have private enterprises that could compete to achieve a better result, so why involve the government at all?

If we had the private industry with its "cheaper then coal" solutions as you say, then we wouldn't need the government. But I stopped waiting for Santa Claus a long time ago as well. Fairy tales and boogey men aren't going to get us out of this energy crunch. Public and private secters working together might.

We could compromise and say that the Gov't might help provide seed money for NEW technology... oops, that means that the govt has a clue and works (as in efficiently) in the public's best interest. Sorry, scratch that. Well, I guess they DID put a lot of funding in hydrogen fuel cells....

Jason, I'm sorry, but I thought your post said that it's CALIF that has a reasonable law now. Musta mis-read that part. (just kiddin)
Back in the TVA days, that project was bleeding edge tech and so mamouth (in terms of THOSE dollars) that no company could have mounted that size endeavor.
No boogey men, just (I suspect) a little more mileage on the old odometer.

The TVA was a federal program to provide work for people in an area that was really hit hard by the Great Depression. Although controversial, it was decided that it was needed at that time, and the private sector could never have been able to do it, becuase the TVA was also given eminent domain powers to move families and take land needed for development.

The end result of being in the electric business was just a by product of those programs.

What is nice when you are a regulator as well as a supplier, is that there are federal laws in place to prevent competition with the TVA.

So it is really hard to compare anything with the TVA, as it was a one time massive federal works project, that I doubt will ever be repeated.

Feed in tariffs, rebates, tax cuts, military project funding, carbon tax, subsidies, donations, etc. Let's just get as much money to these green technologies as possible. The more green tech we develop the better off we will be globally when the market for green technology grows exponentially. Some of you are saying, "no it won't". Really? Can anyone come up with good argument as to why the green energy market will remain small in the coming decades? The more international patents we can get the better. It's a race and I already heard the gun go off.

Also, some of you argue that current green technology can't compete with fossil fuels. Exactly! How could a new technology possibly compete with the entrenched oil infrastructure and the use of a non-renewable "one time free offer" resource? How about we get serious and start talking about the best renewable sources of energy moving forward. Most of us seem to be in a rut on this.

blakec and Texas,

The article that I linked gave a great analogy to FIT's and the current private capital approaches. It is like running a 0-60 race in second gear, you might be slightly ahead at 30 mph, but it won't get you to 60 mph. You would be fostering a system, that once established, becomes entrenched with state / federal protections that no private industry has. NO government should EVER have a direct source of income, and NO business should EVER have its own military. When those two things mix, it leads to greed and oppression - Russia, Venezuela, etc..

Moreover, tech would be aimed to feed the FIT system, not an eventual free market system. Nanosolar would never have been conceived and created, if a business could sell current tech at 4X the rate of coal, as happened in Germany.

If you want more innovation to produce a free market system for low costs to power purchasers, big and small, then stop taxing those businesses to death. You may continue to tax coal and petroleum at current rates, but let tech companies lure needed capital.

Funny you used the Nanosolar example with Germany. Did you know where Nanosolar's first 18 months of panels are going? Yep, Germany. Why? Because they can get the most revenue to help pay off the incredible amount of capital it took to get them this far. So, your argument that companies will not innovate is wrong because the more they innovate the more profits they get. The more profits they earn the more they can dump into R&D. Also, don't get so crazy over government owned companies or companies having militaries. You can always privatize when it makes sense and everyone knows that it's not hard to compete against a government owned entity.

So, I guess the question is: Should the government step in and help things get going in a big way. I say yes! Our energy problems are just too big and bold with too much risk to let this rest on a few companies. We need a huge country-wide effort. Now.

Funny you used the Nanosolar example with Germany. Did you know where Nanosolar's first 18 months of panels are going? Yep, Germany. Why? Because they can get the most revenue to help pay off the incredible amount of capital it took to get them this far. So, your argument that companies will not innovate is wrong because the more they innovate the more profits they get. The more profits they earn the more they can dump into R&D. Also, don't get so crazy over government owned companies or companies having militaries. You can always privatize when it makes sense and everyone knows that it's not hard to compete against a government owned entity.

Texas, yes, I knew Nanosolar was selling in Germany, but they designed a product targeted for the American market. If Germans are dumb enough to pay 4X for something, then Nanosolar should take their money from them, but make no mistake, the product was targeted for the American market. The Germans developed an industry around expensive silicon on glass panels as a result of the promised 4X revenue, so whose system drives the innovations targeted to deliver consumers the best price?

