Solar energy named ‘sector of the year’ by stock picker
An investment service I subscribe to that picks “momentum” stocks has declared solar energy the Sector of the Year. That means it expects fast growth. Very fast.

The rationale: more efficient technology will bring down the price and political interest in incentives is growing. In Germany, a major user of solar cells, government subsidies made the difference. As our federal government ponders more incentives for alternative forms of energy, California already has a subsidy program, and other states are likely to follow suit. Plus China, Spain and Italy have all shown interest in solar.

I’m not picking stocks here – but often the investment community recognizes a good thing before the rest of us do. And these stocks have started to move (though they can be extremely volatile).

Solar has seen average growth of 25% a year over the past decade and a jump of 45% in 2005 (I don’t have the figure for 2006).

Japan, with its rebates for residential solar systems, is home to 4 of the 10 biggest solar companies. One Japanese company, Kyocera, recently announced plans to double its investment worldwide, by building plants in Mexico, the Czech Republic, China and at home.

Some basics
Today, solar cells – or photovoltaics – provide less than 1% of the generating power in the world. Yet sunlight has the potential to supply 5,000 times the energy now used by the planet, according to Scientific American.

Photovolatics can be installed on roofs or walls of buildings, in the desert, even sewed into clothing for portable devices, and the Pentagon is think about putting it up in space. California recently joined Japan and Germany in a major push for solar, with its “Million Solar Roof” plan to create 3,000 megawatts of power by 2018.

The biggest challenge is lowering the price, to make solar competitive with fossil fuels. Last fall it cost 20-25 cents a kilowatt-hour, compared with 4-6 cents for coal, 5-7 cents for natural gas and 6-9 for biomass. So subsidies are needed at this point.

Do-it-yourself solar systems
It makes sense for large companies and even homeowners to consider a solar system now, said Jennifer Openshaw of TheStreet.com. She gave 5 reasons:
* Increased cost of electricity, especially where peak-load prices are much higher.
* Reduced cost of installation. Manufacturing costs are an eighth what they were a decade ago and installation is simpler and cheaper.
* A federal tax credit of $2,000.
* A variety of state, local and utility rebates, tax-exemptions and low-interest loans.
* A battery storage system that will allow you to sell unused power back to the grid, taking advantage of peak pricing by buying at low-use times and selling at high.

A homeowner would spend about $6,000 (pre-rebate) per kilowatt of capacity, Openshaw said. A 3KW system would provide about 75% of peak needs for a 2,000-square-foot house. You would have your money back in 5-7 years and then could make money by selling any excess back to the grid, she concluded.

Larger solar projects
A number of solar power plants are already operating or on the drawing board:
*Abu Dhabi is using oil revenue to construct a 500-megawatt solar plant, part of its plan to become a center for clean energy development.
*Ontario, Canada, has just announced it will build North America’s largest solar plant next year, generating 40MW of power to supply 24,000 homes.
*Also announced was the second-largest plant for North America, a 15MW system at Nellis Air Force Base in Nevada. By year’s end, the plant will meet 30% of the base’s needs.
*Construction of the largest U.S. solar plant for civilian use has begun in Colorado’s San Luis Valley. The 8MW plant will supply power to 1,500 homes.
And there are many smaller ones – at home and abroad. Solar is clearly on the move.
(Sources: Scientific American, Greenwire, Reuters PlanetArk, TheStreet.com, Cabot Market Letter)


News briefs

1. Carbon tax or credit trading will cut cost of GHG reduction
The cost of cutting greenhouse gases will be much lower if governments get revenue from a carbon tax or auction credits in a cap-and-trade system, says the third and final report from the Intergovernmental Panel on Climate Change, released Friday in Bangkok. And acting now will be cheaper than waiting. Most models from IPPC show a drop in global GDP of less than 1%, with the effects spread over several decades, and could be partly offset by rising incomes worldwide, the report said. The most stringent scenario could cost as much as 5.5% of GDP. Other key points from the report, which zeros in on the year 2030:
* GHG cuts of 50-85% are needed to keep temperatures from rising more than 4 degrees F , in order to avoid dramatic changes in sea level and coastal damage.
* Without changes in energy and land-use policies, GHG will rise 20-90% in the next 25 years. They rose 70% since 1970.
* Land-use changes could cut emissions cheaply with carbon sinks in soil and forests, and better crop and livestock management.
* If carbon is taxed at $50/pound worldwide, renewable energies like wind and solar could jump to 30%. Nuclear energy would likely only increase from the current 16% worldwide to 18%, because of political fears and disposal problems.
* Energy efficiency could cut emissions in the building sector 30%.
* Carbon capture and sequestration could make an important contribution, though technology and regulation issues remain.
* Biofuels used in gas and diesel will probably grow to about 3% of demand, but could grow to 5-10% depending on oil and carbon prices and vehicle efficiency. Mitigation in transportation could be offset by enormous growth in the sector.
*Government support through tax credits, setting standards and market creation are critical to effective development and deployment of clean technologies.
* There are uncertainties about how regional economies will fare, but the economic burden will be less if competitive technologies are effectively diffused.
To read a 35-page summary of the report, go to www.ipcc.ch. Of special note are the charts on p. 13 (key mitigation techniques) and pp. 30-31 (policies and their constraints/opportunities).
(Sources: IPPC report, Greenwire)

