Seeking Alpha

Are utilities headed for a death-spiral?

  • "Subsidies and falling technology costs are making distributed solar power cost-competitive [and] as more people switch to solar, utilities sell less electricity to those customers [causing the] utilities [to] spread their high fixed costs ... over fewer kilowatt-hours, making solar power even more competitive and pushing more people to adopt it," WSJ's Liam Denning notes, describing what is dubbed "the death-spiral thesis" for traditional utilities.
  • Denning says it's the merchant generators (like NRG) that have the most to worry about: "For regulated utilities, the idea that solar panels will enable everyone to leave the grid, making such networks redundant, is overstated."
  • Although the threat may seem distant for now, Denning says it's worth taking seriously if you're an investor. "The gyres may look exceedingly wide, but that spiral is taking shape," he says.
  • Some individual names: Southern Company (SO), Edison International (EIX), Duke Energy (DUK -0.1%), FirstEnergy (FE -0.7%), XCel Energy (XEL +0.2%), American Electric Power (AEP -0.2%), Dominion (D -0.2%), Exelon (EXC +0.5%).
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Comments (48)
  • jroliver77
    , contributor
    Comments (78) | Send Message
     
    The long term thesis has merit, however we can not underestimate the intelligence and business management of the utility companies.
    They themselves may be the leaders in creation and maintenance of providing solar to the people. Although margins may squeeze they will not be left in the dust. Through combination of organic development and buyouts. Not great growth opportunity or situation at all but may help utility stock owners to realize that they do not need to go dump all of their holding in fear.
    23 Dec 2013, 10:57 AM Reply Like
  • davislake
    , contributor
    Comments (17) | Send Message
     
    Good points. Looks like the utilities are already on it.

     

    http://bloom.bg/1e8ODve
    24 Dec 2013, 11:34 AM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    I'm wondering what happens as we become more dependent on unreliable renewable sources. It can become very hot or very cold on cloudy days when solar energy is not that abundant and the same is true that it can become very hot or very cold on days the wind does not blow. What happens when those forms of renewable energy (which more and more people are becoming dependent on) do not produce enough energy on a certain day or few days to handle the needs of people and industry? The only forms of alternative energy that are pretty reliable that I'm aware of are geothermal, hydroelectric and maybe tidal. I don't see people talking much about those.
    23 Dec 2013, 10:58 AM Reply Like
  • MWinMD
    , contributor
    Comments (2825) | Send Message
     
    I'm wondering what happens when these newfangled horseless carriages being pushed by Henry Ford and the other trendy snake oil salesman don't work. What happens when some part breaks, or this stuff they call "gasoline" isn't available nearby, and you're caught without your trusty, reliable horse??? I think it's best we stick with what we know works. That's the way society has always progressed.

     

    Oh wait, wrong century...
    23 Dec 2013, 05:05 PM Reply Like
  • Joe_G
    , contributor
    Comments (314) | Send Message
     
    Well said, MWinMD.
    24 Dec 2013, 12:15 AM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    So MWinMD, in your world the sun always shines, the wind always blows and the electrical lines always stay put (unlike the ones which cut off power to vast portions of the country due to ice storms recently). Tell me MWinMD, what is the color of the sky in your world?
    24 Dec 2013, 10:10 AM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    MWinMD's post was well stated and very applicable. Time brings technological advances. To answer your question... You should look up storage and distribution systems. Remember when a saging power line in Ohio cut power to the east coast? Look how far we've gone to import and extract fossil fuels. Point is... You don't put all your energy eggs in one basket. I think the renewables give traditional forms of energy the competition they need, even if the solution isn't yours.
    24 Dec 2013, 11:31 AM Reply Like
  • MWinMD
    , contributor
    Comments (2825) | Send Message
     
    No, sox fan, but in my world the wind blows more than 2% of the time, which is the current portion of our energy portfolio wind makes up. And rumor has it that daytime makes up a globally averaged 50% of the 24 hour cycle. Ditto there.

     

    Anyone can see there is huge untapped potential here, if we can just stop listening to the "kill it before it can take hold and cut into my dead dinosaur industry's profits" crowd and the legions of prostitutes on Capitol Hill they have bribed to keep this deadly and devastating status quo entrenched.

