Renewable Future

[ThisDinosaur]

http://www.huffingtonpost.com/entry/tes ... e15024fa1f

Solar power has been *about to change the world* since the seventies, giving it a track record similar to cold fusion. I am familiar with arguments against the sustainability of solar power and its ability to replace fossil fuels.

https://ozziezehner.com/book/
https://www.ted.com/talks/david_mackay_ ... anguage=en
http://www.lowtechmagazine.com/2015/04/ ... power.html
http://www.lowtechmagazine.com/2008/03/ ... ide-o.html

And the peak oil origins of this blog and forum provide lots of pessimism about the future of the west's energy intensive way of life.

http://forum.earlyretirementextreme.com ... =renewable
http://forum.earlyretirementextreme.com ... le#p118988

But I can't square these facts in my head with the fact that so much solar energy hitting the earth is available to us for the taking.

http://www.techinsider.io/map-shows-sol ... rth-2015-9

What am I missing here? What's the source of conflict in these narratives and how should an investor capitalize on it?

[jacob]

Focusing on the area is a red herring which is similar to saying that the Earth is not overpoluated because all 7 billion people could fit inside a cube half a mile long.

What ultimately matters is the unsubsidized EROEI of solar panels. The higher that number is, the more energy there is to do other things than strictly trying to get more energy.

Here's a primer: http://energyskeptic.com/2013/2012-global-eroi/

In particular:

1.1 : 1 Extract oil
1.2 : 1 Refine Oil
3 : 1 Transportation
5 : 1 Grow Food
7-8 : 1 Support Family of Workers
10 : 1 Education
12 : 1 Health Care
14 : 1 Arts and other culture Source: (Lambert)

The EROEI for PV and wind is thought to somewhere between 10 and 15. Obviously the initial steps are different, e.g. build turbine, build generator, build grid system, build energy storage system. For solar, it's even more complicated. You can dig for oil with a shovel, but you can't make PV elements with a shovel. You can imagine that it's pretty hard to calculate directly. E.g. preventing a technology from being bootstrapped/subsidized by another (e.g. 50:1 oil) either directly or indirectly (e.g. by feeding the workers and universities that support the knowledge for semiconductor technology.)

The reason people are still debating this is that the number is right around where it might be viable unlike ethanol and fusion which are now only pursued for a few special applications, e.g. sugar cane or research.

These numbers have been skewed by financing (which indirectly takes higher EROEI sources from other places in the economy). This can lead to significant bubbles. For example, a lot of the shale operations were built using debt contingent on prices staying over $100/bbl. However, the rest of the economy did not have the ROI to keep it up there, so this resulted in a temporary misallocation. Kinda like back in the 2000s when the US Gov decided to subsidize corn for ethanol.

The question is whether PV or wind find themselves in similar situations.

[ThisDinosaur]

EROEI estimates for Solar Thermal range from 20:1 to almost 50:1. Of course, resistive losses from trans continental cables become problematic. But since the total energy potentially available is so large, doesn't that impact the value of this ratio? (So long as its substantially larger than 1 or 2:1)

[ThisDinosaur]

According to energyskeptic.com, Solar Thermal has an EROI of about 8:1.
That appears to exclude storage, transmission, or DC->AC conversion. So, at best, its comparable to locally produced PV.

Lets assume that all centralized solar installations are doomed to fail. Does that mean Suburban Homesteaders shouldn't bother putting PV panels on their roofs? Or does that mean we should buy them NOW while their costs are still "subsidized" by low fossil fuel costs?

And how should one invest, given this insight? Do you short all renewable energy companies because they've consistently underperformed for 40 years (using essentially unchanged technology)? Or do you buy in early since they tend to be subsidized by governments? (Consumers of energy from Ivanpah get overcharged for an essentially gas-powered plant, and the difference gets pocketed by investors.)

I'm also curious if anyone here has installed residential solar, and whether they think its saved them any money.

[BRUTE]

from what brute has read, ROI (not sure if subsidized) of PV has gone up dramatically since ~2000. is this merely the cause of the aforementioned bubble, or has technology really improved?

