Jobs? Who’s Counting?

The American Solar Energy Association is forecasting an increase of jobs in the alternative energy and energy efficiency markets in the US.  They expect to see an estimated 500,000 new jobs created in calendar year 2009 by the addition of solar manufacturing capacity in the US, increased activity in contracting and installing solar electric systems and a variety of other activities.  I didn’t get the exact methodology of the estimate.  I take their word for it.

The American Wind Energy Association has similar things to say about increased employment as a result of the expanison of wind energy manufacturing capacity, testing, installation, service, etc.  55 new manufacturing facilities have been created in the US.  I know Colorado claims to have added 2500 new jobs in the wind energy industry.

Green jobs are here.  More green jobs are coming.

Let’s do some math.  The Department of Labor Statistics reports the increase in unemployment for August 2009 was 466,000 jobs.  That’s primarily new unemployment filings thoughout the US.  I know Texas announced job losses of 62,000 last month, the highest number of job losses in a long time.

The executive branch has tried to point to the reduced rate of job losses from previous monthly highs in the 600,000+ job losses per month to the current 466,000 of job losses per month as a sign of improvement in the economy.  As if a mere 466,000 jobs lost in August is somehow encouraging.

And similarly, there is a lot of political rhetoric about the green economy creating and replacing the jobs that the US economy is losing and jobs that “are never coming back”.

Let’s say, for the moment, that the new job creation is coming along as claimed and that there are 500,000+ new jobs as a result of all the alternative energy technology, wind and solar combined.  That would only offset one month of the current rate of job losses.

We need a lot more going on to offset where we are today.  Oil and Gas needs to be able to go out and drill for new supplies that we have available, like the BP find in the Gulf of Mexico that is the largest field in their history.  Bringing back refining capacity to this country will involve thousands of jobs.  Even if the use of gasoline declines over time with increasing numbers of electric and hybrid vehicles.

The creation of a new nuclear power industry using the latest reactor technology will require thousands of engineering and construction jobs and will bring new electrical capacity on line that is cleaner and more efficient than outdated coal fired plants.

A wholesale re-invention of the automotive industry to me would be a group of car companies that were serious about building the cars Americans want to buy, so we don’t have to buy from foreign suppliers.  That would bring back a percentage of the huge job losses being experienced in the state of Michigan.  With the trickle effect of glass, carpet, paint and electrical industries that supply to the automotives.

This would be the real complement to the “Green Revolution”.  And part of the solution to the unemployment problem.

Response to Big Wind

There were a number of emails relating to the posting on Big Wind a few weeks ago and I would like to make some clarifications.  My numbers were off, primarily based on the fact that “retail” rates for electricity such as you and I pay, are much higher than the wholesale rate which utilities pay.  The actual cost of electricity is around 4 to 5 cents depending on a variety of conditions that can influence the rate.  Based on that fact, the estimated payback for a large scale wind turbine is 2.5 times longer than my estimate in the posting.

In an effort to check the facts, I visited the American Wind Energy Association website.  There is a brief article (www.awea.org/pubs/factsheets/EconomicsOfWind-Feb2005.pdf)  that goes into some detail on the costs of large wind projects.  I used some of that information for a reality check.  They put a utility scale project analysis in the article that starts with a 50 MW capacity.  They say that a project this size would probably cost around $65 million to install.  I put in the recently published national average $1.93 million dollars per megawatt and got $96 million, a whole lot more expensive.

If the turbines are located on a site with wind available 35% of the time, and that’s a big number, the site should generate 150 million kilowatt hours per year.  The revenue will be around $6 to $6.75 million dollars a year not including maintenance, property taxes, management costs, etc.  Best case, the project will break even in about 10 or 11 years.  Worst case, 15 or more. Don’t know if the life expectancy of the equipment is 20 or 25 years.  I’ll check into that.

And by the way, medium size photovoltaic projects operate on about the same basis.  They are too expensive to make it worthwhile to take your home off the grid.  So the DOE’s “Million Roofs on Solar” project is doomed.  You can legislate a program, but you can’t make it work unless it pays for itself.  And the government doesn’t have enough money to pay for it for you.

These are really big numbers to be tossing around, and it makes me uncomfortable that the mainstream press doesn’t report on the facts.  Maybe that’s too much to ask.  It is a somewhat technical subject.

OK.  Here’s the real point.  The projects have many financial incentives like State and Federal subsidies, accelerated depreciation and investment tax credits helping to subsidize the costs.  That’s how we get to payback periods of 6 to 8 years.    So my math was wrong, but the final results are as represented.

When politicians make policy without facts, it comes out wrong.  Wind is great.  I am an avid wind energy enthusiast.  But we cannot create these massive alternative energy industries with billions of dollars of commerce that require government subsidies in order to operate.

I have done some numerical analysis of the wind energy problem and there are solutions that will result in 2 year paybacks for investors.  We need more innovation that integrates financial responsibility in the equation.  This is the kind of engineering that is self sustaining and will result in new jobs without government subsidies.

Solar Power, Mechatronics and Economics

At the recent Semicon show the big buzz was about the emerging Solar Energy industry. Lots of “new” products, lots of buzz. The big semiconductor machinery manufacturers who view crystalline solar cells as a stimulus to the demand for machinery and silicon have put in a lot of effort. The main goal? Get the cost of the solar cells down to where electricity produced with silicon is comparable to the cost of electricity generated by fossil fuel.

And, in fact, the industry is getting there. The current estimates are that solar power is costing about the same as peak demand consumer power, $.23/kWh. And with the current wave of investment and scale up, something which the semiconductor industry has always done well, there is serious forecasting that the cost of solar electricity will continue to fall. Read more

NanoGram’s Solar Cell Manufacturing Process Wins DOE Award

A laser-based silicon-deposition technique developed by NanoGram Corporation (Milpitas, CA) for solar cell manufacturing has won an Energy Innovator Award from the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy. The process reduces solar cell cost to the level of thin-film photovoltaics while delivering high efficiency, according to NanoGram.

Making crystalline silicon solar cells normally involves drawing boules of single-crystal silicon from a crucible full of molten silicon–a delicate and expensive process. Wafers are then sliced from the boule and then made into the finished product. What NanoGram has developed instead is a laser reactive-deposition technique that grows silicon crystals in a more-direct approach, reducing silicon consumption by more than a factor of four. Cost reductions generated using this approach are expected by NanoGram to bring solar cell module costs well below a dollar a watt by the time high-volume manufacturing production levels are reached in 2012.

An R&D pilot plant is currently under construction at NanoGram’s headquarter facilities.

Source: Laser Focus World