Sucker Purchase: Solar Panels On The Roof

In case you hadn't heard, Berkeley took only 9 minutes to fill up the slots for its "innovative" program to pay for rooftop solar installations over time using property taxes.

Proponents lauded this measure, which passed handily, for allowing the average homeowner to pay the hefty $28,000 pricetag for a typical system by tacking on only $182 a month to his property tax bill.

On the surface, this seems like a good deal, and some have even suggested that it could be a model nationwide. Sadly, not only is it a bad deal, it's an environmental disaster.



Now I know you're probably expecting me to attack solar panels from the typical conservative non-environmental perspective. After all, rooftop solar panel installations are a key element of reducing greenhouse gas emissions and saving the planet, right?

Not so fast. I realize that the typical liberal narrative is that the only reason solar panels are not ubiquitous is that greedy capitalists are unwilling to foot the bill to purchase them. Instead, they'd rather pay 10 cents a kilowatt-hour or so for dirty coal power. If only they were willing to cut back a little up front, they'd get 30 years or so of emission and cost-free solar power from each panel they purchased!

Here's the problem. No one ever asks why solar panels cost so much more to produce per lifetime kilowatt-hour than do coal-fired power plants.

Well, let's think about it. First, someone has to locate and purify a certain type of silicon. Then, an industrial process must be used to produce a large crystal structure from that silicon material. Finally, since many of the panels produced don't measure up to quality standards, relatively few make it through the process.

What's the common denominator at each step of this process? Energy. It turns out that solar panels require a vast amount of energy to produce -- starting with the bulldozer digging up the silicon, through the energy required to purify it, the energy to produce the crystal and then the wasted energy when panels fail to operate.

So, when you pay $28,000 for a solar panel, most of that money is going to purchase fossil fuels which are burned to produce the energy for making that panel.

When you think about it, this is true for pretty much all alternative energy schemes (with a few exceptions, such as hydroelectric and geothermal). Any time you're relying on a complicated and expensive device to generate your power, it's a good bet that the cost of that device is largely energy-related. So, if the device costs more than the cost of the energy it "saves" you, you're probably wasting energy.

In other words, unless you get $28,000 of energy out of your solar panel, you've probably hurt the environment. Unfortunately, that takes at least 10 or 15 years to do, even with optimistic assumptions about energy production. And, this all assumes your panels don't break.

Oops.

What rooftop solar panels really amount to is a bet against future technological progress. What you're saying is, "I'd rather burn up $28,000 worth of fossil fuels right now than burn them slowly over time in the hope that things get more efficient into the future."

Also, you're saying you don't think technological progress is likely to produce solar panels more efficiently in the future.

Doesn't make a lot of sense, does it?

The real solution to our energy dilemma is to search for cost effective alternative sources of energy. Cost effectiveness is absolutely critical, because if something makes financial sense it's a good bet that you're getting more energy out of it than you put in. And this should be the gold standard for environmentalists.

Environmentalists need to start thinking like capitalists. A capitalist looks at an investment and asks, "What return on investment can I expect here?" An environmentalist should look at a new energy technology and ask, "What return on energy does this technology give me?" So, if the device costs 1 million kilowatt-hours to build, it better generate far more than 1 million kilowatt-hours over its lifetime.

In my opinion, if you want to save the planet using solar power, you should encourage the government to fund basic research, or throw some money into one of the many nanotechnology-based solar startups throughout the Bay Area. Both of these avenues make sense, because they can potentially find ways to produce solar panels for a fraction of the cost (and therefore energy) required to produce today's panels.

But the worst thing you can do is purchase today's inefficient environmentally unfriendly solar panels.

Let's hope Berkeley's program doesn't become a model for the nation. If it does, we're in for a world of hurt.