[vexed87]

http://www.peakprosperity.com/podcast/1 ... op-running

[theanimal]

I live in a remote spot in northern Alaska. Most people here have solar as the major energy provider throughout the year. 8 months of year the sun is out long enough to be the major source of energy for all households. With $1.35-$1.60/hr to run a generator, you'd be stupid not to have solar. Some here have had solar for 30+ years. The glass panels don't wear out and pay for themselves here within the first year. There's not many areas in the US or elsewhere where it is such an easy choice.

[jennypenny]

The cost of a full solar installation with battery and grid hookup for our home is half of what it was when we moved here 16 years ago, not counting any tax rebates then or now. It puts our break even at under 5 years.

How can you count the ROI of solar panels without factoring in the life of the panel? Is that factored into any of these calculations? If I can maintain the panels for 25 years, I'd get back 5x what I paid for the system. So if the ROI is only 8x, is that 40x if it lasts 25 years? Sorry if I'm asking a dumb question.

[jacob]

One thing to keep in mind is the different timeframes of these [future] discussions:

1) Are we talking about what level civilization people will enjoy in the 22nd century? Or the 24th?
2) Are we talking about what's the optimal choice over the next 60 years? In that case, optimal in what sense? Preserve personal comforts? Alternatively provide the best foundation for the grandchildren? Also, do we care mainly about people locally or do we consider global impact? What do we value? Party-consumerism? Medial care? Freedom? Knowledge? Happiness? What if you can only pick two of these?

DNA sharing arguments suggest that most humans don't give a s*** what happens to people that share less than 3% of their personal DNA e.g. grand-cousins or their offspring 5 generations (150 years) from now, whereas they'd care greatly to the extent of cousins (in terms of geography) and grandchildren (in terms of time). That would be the most rational assumption. Humans have a somewhat high discount factor. We're emotionally inclined to be more like rabbits. Less like trees or sharks who live for 400 years.

Anyhoo, seems to me that oil was unique. At an EROEI 100-200, it was a high-point. The future (22nd century) will be less "intensive". Insofar it's going to be as productively as the 20th century, it will have to be guided by smarter principles than the 20ths century because intelligence will have to make up for inferior sources of energy. Now, where do we find this kind of intelligence?

[ThisDinosaur]

@theanimal
How would you say your neighbors use of electricity compares to the average, grid connected homeowner in the lower 48? (I would imagine you all use much less out there in the boonies.)
Do they generally think power output has been consistent over that 30+ years, or have they had to replace panels, inverters, components a lot over that time?

@vexed87
I have been reading lots of energyskeptic.com today following Jacob's link above. I wasn't aware the author was a transportation expert.
Searching the site doesn't seem to bring up any info on her opinion about the recently announced Tesla Semi trucks.

https://electrek.co/2016/07/20/elon-mus ... an-part-2/

Most freight travels < 250 miles (http://www.rita.dot.gov/bts/programs/fr ... _haul.html) which is conducive to solar charged electric trucks. Especially since the underside of the trailer has LOTS of room for a large battery pack.

Musk seems to think he can manufacture solar power infrastructure completely in house using ONLY renewable energy. And keep it profitable. I think that remains to be seen, but does anyone have any strong case one way or the other? Alternatively, coal can be used for smelting PV components and powering an electric vehicle fleet and we are at least 100 years from running out of that filthy stuff. So another plus for investing in an electric future.

@BRUTE
That's one of my concerns. I don't know. Green tech enthusiasts have been promoting this stuff since Jimmy Carter (when theanimal's neighbors moved to Alaska.)

[ThisDinosaur]

@jennypenny
This is the calculation that concerns me:

(a)Add up the total cost of the system (panels+inverter+battery...).
(b)Add up how much you would pay for repairs, maintenance, additional (grid?) electricity over [timeframe].
(c)Then add up how much you would be paying for power without the system over [timeframe].

At what point in time is a + b < c ? If its longer than the time the system would last before needing replacement, you shouldn't buy it.
I've read that adding a battery to the system significantly reduces the economic benefit of buying a PV system, since they wear out first. Has that been your experience?