2. China’s emissions may triple by 2050, but are hard to measure
China’s economy is surging (up 11% in the first quarter of 2007) and the country is building a coal power plant about every four days, according to the journal Nature. So its emissions must be soaring, but it’s hard to determine just how much. The traditional method to measure emissions is by energy use. Yet in China, crucial numbers are often missing, said Gregg Marland at the Oak Ridge National Laboratory. Any estimates could be off by 15-20%, he said. Also CO2 emissions are released in the making of cement and China produces 45% of the world’s cement, he said. If that were included in the numbers, China could be exceeding the U.S. in emissions now. Accurate data on China’s CO2 emissions may have to wait until next year, when NASA puts up its Orbiting Carbon Observatory. A Greenpeace report issued last week predicts that if nothing changes, China’s emissions could triple by 2050. Per-capita emissions are still a fraction of those in the U.S. (Source: Nature)

3. German uses explosives, tarp in effort to save last glacier
Each April for the past 14 years, Frank Huber, manager of cable car and ski operations at Germany’s last glacier, Zugspitze, spreads a huge sun-reflecting tarpaulin in an effort to slow the glacier’s death. Huber first uses explosives to set off controlled avalanches to bring more snow down to the glacier. The tarp then reflects the sun and protects the glacier from rain. Zugspitze is a big tourist attraction. About a half-million tourists take the cable car or cog railway to the 3,000-meter peak each year, and last winter a lack of snow at lower altitudes pushed skiers up to Zugspitze. Glaciers, very susceptible to climate change, are providing an early warning system, scientists say. IPCC predicts small Alpine glaciers will be gone by 2050. And with them goes the spring melt that fills rivers. (Source: Reuters PlanetArk)

4. Wildfire season could be bad, due to low snowpack, drought
The West may see some serious wildfires this year, because of warm temperatures, low snowpack and drought, the National Interagency Fire Center said last week. The Sierra Nevada and northern Rockies are expected to be dry early this year, which means a longer fire season. Idaho, where snowpack is only 55% of normal, and Montana, where it’s 75% of normal, are facing a higher fire risk. So are Alaska, Florida and Georgia, according to a Forest Service analyst. Two fires now burning in Georgia together make the largest wildfire ever recorded in the state. (Source: E&E News PM, Land Letter)

Congressional round-up

* Senate Energy Committee advances package of bills
A Senate energy package now on the floor cuts gasoline use 45% by 2030, requires a federal assessment of underground storage space for carbon sequestration, mandates 36 billion gallons of biofuels by 2022, and increases energy efficiency. It demands increasing amounts of cellulosic biofuel and says new fuel plants must produce biofuels that reduce GHG by at least 20%. Senate Energy Chair Jeff Bingaman (D-N.M.) has indicated he will add a renewable portfolio standard (RPF) on the floor requiring 15% of electricity from renewables like wind and solar by 2020. Republicans want to add coal-to-liquid to the package on the floor. (Sources: Reuters PlanetArk, E&E Daily)

*Boxer introduces competing biofuels bill, gets NRDC support
Senate Environment Chair Barbara Boxer (D-Calif.) put forth her own bill, calling for 35 billion gallons of biofuels by 2025. One point of difference from the Energy Committee bill is that fuels must be 20% better than gasoline in GHG emissions to qualify, and it calls for increasing volumes of fuels that are 50-70% better. Her bill also requires the EPA to reduce GHG from transportation fuel 10% (from 2008 levels) by 2020. The National Resources Defense Council prefers Boxer’s bill because in puts the EPA in charge. (Source: E&E Daily)

* Sanders introduces power plant-only bill in Senate
Sen. Bernie Sanders’ (I-Vt.) Clean Power Act of 2007 would freeze CO2 emissions from power plants at current levels by 2011 and then phase in cuts each year up to a reduction of 17% (from 1990 levels) by 2025. If in 2012 the government hasn’t acted on reductions of most (85% of) manmade emissions, power plants would have to cut an additional 3% a year until CO2 is stabilized at 450 ppm. (Source: E&E News PM)

* Commerce agrees on CAFE standards of 35 mpg by 2020
Sens. Daniel Inouye (D-Hawaii) and Ted Stevens (R-Alaska) are sponsoring a bill, released by the Commerce Committee this week, that would require corporate average fuel efficiency of 35 mpg for cars and light trucks by 2020, with an increase of 4% per year after that. Larger vehicles would be exempt, but must increase efficiency 4% a year. The bill, a compromise after Dianne Feinstein’s (D-Calif.) bill couldn’t make it out of committee, would give the Transportation Department discretion to make adjustments if the increases were not technically possible. (E&E News PM)


Do something

Tell your senators to vote for the Sanders-Boxer bill. It’s the most demanding of the Senate bills capping Global Warming, calling for an 80% reduction below 1990 levels by 2050, which is what scientists say is needed. The League of Conservation Voters has a campaign to support the bill. Go to www.action.lcv.org/campaign/sanders_boxer/wb568nw4oxd7ikj?

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Reader comment

Water worries in Midwest: Reacting to my water shortage piece, Mark Fogal of Missouri Votes Conservation points out that water is getting scarce in the Midwest too, after 7 years of below-average rain. In Missouri, aquifier levels are falling precipitously and the Missouri River flow is controlled by drought-stricken upriver states to the west.