Green Math Part 6: Reality bites the UK

In Britain, solar firms that believed the government’s promise of endless and generous green energy subsidies are learning a hard lesson.

Feed-In Tariff (FiT) rates for solar projects are being slashed by half:

Hundreds of solar companies were likely to go bust by Christmas, it was claimed, after Greg Barker, the minister for climate change, said “feed-in tariff” subsidies were too generous and would be halved.

One solar businessman sees no future at all in a world without subsidies:

Daniel Green, the chief executive of Home Sun, a solar company, claimed that the Prime Minister had given him two personal assurances of his support for the solar industry. “They have effectively bankrupted thousands of companies,” he said. “Most of them will be gone before Christmas.

“We built a business on the back of David Cameron’s promises. He has betrayed us twice. Anybody thinking of investing in government-sponsored green opportunities, I would advise them to run away. All my business will stop with immediate effect if this goes through. It’s an extremely black day.”

Estimates are that up to 25,000 jobs will be lost as a result of the change to FiT rates. That’s not good news for any economy, but the big picture is that many more jobs may be saved by slashing green subsidies.  British consumers and businesses are suffering as energy costs soar, with real worries about the number of seniors in fuel poverty this winter and major industries threatening to quit the country altogether.

If lower FiT rates can be converted into lower overall energy costs, it’s a good move for the country. The UK has admitted the cost of green energy is too high, just as Spain and Germany already learned. Britain lowered FiT rates for wind back in March.

shattered dreams

In Ontario, even the merest threat of a cut to the FiT programs was enough to force a solar firm to cut shifts. Canadian solar (and wind) firms that based their business models on FiT rates up to 20 times the spot rate for a KWh should be very nervous about the news coming out of Britain today.

The sad fact is that everyone except green energy zealots and politicians in their thrall saw this coming.

Greens say we need sustainable energy, but solar and wind are not the answer. The wind may blow for free and the sun may shine for free, but current technology to capture and convert those resources into energy needs public money at an unsustainable rate. It’s inconvenient, but it’s the truth.

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Green Math, Part 5: Green policies and energy prices

The Guardian’s Leo Hickman ponders a deep question:

Are green policies good or bad news for energy bills?

Hickman wonders if there could possibly be a connection between green taxes and rising energy bills in the UK, a topic that is quickly becoming a political liability for the Prime Minister and his lunatic Secretary of State for Energy and Climate Change.

There should be no surprise energy costs are higher. After all, that was the whole point of green policies:

Who knew that paying up to twenty times the market rate for wind and solar-power might lead to an increase in utility bills? If only someone could have foreseen the havoc that would be wrought by the green dream.

Oh, wait. Everyone did:

In fact, warmists got exactly what they wanted, green energy subsidized by taxes and fees levied against fossil-fueled generation.  What greens don’t want is any blame for the resulting hikes in energy bills.

Too bad. Own it, hippies.

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Green Math Part 4: Blue state sees red when green jobs turn yellow

Massachusetts gave solar panel manufacturer Evergreen Solar millions of dollars to bring green jobs to the state, but that didn’t stop the firm from shuttering the plant in Devens, Mass. and moving to China, where costs are lower.

Governor Patrick wants Evergreen to return up to $21 million of the grants it was given, but that is unlikely to happen:

During his monthly appearance Thursday on WTKK-FM, the governor also criticized the chief executive of Evergreen for his comments to a legislative committee this week. Michael El-Hillow told the panel his company didn’t intend to return any of the more than $20 million in direct grants it received from the state.

Evergreen is taking care of business and the poor folks in Massachusetts are left with nothing much to show for their tax dollars. The move to China was no secret – it was announced in Fall 2009, just 18 months after Gov. Patrick announced the state’s funding support for Evergreen:

Mr. Patrick first heard about Evergreen Solar while running for governor and has since worked with the company on its expansion while making the addition of clean energy development companies a priority.  Evergreen Solar is receiving $23 million in state grants, up to $17.5 million in low-interest loans and a low-cost, 30-year lease of state-owned property for the Devens plant.

The thirty-year lease ended up being ten times longer than Evergreen needed.  Before taxpayers get too mad at the businessmen, they may want to ask legislators why they gave evergreen another $5 million after the decision to move to China was announced:

In November [2009], the company said it would stop assembling solar panels in Devens and move the work to China in order to compete with other solar manufacturers. The outsourcing could potentially eliminate 150 to 200 jobs in Massachusetts starting in mid-2011.

The decision to shift work to China has been controversial because Evergreen received $58 million in state loans, grants, and other aid to build the Devens plant. MassDevelopment, a quasi-public agency, recently voted to give the company an additional $5 million loan, despite Evergreen’s deteriorating financial condition.

As if this tale of woe isn’t bad enough for Gov. Patrick, the state also subsidized the other end of the transaction with generous payments for Evergreen’s customers:

In addition, in January the state started a rebate program that defrays up to 60 percent of the cost of installation of solar panels for homeowners, and up to 40 percent for businesses, Mr. Patrick said.  A law signed by the governor earlier this month requires utilities to get 15 percent of their power from renewable sources by 2030 and will permit utilities enter into long-term contracts of 10 to 15 years for renewable energy sources.

Not even mandated demand and sweetheart customer pricing could save green jobs, which makes the Governor’s predictions of a bright green New England future ring hollow:

Mr. Patrick said that not all manufacturing is practical in Massachusetts any longer, but life sciences, technology and clean energy are part of the state’s future.

Or not.