     

    Congrats on the Series win.
    24 Dec 2013, 11:41 AM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    Whatever technological advances time brings, it doesn't change how much the wind blows or how much the sun shines. And the fact that one needs to put wind vanes and solar panels in the the most opportune places means greater lengths of power lines more prone to damage from natural or man-made causes. I agree that more sources of energy is better, but to believe solar and wind are some great panacea for which we can depend on 30% 40% 50% of our energy needs is pure fantasy.
    25 Dec 2013, 08:32 AM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    Thanks MWinMD for your response, it shows how flawed your thinking is. How often the wind blows and what percentage it is of our energy portfolio has nothing to do with what we're talking about here. Wind farms need to be constructed in areas where the wind blows much, much more than 2% of the time to be economically feasible. There are not many places where the wind blows hard enough and consistently enough. They also need to be built near where the power is consumed as power is lost when the lines are too long. And they need to be built where it is politically feasible. Take the energy conscious Kennedy's and Cape Wind. Great place to build them but the allegedly energy conscious Kennedy's are fighting it with every ounce of energy in their bodies because it will mess up their view. Mess up their view? What hypocrites.

     

    Anybody who believes that theses sources of energy can supply more than 10-15% of our energy needs in our lifetimes does not understand basic science or basic economics.
    25 Dec 2013, 08:43 AM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    I guess some people never learn. I suppose back in MWinMD's day, those people wondering where all that "gasoline stuff” to power those horseless carriage’s never envisioned the technology required to import 10.6 million barrels of crude a day from places like Saudi Arabia – on boats. I'm sure they never thought 2.5 million miles of pipeline could be built across the country - let alone an 800-mile long pipeline in the Alaskan wilderness. A “gas station” on every corner – that’s crazy talk! One-hundred and forty-three gasoline refineries producing 830,000 bbl/day?? That’s nuts.

     

    I'm happy the folks at the Lincoln Electric company don't agree with people like you. Their 2.5 megawatt turbine produces 10% of their requirments for their Euclid manufacturing plant and save/avoids $500,000 annually. But the point is - they call it a "start."
    26 Dec 2013, 11:20 AM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    Here's a live look at our turbine... http://bit.ly/19ri0LY

     

    It is a Aeronautic 750kW Medium utility class turbine. Its expected to produce 1.3 million kW per year, or enough to cover 70% of the high school's energy consumption. If you select the "Live View Data" - you will see historical and live data, include the average daily wind speed over the last year between 8 and 20 mph. So much for the wind never blowing - I mean, we all know Northeast Ohio is known as the wind capital of the world. Right?
    26 Dec 2013, 12:06 PM Reply Like
  • WPSPIKER
    , contributor
    Comments (1158) | Send Message
     
    DwightK:

     

    Boy you REALLY missed that one "I mean, we all know Northeast Ohio is known as the wind capital of the world. Right? " EVERYONE know's that is Washington DC and it is HOT air (I'm going out on a limb and saying it is real reason for Global Warming ;) ) :D

     

    Looks like the Live Data has some issues, for me, http://bit.ly/19rlldR there is good 20mph wind speed and rotor and generator turning at good speeds but seeing 0 output and the temp looks bad as shows 0F & here in Ohio is 33 (Mansfield) wind speed is good should be outputting power unless something disconnected?

     

    I always been wanting a wind generator at my place and looked at solar, built my barn w South Facing main roofs & live on one of highest points in Ashland County Ohio. It seems wind never stops blowing at my place but a few days a year...

     

    Where are several HIGH towers collecting weather data that have been up maybe 3 years now but I have no idea WHERE to look to see what their data collection is saying. I would not want a generator your size but something with a 8' blades 30' up would supply 50% or better of my power needs with a small WAT generator. I watch a LOT of the wind turbine info on youtube & love the "muddymuddymuddmann" stuff http://bit.ly/19rlldT

     

    Anyhow I am a firm believer in green energy systems but not in the companies for profitability wise but environmentally they are needed.

     

    I actually have a high drop creek running thru my place that one of these days when I'm independently wealthy will be BACK to a lake (it was for many decades but flood of 69 took dam out.) & put in a water generator system.
    Mark
    26 Dec 2013, 12:38 PM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    I'm not sure about the TEMP and OUTPUT readings. The schools are on break, I see the web site is "under construction" - but still, neither of those are important. The point is there is no reason to think wind and solar energy cannot - and will not - be a reliable energy solution.
    27 Dec 2013, 10:45 AM Reply Like
  • T. A. "Ike" Kiefer
    , contributor
    Comments (133) | Send Message
     
    @DwightK,
    Please promise to keep your live link up for the full 20-year lifespan (or whatever the installer promised you) so we can all monitor how it performs. Since your $1.9 million turbine was built with a $1.1 million federal grant from DOE, all taxpayers deserve to see how our involuntary investment pays off.

