Berkeley Professor Questions Residential Solar

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Ronna Kelly from Berkeley's Haas School of Business published an article two days ago outlining concerns about residential solar energy creation. A study by the Haas School of Business, the UC Energy Institute, and Severin Borenstein found that the costs of traditional Photo Voltaic solar panels outweighs the benefits (including reduction of greenhouse gas) and are thus less efficient than putting a delay on residential solar expansion. Instead, it is recommended that more research be done to develop better solar technology. This research would be done through funding by the state that would be shifted away from commercial production (as subsidies for residential solar are cut to cover research costs).

This is a very interesting and controversial argument as some of the most spectacular breakthroughs in solar energy generation have been produced by commercial firms such as Nanosolar. Nanosolar isn't focusing it's product on residential installations at this point so the impact of cut subsidies might not reach them, but it would certainly stifle other developments and commercialization of technology has historically produced the fastest results as economies of scale are reached. It's the same reason that the United States often outpaces the rest of the world in medical technology developments - the US commercializes them. I'm no fan of subsidies, and having studied business myself I do trust in the Haas study, but the thought of losing incentives for solar installation just doesn't feel right.

berkeley-solar-research.jpgCertainly, as some of the world's greatest products and services were started from University level research, Google anyone? it is important to continue funding that research but commercialization is a key component to driving that research to the marketplace and capturing public interest which ultimately makes the largest difference.

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2 Comments

Lee Devlin Author Profile Page said:

Subsidies are always controversial. I suppose it is a case of whether the subsidy is viewed as 'priming a pump', or if it's more like a permanent welfare program for a particular group or industry.

If the government didn't create the interstate highway system, do you think it would be possible that it would have been done by private industry? How about the GPS satellite system? Granted it was done for security purposes, but it spawned entire industries. Both of these are examples of government spending that in the end created jobs, opportunities, and economic growth that could not have been done by waiting for some cost breakthrough to make it happen naturally.

I think that our biggest obstacle to weaning ourselves off fossil fuels is their relatively low cost which is unlikely to rise until we are no longer able to find them. I feel that this is likely to occur suddenly rather than gradually, because the folks who sell us those products want to make sure that nothing replaces them while they still have some to sell us. Thus, the price may not ever allow a change over to renewables until it hits a crisis stage.

So I think that government subsidies for renewables, with the intent of getting renewables to become cost competitive with fossil fuels sooner is an example of a good subsidy to avoid the crisis which would otherwise result in the end.

Court Rye Author Profile Page said:

Great points Lee... So many benefits have come from these collective projects executed by the government and it seems like Solar is ripe for the picking! I guess the government can be involved with solar in a few ways, through CAL state schools, subsidies, or government research and defense projects.

We just need to figure out how to make weapons using solar technologies and the US government will jump right in! It could be argued that early solar progress originated from satellites that needed solar power in space... and that was pushed because of the Cold War with Russia right??

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This page contains a single entry by Court Rye published on February 23, 2008 12:21 PM.

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