What happened in Massachusetts is likely to be repeated across North America and the EU as renewables fail.  The technology isn’t good enough, the costs are too high and the fact government money for the manufacturer and customer can’t make the math work is the last nail in the coffin for the promise of green jobs.

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Green Math: Part 3

Ontario’s green energy numbers don’t add up:

Wholesale Average Weighted Cost (YTD) of Ontario electricity: 3.35 cents/kWh

Guaranteed 20-year contract price per kWh for solar panels (ground level): 64.2 cents/kWh

Guaranteed 20-year contract price per kWh for solar panels (roof-top): 80.2 cents/kWh

Guaranteed 20-year contract price per kWh for wind turbines: 13.5 cents/kWh

(link to microFIT rates, pdf)

Cost to the province in 2011 to reduce bills by 10% to hide increases caused by green energy programs until after the election: $1.1 billion

Ontario has promised to pay renewable energy producers up to 23 times the actual price for electricity which is the driver for increased bills and time-of-use billing.  At risk of belaboring a point, sustainable subsidies are not sustainable.  Premier Dalton McGuinty has pulled the plug on offshore wind projects – it’s time to end the FIT programs before they bankrupt us.

The opposition understands math, even if Dalton doesn’t.

Prior fun with numbers:

Green Math 1

Green Math 2

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Met. Office Math

Britain’s weather gurus at the Meteorological Office (‘Met’) have an operating budget of £170 million, a £33 million super computer and just handed its people £12 million in bonuses.  Despite all that cash however, the forecasters cannot forecast reliably.

In typical government fashion, rather than identify and fix the problem, the Met spins in an effort to offset the enormous cost of crappy forecasting by attaching a ‘value’ to its contribution to the nation.  The Met values its contribution at over £260 million, an entirely fictional number derived from the perceived financial benefits of saving lives and property with accurate forecasting.  Hmm, see a problem?

The Met Office has no debit column for when they get it wrong, making their estimate of value as useless as the barbecue summer forecast.  Here’s the Met’s one-sided table:

All upside, all the time

The Met stacks the deck in its favor with a simple rule: If a forecast ‘saves’ a life, the Met. credits its ‘value to the nation’ account with £1.478 million. But if people die from weather related causes, the cause was probably ‘climate change’ which is totally not their fault, so they don’t take a hit for the corpse.  It’s Green Math and we’ve seen it before.

Three examples where the Met should have taken a debit:

The Met Office has a poor record of forecasting, most recently for the Summer 2009 debacle, but in the world of environmentalists, ability has nothing to do with credibility, so the Met feels perfectly able to predict global disaster 50 years into the future.

My advice, use one of these:

accurate and cheap

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Green Math, Part Deux

Math is hard and hippies are, well, hippies.

Greens like to do things that make them feel good about themselves, whether or not their actions actually do anything meaningful for Gaia, which is why they hate it when pesky facts shatter their planet-saving self image.

Remember Cash for Clunkers?  The basic idea was twofold; to take old, polluting cars off the road and replace them with new, shiny green-friendly machines, and secondly to inject life into a struggling auto-industry.  $3 billion later, now the event is over, it’s time to reflect on what sort of deal clunker-traders got:

If you traded in a clunker worth $3500, you get $4500 off for an apparent “savings” of $1000.  However, you have to pay taxes on the $4500 come April 15th (something that no auto dealer will tell you). If you are in the 30% tax bracket, you will pay $1350 on that $4500.

So, rather than save $1000, you actually pay an extra $350 to the feds. In addition, you traded in a car that was most likely paid for. Now you have 4 or 5 years of payments on a car that you did not need, that was costing you less to run than the payments that you will now be making.

But wait; it gets even better: you also got ripped off by the dealer. For example, in LA every dealer was selling a Ford Focus with all the goodies, including A/C, auto transmission, power windows, etc for $12,500 the month before the “cash for clunkers” program started.  When “cash for clunkers” came along, they stopped discounting them and instead sold them at the list price of $15,500. So, you paid $3000 more than you would have the month before… (Honda, Toyota , and Kia played the same list price game that Ford and Chevy did).

So let’s do the final tally here:

You traded in a car worth: $3500
You got a discount of: $4500
———
Net so far +$1000
But you have to pay: $1350 in taxes on the $4500
——–
Net so far: -$350
And you paid: $3000 more than the car was selling for the month before
———-
Net -$3350

Your government at work, in the name of green.

Green Math Part Un is here, featuring the amazing 83-year depreciation of a 20-year asset at Nellis AFB.

Green Math

It’s not easy being green, math is hard, and so on.

Here are three examples of math not working out so well for hippies, because you’re worth it.

Britain’s Daily Telegraph looks at the price of ‘green’ cars, by which I assume they mean eco-friendly and not shades of teal:

The ‘green’ model cost £4,760 more that the budget model. To benefit from the difference in fuel efficiency, you would have to drive 198,690 miles – the equivalent of driving round the world eight times.

Next we have the inconvenient solar panels at Nellis AFB, which I pointed out in last weeks round-up:

President Obama traveled to Nellis AFB to celebrate their use of solar power.  Now for the inconvenient truth; the 72,000 solar panels cost $100 million and saves the Air Force $1.2 million annually.  So it’ll pay for itself in about 83 years.  What a shame the useful life of a solar panel is only 20 years.

Third we have a man that proved ineffective to the point of incompetence on Darfur is trying to warn about the dangers of a hoax, when the real evil is green:

Kofi Annan claims that global warming might kill 300,000 people a year.  Why, that’s almost a third of how many African kids Greenpeace’s activism will kill each year.

Greens aren’t good at math, yet we are supposed to believe they know the future of the planet from computer models.  Color me unconvinced.