     

    Based on the project cost of $1.9 million and the population of Kenston Ohio at 17,400, the turbine's cost is $109 for every man, woman, and child in the town. And the 1.3 million kWh you say it will produce each year divides out to 75 kWh per person, which is just under 2 days of power for the average American and has a retail value of $8.63 at the national average of 11.5 cent/kWh. So, ignoring the operating and maintenance and electricity distribution costs for the turbine itself, and the operations and maintenance costs of the conventional power plants and huge grid infrastructure backstopping the turbine's intermittent output on a 24-7 basis, the turbine will have to operate flawlessly for 12.6 years just to pay for its project costs.

     

    If the AWEA's own data on wind and capacity factors are to be believed, 10% of the current US fleet of wind turbines are currently generating zero power (i.e., already broken). Maybe it's a bathtub failure curve, or maybe they are inflating the capacity factors, or maybe it's the 1980s all over again. Hope you have better luck than these folks in Portsmouth http://bit.ly/1cuFUot, whose 1.5 MW turbine failed catastrophically after four years and continues to bleed their town treasury of cash and shame the high school in front of 40,000 vehicles a day who travel the adjacent highway. Why do I hear strains of The Music Man? Well, that was Iowa, not Ohio. You should be fine.
    27 Dec 2013, 03:22 PM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    No problem, we’ll keep that link up as long as you like. Naysayers and negative-nellies like youself are part of the equation. You can nit-pick the numbers as much as you want. The objective remains – the Kenston turbine provides a real-time, working R&D environment aiding in the technological advancement of wind power as a supplement to existing energy solutions. All while augmenting 70% of the high school's energy consumption requirements. The Solar array at the Kenston Board of Education/Intermediate School and the second turbine slated for the Elementary school have similar objectives. BTW: Kenston is a school district – not a town.

     

    Too bad for the folks in Portsmouth. But they have to realize turbines are mechanical, with some 240k wind turbines in the world, some percentage of them will break down. Just like some oil and natural gas wells will be drilled – dry. Or better yet, some $560 million semi-submersible drilling rigs will explode, burn for 2 days, killing 11, and spilling 4.9 million barrels of oil into the Gulf of Mexico. We'll leave it to you to explain how fossil fuel failures are free to the American taxpayers and consumers.
    28 Dec 2013, 11:03 AM Reply Like
  • spinrbait
    , contributor
    Comments (517) | Send Message
     
    the article wasn't about whether renewables were a reliable energy solution. it is whether they will put utility companies out of business. wind and solar are already reliable energy sources. calling them "solutions", is saying there is a problem they need to correct. we will have to agree to disagree on that.
    there is an article in wall street journal about renewables today. they are not going to put utilities out of business. and i personally think they will cost consumers more. not less. if they were more efficient, gov't wouldn't be having to force them on the country. they would be all over the place.
    fwiw, duke energy is my biggest holding. they have approx: 14 wind and solar farms. but it takes almost 3,000 acres to build a solar farm which can produce 275 mw of power. it takes 20 acres for the same production with a natural gas plant. ironically, that was in my local paper this morning. (anderson independent).
    oh, i also read in the wsj, that 10% of electricity production is from renewables in texas. and virtually 0 in new york. now who would have guessed that. ;)
    29 Dec 2013, 05:38 PM Reply Like
  • smurf
    , contributor
    Comments (4702) | Send Message
     
    I read this article this morning, and it is very thin gruel indeed.

     

    The story doesn't live up to the alarmist headline. No mention of the percentage of solar to date, nor the projections for the future. And, it doesn't even mention the initial cost of implementation.

     

    Surprised this author didn't throw in wind while he was at it.

     

    Of course, investors should be alarmed about EXC, but it has nothing to do with solar.
    23 Dec 2013, 11:05 AM Reply Like
  • MWinMD
    , contributor
    Comments (2825) | Send Message
     
    Warren Buffet's utility company says that wind is already cheaper than coal. So much for the knee-jerk renewable bashers. They were "right" for the usual handful of years as a new industry ramped up. (What a shocker.)

     

    http://bloom.bg/1fAJIEN
    23 Dec 2013, 05:08 PM Reply Like
  • T. A. "Ike" Kiefer
    , contributor
    Comments (133) | Send Message
     
    The easiest way to become a millionaire . . . is to start as a billionaire. And to invest in wind.
    http://bit.ly/19QFhES

     

    Buffet also just bought big into Exxon. Playing both sides is a hedging strategy. Shocker.