@Jacob
I doubt anyone's ability to predict what the 22nd century will look like. But I think you might be able to get an idea of how the next 50 years might play out. You've expressed the idea that the world's standard of living will decline to our grandparent's level in the next 100 years. I guess I'm looking for 1) an out to the apparent inevitable secular decline of the world markets, and 2) an insight into whether any form of renewable energy technology has merit worth investing in personally or financially.

[vexed87]

Most freight travels < 250 miles (http://www.rita.dot.gov/bts/programs/fr ... _haul.html) which is conducive to solar charged electric trucks. Especially since the underside of the trailer has LOTS of room for a large battery pack.

Energy storage tech simply isn't there, lithium-Ion batteries are not sustainable, lead acid batteries are too heavy for mass transportation. The way we move goods around is going to change dramatically. Society will get a whole lot less complex when our last conventional oil wells start to dry up.

This was a good read regarding electrification of trucks:
http://energyskeptic.com/2016/diesel-fi ... ic-trucks/

[ThisDinosaur]

Agreed. Batteries are a mature technology and will never really compete with cheap oil. A diesel vehicle doesn't have to carry around all the oxygen it uses or the CO2 exhaust it expels. A battery powered vehicle effectively does have to do that. There's no comparison.
However, when oil gets rare and expensive enough, then expensive/inefficient electric trucks might become more attractive. Like you said, things will change dramatically.

The energy to charge those batteries have to come from somewhere, because people won't voluntarily give up high energy consumption over night.
Meaning whoever has got the biggest stake of the renewable energy market beforehand should outperform.

This brings me back to the point of my post. Which was trying to figure out:
1)should I cover my roof with solar panels or is it a waste of money?
2)should I invest in i.e. SolarCity, green tech/renewables ETF, motif, whatever?
3)should we take the apocalyptic interpretation of peak oil at face value without questioning it?

Expanding on that third question, is it reasonable to assume that it will ALWAYS be too expensive (in terms of EROEI) to harvest all that wasted solar energy hitting this planet?

[BRUTE]

1) Are we talking about what level civilization people will enjoy in the 22nd century? Or the 24th?
2) Are we talking about what's the optimal choice over the next 60 years? In that case, optimal in what sense? Preserve personal comforts? Alternatively provide the best foundation for the grandchildren? Also, do we care mainly about people locally or do we consider global impact? What do we value? Party-consumerism? Medial care? Freedom? Knowledge? Happiness? What if you can only pick two of these?

brute was specifically asking for the next 50 years. he does not care much for civilization or civilized people.

of the options given, brute picks "preserve personal comforts" and "locally".

brute doesn't require much energy directly (gas for hot water and cooking, and 45w for the laptop), but suspects that there's a whole bunch of energy involved in the supply chain of the laptop. the whole eating/showering thing seems to have been around for a while, so it might not go to the shitter when peak oil hits the fan. laptops probably will.

Now, where do we find this kind of intelligence?

what if humans sent every kid to college?

[theanimal]

@ThisDinosaur- Most use significantly less electricity than the average in the lower 48. To power their household completely off solar, they aren't wasting any electricity. No desktops, no dryers, and an emphasis on high efficiency/mobile appliances.

Power input has been consistent for that time period. Most have been using the same panels for 20-30 years, with minimal decrease in output. They don't wear out. Batteries are the highest cost item that need to be replaced. If you maintain them well, a good battery will last 6-10 years. Although, occasionally there are duds that last 2-3 years. Other than that, they aren't really replacing too many components. There has been a much greater replacement of appliances, however, as things have become more and more efficient. LED lights were/are huge. In mid winter, when the sun is below the horizon or low on the horizon for months at a time, people use a generator to power up their battery bank. Switching from CFLs to LEDs cut some people's generator run time in half. Huge savings.

Solar works on a small scale. If people cut their energy use, it can be a major energy source. It cannot power industrialized society though. I also question where the materials for solar panels and their components are going to come from since the products are petroleum based.

[jacob]

This brings me back to the point of my post. Which was trying to figure out:
1)should I cover my roof with solar panels or is it a waste of money?
2)should I invest in i.e. SolarCity, green tech/renewables ETF, motif, whatever?
3)should we take the apocalyptic interpretation of peak oil at face value without questioning it?

