Fostering a renewable source of energy
by SevenStrings, Fri Jun 20, 2008 at 09:21:01 AM EDT
There are very many hurdles in front of us before we can get to an era beyond oil ~ the era of renewable energy. Some of these hurdles are technological, some are economic, some are political.
But the biggest hurdle is in our mindset... beginning right here, amongst those that come to progressive blogs such as this one. We do not care enough about renewable energy to foster it's development. Let me give you some examples.
One historical challenge for the renewable solar photovoltaic industry has been lack of demand (happily, that is not an issue right now). Not enough people have cared to put their money where their bumper stickers have been ~ not enough solar panels on not enough homes.
Is this because not enough people can afford it ? Allow me to crunch some numbers for you.
A 3 kW solar photovoltaic system that is "grid tied" (i.e., you feed electricity directly into the grid) will cost about $14,000. You can install it yourself if you are mechanically inclined, or you can hire an electrician to install it for you for an extra $1000. Permitting that system is an extra $200. Thus, the total system cost is about $15,200.
If you live in California, you will get a rebate from your local utility for about $7000. In addition, if you are below the AMT threshold, you will get another tax rebate of $2000. Thus, the total rebates and tax breaks are about $9000.
The net cost to you is $15,200 - $9,000 = $6,200. With this "investment", you will generate about 365 x 12 ~ 4,000 kWhr/year. At a nominal rate of $0.08/kWHr, this works out to a return of about $320/year on an investment of $ 6,200 ~ about 5%. Not bad, eh ?
It gets better. In the summer months, you will use electricity a lot if you have an airconditioner. And electricity rates are tied to useage, so your normal summer rates are either $ 0.15/kWHr, or $0.21/kWhr... if you do not have that photovoltaic system. If you factor that into your consideration, your yearly savings increases to about $600/yr ~ about 10%. I do not know of very many investments that can guarantee that kind of return.
So what holds us back ?
Is it the capital requirement ? Not everyone can afford to plonk down $6000, even if the return on that investment is good. But there are plenty of financing available for such investments. Till not too long back, people were refinancing their homes to buy cars with expensive DVD Navigation systems ~ so financing was definitely available.
And that brings me to the final point.
We are much more willing to plonk down $25,000 for a new car, and then throw in an extra $2000 for a DVD Navigation system than we are to fund the photovoltaic industry. A cable TV substriction can cost $500/yr. An IPhone with a $50/month pricetag ~ no problem. A bluetooth headset that costs $30...must have that, cannot have cords dangling from my ear to my pocket.
But a $6000 investment that can help save the world ? That bores people. How about simpler measures like insulating behind the floorboards in your house ~ this takes an afternoon, and costs $20, but can save much more than that in 1 year alone.
That is the hurdle we face !!Update [2008-6-20 14:19:11 by SevenStrings]: MyDD must be having a VERY slow day. I just noticed this on the reclist, and so I checked. It is on the reclist with only 4 recs. Wow !! In any case, thank you guys (all 4 of you =)... I believe this is the first time I have made it to the rec list.