Financing to speed Renewable Energy Transition....

Today’s post: Weds, 6-4-2008

Relying on fossil fuels for energy, we are now realizing, is NOT environmentally safe. This is particularly true for burning coal; but it’s also true even if to a slightly smaller extent for burning natural gas.

What is still often missed even with the recent run up in the price of oil -- & of gasoline in the United States, is that it is no longer ECONOMICALLY safe.

When they are healthy, economies grow. And, usually populations grow. So the demand for energy will reliably increase as economies can only grow if they have access to more energy.

Since our supplies of fossil fuels are finite, & our effective access may even have begun to shrink, this means that the time has come or will very soon that prices will go up & that will likely accelerate if we continue to use fossil fuels only. It’s also incredibly important that we have put other sources in place well before we run out totally.

The good news is that solar photovoltaics & solar thermal electricity are already approaching being LESS expensive ways to generate electricity than burning fossil fuels to do so.

And, now that increasingly, regulation will be used to put some of the environmental cost of burning fossil fuels into their cost, fossil fuel prices will rise faster than the economy can easily adjust to.

We may be able to solve that problem in part with increased use of nuclear energy as we have posted about before here. But the costs of being absolutely sure that it is done safely, though it looks doable, will keep the costs from being low of electricity generated by nuclear energy.

In addition, the political resistance of people concerned with these safety & security issues will guarantee that to the extent we do use nuclear energy, in the near term it will not come online quickly.

So, that means we are facing real economic disaster maybe within 20 or 30 years & possibly even sooner from rising fossil fuel prices if we fail to put massive amounts of solar generated electricity & other renewable sources of electricity in place very soon.

Meanwhile, many homeowners, owners of rental properties, & businesses do NOT have the cash or safe to use credit to finance installing solar electric power generation at their home or facilities.

To some degree, governments & utility companies will solve this problem by building solar electricity generation in more concentrated & centralized facilities. Some utilities are already doing so, which is an encouraging sign. And, Nanosolar is working to have many city governments do likewise – using its products of course. But they make a convincing case for it.

But these programs take time to bring online & they are NOT enough by themselves to produce all the solar generated electricity we need.

The good news is that if the financing was somehow available so that property owners in favorable locations could install solar photovoltaic panels on their property, it looks quite likely that increasingly the cost per month of the financing will be LESS & then MUCH LESS than the cost of buying the same electricity from fossil fuel powered sources.

And, if this financing were available, any given property can have the installation done in less than two months & less than 3 weeks in many cases.

This means that if the financing were available, hundreds of thousands of property owners or even millions could install solar in just a few years.

Although it is not available to everyone or desirable for everyone, the good news is that some such financing is actually available NOW.

It seems that there is a company called Tioga Energy in San Mateo, California with website: http://www.tiogaenergy.com/ that makes such financing available to some businesses.

Their conservative mathematical analysis in the paper they offer on their website shows that by historical standards a qualifying business has about a two thirds chance of paying less for the contract payment to Tioga Energy per month than they would pay if they continue buy fossil fuel energy, particularly in California.

It looks to me that the chances are quite a bit closer to 100% & that the savings will be at least triple the payments to Tioga Energy over the time period of the contract they put in place.

And, they make the excellent point that business paying them have predictable costs that will NOT suddenly double in two years or worse. Businesses getting electricity from sources that burn fossil fuels may well have those problems.

There are basically 3 constraints; & so far only businesses can apply:

1. The facility of the business must be in an area where enough solar electricity will be generated to produce enough electricity to make the numbers work.

2. Only stable businesses that own their facility & property will be able to do the long term contract necessary.

3. Solar systems are not yet well designed to be folded back for new roofs to be installed. So a new roof with enough reliable life must be in place or installed. And, it must be financed separately.

Even with the constraints though, this is an extremely good idea. And, I think it will save those businesses that do become customers a LOT of money.

And, since this is already in place, as solar cells come down in price & go up in efficiency, solar installations become designed to be moved easily for roof repairs or replacement or fire access, & the price of fossil fuels doubles again & again, I think this business will grow.

And, I think governments may well step in to make it possible & economic for businesses that lease their facilities & home owners & owners of residential rental estate to do a deal with the government agency so that they can also participate in such financing.

Lastly, if you have a qualifying business, one of the great advantages of the service provided by Tioga Energy is they deal with all the permitting & incentive paperwork for the solar installation.

Unfortunately, this is so complex & difficult now, in a business where the owners or executives need to get the work of the business done, they simply may not have the time to orchestrate a solar installation. In that event, Tioga Energy can get the solar installation done with no time needed from the management of the business.