1) Given the expected ROI of passive paper-investments over the next decade (about 0%), buying something that makes itself back is likely worth it. Particularly when it comes to energy. In general, when yields are low, you want to prefer owning assets because it's hard to pay cash to rent them if you don't. Since 2013, I've been trying my damndest to buy assets that are as far away from US equity as possible (except for the rare exceptions of pockets of profitability that goes away really quickly).
2) No, not necessarily. Once you start investing actively, there's no blanket rule/simple solution for what to focus on (you paying attention Zalo? ). Using oil as an example, there's a big difference between investing in a refiner (benefits when oil is low), an explorer (when oil is high), or an integrated (according to their leverage). ETFs just means you're going in blind believing that experts have a better clue than you do. PV or Solarcity bonds are not much different.
3) Yes. Insofar it's not informed questions, please do. Best avoid another tobacco or climate change agnotology.

[BRUTE]

lung cancer's just a theory!

[ThisDinosaur]

1) That's exactly how I view purchasing residential solar now; a hard asset that makes its own cost back...IFF indeed it does.
2) A blanket rule/simple solution would be nice, but I'm only expecting insight into whether renewables companies and stocks will be profitable if/when they become the only game in town. Agnotology and all, governments seem prone to pushing these industries for at least the last half century, and 7:1 EROEI is > nothing.
3) Insofar as I am uninformed, how else should I hedge against my own ignorance? (I'm not a fast enough reader to learn EVERYTHING before it's time to invest my next paycheck. )

[jennypenny]

@jennypenny
This is the calculation that concerns me:

(a)Add up the total cost of the system (panels+inverter+battery...).
(b)Add up how much you would pay for repairs, maintenance, additional (grid?) electricity over [timeframe].
(c)Then add up how much you would be paying for power without the system over [timeframe].

At what point in time is a + b < c ? If its longer than the time the system would last before needing replacement, you shouldn't buy it.
I've read that adding a battery to the system significantly reduces the economic benefit of buying a PV system, since they wear out first. Has that been your experience?

(c) is what concerns me. Rates have fluctuated quite a bit here. We have nat gas as well as electric, which gives us some wiggle room, but I don't think nat gas rates will ever be lower than they are now. It's basically locking in a cost that I'm comfortable with, and also locking in access to a reliable power source.

The battery capacity we want doubles the cost of the system. Since reliability is as important to us as cost, we wouldn't install a system without batteries. We also have a good location/setup, so we plan on using all of the available space and generating more power than we need. You don't get much, if anything, for selling it back here (PA is a coal state), but we want the extra capacity in case that changes, our needs change, or we want to provide some power to neighbors. (we've discussed how to keep refrigerators, charging stations, or even extra washing machines in the garage that neighbors could use)

Friedemann (author of energyskeptic.com) has a new book out and has been making the podcast rounds. She addresses the tesla truck in one of them (sorry, can't remember which).
http://kunstler.com/podcast/kunstlercas ... p-running/
http://www.peakprosperity.com/podcast/1 ... op-running

Has anyone read her book "When the Trucks Stop Running"? I want to read it, but it's pricey.

[jacob]

2) It's not if/when. It's when. The question is whether when that happens, stocks will still be widely traded. It will be a good while (50-75 years) before EROEI for conventional oil will get that low so if ROI is the goal, it seems better to invest in oil&gas companies (staying away from shale). 7:1 is desperate times---at least from our perspective. It's half as effective as a coal-fired society in terms of providing surplus energy. Such a society will not be able to afford high level education (you'll be out in the garden from age 10) for more than a tiny fraction of its population---if people are smart about it, these people will be educated in maintaining those very precious panels.

In the interim, the price of PV companies will be volatile according to the general price level of other energy commodities. Prices can go really high but as we've seen, developed world economies can't sustain $100+ oil (energy) for very long before the economy comes crashing down. The reason is that the EROEI simply isn't there ... maintaining the energy system AND the consumer system can't be done at the same time with low-quality sources. We're kinda in the fortunate situation that a lot of infrastructure (buildings, roads, education) already exists. However, when it's eradicated, like NOLA or LA, you can see how it's very expensive to build back up and sometimes it's not considered worthwhile.