     

    As things stand, I don't see much long-term upside in either of Buffet's plays. Of course, he's friends with the administration and has shilled for them before as token .001 percenter spokesperson for higher taxes, and in return got an indefinite delay on the XL Pipeline that favors his competing BNSF petroleum railroad operations. Perhaps he has inside information about some new EPA regulations or presidential initiative that will upset the status quo and further favor wind or lock down terrestrial drilling and domestic independent O&G operators and favor the big companies with offshore leases. It's not free market but gangland shakedown rules under the current crop of criminals in DC and the moneybags that sponsor them from Wall Street and Nebraska and Hungary.
    27 Dec 2013, 04:04 PM Reply Like
  • hornucopia
    , contributor
    Comments (143) | Send Message
     
    what happens to the off-grid folks when the sun goes down and you want to have some electricity?
    23 Dec 2013, 11:06 AM Reply Like
  • Joe_G
    , contributor
    Comments (314) | Send Message
     
    Decentralized solar generation certainly has the potential to erode the demand for electricity delivered by utilities, that's already happening now with companies like Walmart and FedEx installing solar panels on their buildings to supplement their own power consumption. However, death spiral thesis won't come to pass until two things happen: 1) battery technology improves to the point where you can store large amounts of power for long enough to cover stretches of overcast days; and 2) the efficiency of individual solar panels improves enough that large-scale users don't need vast tracts of land to generate enough power to serve industrial needs. Both of these challenges will eventually be solved on a technical level but probably not soon, and not before the regulated utilities mount some serious lobbying efforts to protect their turf.
    23 Dec 2013, 11:13 AM Reply Like
  • StepUp
    , contributor
    Comments (504) | Send Message
     
    @soxfan and horn -

     

    Solar power is stored in batteries and converters just like any other energy source. The sun does not have to be up for you to have the lights on.
    23 Dec 2013, 11:31 AM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    As Joe above states, the battery technology currently available and well into the forseeable future cannot store enough energy to fuel a steel mill or any significant manufacturing facility. Ever work in a steel and and see how much energy they use? I have. I actually had a job where I managed the usage of such energy. It is much more than you could possibly comprehend.
    24 Dec 2013, 10:15 AM Reply Like
  • MWinMD
    , contributor
    Comments (2825) | Send Message
     
    soxfan - do you approach everything in your life with this same "it's all or nothing" approach? When the road in your neighborhood isn't clear enough to do 100 mph, do you just sit in your driveway, because your speedometer has only a binary "yes/no" readout?

     

    Have you heard of distributed energy production? Are you aware there are residences, as well as steel mills? Maybe get out more?
    24 Dec 2013, 12:36 PM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    Great question. Why would anyone think wind & solar energy are all or nothing technologies? Is the concept of supplemental not an option?
    24 Dec 2013, 09:51 PM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    MWinMD, you don't understand basic science. To offer the large amount of concentrated energy needed by steel mills and other manufacturing operations, wind and solar will not do. 1) they are not reliable enough 2) the energy to be gathered to satisfy them would have to consume too much space with sun and wind farms to do so. 3) The sudden surge of energy needed by such industries during their processes could not but sustained by alternative energy sources.
    25 Dec 2013, 08:48 AM Reply Like
  • MWinMD
    , contributor
    Comments (2825) | Send Message
     
    You're talking out of your you know what. Better hurry and tell Warren Buffett's utility about "basic science" and "economics", as they are now making a billion dollar bet on wind.

     

    Knee jerk perseverating naysayers are so tiresome.
    25 Dec 2013, 11:33 PM Reply Like
  • RWCMom
    , contributor
    Comments (96) | Send Message
     
    Utility energy, like investing, is now dependent on a diversified portfolio of energy sources. While the relatively well off, educated & great handymen that own property will have their own solar on their rooftops or windmills on their property, there is a large swath of America (& the world) that will be dependent on the energy provided by landlords or homeowners associations - there seems to be little rush to make changes when cost increases are passed on to others, sadly.
    23 Dec 2013, 11:40 AM Reply Like
  • nemonemo
    , contributor
    Comments (333) | Send Message
     
    Lol. Look at what happened to Europe. Coal is back.
    23 Dec 2013, 11:43 AM Reply Like
  • User 353732
    , contributor
    Comments (5046) | Send Message
     
    In regions with egregiously high electricity prices and demographic stagnation(Bicoastal US, Illinois, Michigan) utilities are not a promising investment because they have little capacity for long term wealth creation. In other regions such as the South utilities are a very sound investment because they have organic demand growth , a favorable regulatory environment and much better customer loyalty.
    23 Dec 2013, 11:46 AM Reply Like
  • Jim Jenal
    , contributor
    Comments (36) | Send Message
     
    The answer to the reliability/availability question raised by @Abigsoxfan and @hornucopia is intelligent storage. In California, the PUC has ordered the IOUs to start investing in storage and it is beginning to become a solution - at least for leveling out demand spikes - at the individual solar client level.

