Solar Power and subsidies

An article in today's New York times reports on thermal solar power plants being built in the SW states. Costs are high, compared to coal fired plants, and a subsidy is provided:

"The solar plants receive a federal tax subsidy, like other types of renewable energy, which makes the economics work for builders but also feeds skepticism about the technology’s long-term potential. “Unless there’s a subsidy involved, it doesn’t seem like a very attractive technology,” said Revis James, a renewables expert at the Electric Power Research Institute, a utility industry consortium."

I don't know what else Mr James said, but his comment is disingenuous. Coal and other fossil fuels receive subsidies of all kinds. The oil and coal companies receive tax rebates to compensate them for the diminishing supplies of coal and oil. The power companies receive rebates for building the plants in the first place, and more rebates for installing pollution control equipment. And everyone involved externalises the costs of whatever pollution remains after scrubbing, and of course the cost of CO2. Externalised costs are indirect subsidies. We all pay for them one way or another.

No one knows exactly what these subsidies amount to in cents/kWh, but there's no question that it's high. One thing is for sure, though: power generated from fossil fuel is not priced to reflect its actual costs. If it did, solar power would look a lot more attractive, and there would be a lot more effort to conserve power. There's not much point in increasing electricity supply if there isn't also an effort to cut electricity use.

The illustration used to help the reader understand the potential of solar thermal power is also interesting: "A megawatt is enough electricity to run 1,000 room air-conditioners at once." One of the things that struck me when I visited south Texas some years ago was the lack of insulation in most of the homes. Proper insulation would cut power consumption for air-conditioning by a third or more. The use of ground effect heat pumps would cut the remaining power demand by 75%. These two modes of conservation should be heavily subsidised. The payback in dollars for each installation would be ten years or less. The payback in energy savings would be substantially less.

Update 2020-03-03: The efficiency  of solar power cells has increased  substantially, They now convert a higher percentage of solar energy into human-usable energy than plants do. Dow has developed a method of painting solar cells onto any surface, which could make just about any surface available for generating power. The other problem of solar (and wind) is storage of surplus power. Betteries, heat sinks, and pumping water back into reservoirs are all feasible, Denmark has become the first country in the world to eliminate all fossil fuel power plants. Oil prices remain low, while extraction costs continue to trend up. Without subsidies the oil business would have folded long ago.