Texas, yes, I knew Nanosolar was selling in Germany, but they designed a product targeted for the American market. If Germans are dumb enough to pay 4X for something, then Nanosolar should take their money from them, but make no mistake, the product was targeted for the American market. The Germans developed an industry around expensive silicon on glass panels as a result of the promised 4X revenue, so whose system drives the innovations targeted to deliver consumers the best price?

So, by your own admission, Germany has engauged in the very policy that you advocate against. And because of it, they are kicking our butt when it comes to installing cheap solar cells. Well, gee, I totally see your point, I hope we don't make that our policy. I hate things that work. </snark>

So, by your own admission, Germany has engauged in the very policy that you advocate against. And because of it, they are kicking our butt when it comes to installing cheap solar cells. Well, gee, I totally see your point, I hope we don't make that our policy. I hate things that work. </snark>

WRONG!

ABSOLUTELY WRONG! German solar panels are NOT cheap.

German industry produces solar panels that generate power at 4X that of coal. NANOSOLAR created solar panels that generate power CHEAPER than coal, because they were designing for the American market. Nanosolar is simply exploiting the German markets high guarenteed energy prices to make huge profits. If the Germans were smart, they would rewrite their laws to force the industry to buy Nanosolar powers and pay them CHEAPER rates.

Late me state it more clearly, if you create a market for renewable energy that pays 4X the price of coal power, then your industry will develop products that serve a 4X market. You need only create a tax free market to produce renewable energy at a price equivalent or cheaper than coal to get industry to deliver exactly that.

You need only create a tax free market to produce renewable energy at a price equivalent or cheaper than coal to get industry to deliver exactly that.

And then we will live in a land of candy cane houses and fairies will deliver our morning paper wrapped in $100 bills.

Your arguement reminds me of the fictional book "How to make a million dollars tax free"

Page 1 "First get a million dollars. Second..."

Obviously the past 60 years of free market policy for alternative energy has not worked. Some one comes up with a plan, a plan that in fact is working in other parts of the world, and all you can do is dump on it. How sad.

And then we will live in a land of candy cane houses and fairies will deliver our morning paper wrapped in $100 bills.

Your arguement reminds me of the fictional book "How to make a million dollars tax free"

Page 1 "First get a million dollars. Second..."

Obviously the past 60 years of free market policy for alternative energy has not worked. Some one comes up with a plan, a plan that in fact is working in other parts of the world, and all you can do is dump on it. How sad.

I'll give you two examples:

1) Nanosolar has created solar panels that costs 1/3 that of coal to fab, install and operate.

2) Nevada Solar One used decades long financing to amortize the installation costs of their thermal solar plant to the point where the electricity only costs 9 - 13 cents per kW, while current rates are 9.59 cents per kW. Worst case, it is only a 36% premium over current rates, best case, it's a wash.

No fairytale here, look it up, punk.

I'm sorry Jason but I have to agree with the other poster. Your logic just doesn't make sense to me. If a company says they will give you 4 dollars for a given amount of energy and guarantees that for 5 years then the first thing I do is look around to see what I can use to make it work.

<the following are the thoughts of one of the first companies that got going in Germany>

"Hummm, even if I use current solar technology I can make enough money to start a company, go through the long learning curve, the government regulations, other hassles."

<time passes>

"Man, that was difficult but now I'm up to speed and have some good experience. However, there are more and more companies coming in and I better do something about that. I need to make more money so I can keep ahead of the curve. Hey, that new company is America, what are they called... Oh yeah, Nanosolar. If I can get cheaper panels, cheaper inverter technology, cheaper wiring, aluminum, etc. I can cut down on my material cost and make more money. I can then use that money to start more projects, do more R&D and gain more market share...."

Do you get the point Jason? The cheaper the cost of materials for the service provider the more money they make. Do you think Germany is so stupid as to allow the use of older technology when newer technology exists? Do I have to remind you again where Nanosolar's new panels are being installed, even as I write this? Can we end this specific debate?

Do you get the point Jason? The cheaper the cost of materials for the service provider the more money they make. Do you think Germany is so stupid as to allow the use of older technology when newer technology exists? Do I have to remind you again where Nanosolar's new panels are being installed, even as I write this? Can we end this specific debate?

I must have missed this reply, as I would have stepped on your neck had I only known you had posted it.

You have totally rewritten the history of FIT's in Germany. Germany set electricity prices 4X higher than they should have been, and built out a silicon solar panel industry that produces energy at 4X what they should be. A clever capitalist in America said, Gee, those Germans sure are stupid, because I've created a thin film tech that competes directly with coal, so I will set up shop in German, and take all their money, then sell in America later, after Germany has been fleeced.

Germany finally saw the error of their ways, and is slowly dropping their FIT rates to stop the continued build-out of expensive solar panel capacity, and allow the cheaper tech to build out instead.