     

    Over the next five years, intelligent storage will be the biggest push in the renewable energy world, IMHO.

     

    Full disclosure - I do not own stock in any company related to energy storage.
    23 Dec 2013, 11:49 AM Reply Like
  • Suspect
    , contributor
    Comments (16) | Send Message
     
    We need to come to our senses over Global Warming/Climate Change/ Carbon Taxes -- It's all a scam costing the power companies tons of money.
    Year 2000 serious article -- Snowfalls a thing of the past
    http://ind.pn/1e5Uhy8
    23 Dec 2013, 11:51 AM Reply Like
  • WPSPIKER
    , contributor
    Comments (1158) | Send Message
     
    The thesis is pretty poor, Solar is only actually good a few hours per day most of the time while no one is home (out working.) Then you talk about (FE) and (EXC) who have their biggest consumer bases in north east and northern mid-west where we get maybe 60~70 days of sun per year, you still have 285~295 days of NO SUN on top of 2/3 of the year where solar energy is very poor (winter into early spring and late fall into winter.) Without highly expensive tracking systems there is almost no primarily payback... We are talking two homes we have our electrical usage is only about 90bucks per month between the two. To power either place would require 5+KVA to dump enough power back into the grid thru net metering to even pay for our particular energy. 5KVA is only about 40 amps of useable energy at max output. That system is $12,000.00+ just for the system plus that much more to install it. Then you have to have a large bank of batteries to complement which requires regular maintenance. Something 90% of regular utility customers will not do. So basically this system is good for 5 years on the battery and maybe 8 on the electronics while the panels MAY last 25 years but by the 10th year their efficiency is down greatly.

     

    To pay back the initial costs of the components, install cost and space to install them will be pretty bad. For us estimating for ease I will say $100/per month cost, initial solar cost figuring $25,000.00 will take us about (25,000/100)/12months = about 20 years...

     

    As you can see 20 year payback for a solar system assuming it is a break even system install and no added maintenance costs such as battery replacement costs or electronics replacement costs are even added in...

     

    SO people thinking that the price of solar is cheap enough that everyone will switch is still no way even near break even vs using grid power that is on 24/7/365...

     

    Poorly contrived and totally incorrect assumptions.

     

    BTW I'm industrial electrician working on my BSEE degree so well aware of all the misc costs most people have no clue about & what utilities charge is rather fair. Biggest problems facing these companies are government rules and regulations forcing expensive upgrades without being able to pass those costs on to consumers.

     

    Mark
    23 Dec 2013, 12:07 PM Reply Like
  • justaminute
    , contributor
    Comments (910) | Send Message
     
    Pretty well sums it up. 100 years of electric generation has produced efficiency the the Solar\Wind industry will take decades to come close to.
    23 Dec 2013, 11:14 PM Reply Like
  • T. A. "Ike" Kiefer
    , contributor
    Comments (133) | Send Message
     
    The problem with wind and solar power continues to be their low value, not their cost. Value in any transaction is in the eye of the consumer. For electricity, value exists in reliably getting exactly the quantity and quality of power delivered at exactly the time and place desired. Commercial-scale wind and solar power are low energy density, low power-density, arbitrarily intermittent, non-dispatchable, geographically diffuse and generally remote, asynchronous power sources. Their inherently lower value would naturally restrict them to a niche market and command a far lower price than alternatives. However, the federal and state governments are hugely subsidizing them with tax credits and grants and RECs and must-take agreements and pricing arrangements that demand utilities pay retail for wholesale kWh, even when there is no demand.

     

    While the government can mandate price parity by socializing the true costs of these underperforming children to the adults on the grid, they cannot mandate value parity -- that is for the consumers (i.e., the market) to decide. So the fate of the utilities is really a question of regulatory risk, not inferior economics. That question is, will the US federal and state governments wise up from the examples provided by Denmark and Germany and Spain and Italy and the UK and California and Hawaii and the Northeast, which all clearly show the causal link between the penetration of subsidized wind and solar power on the grid and skyrocketing utility rates and corresponding energy poverty, or will they continue down this path of national energy folly.

     

    There are only two ways to heal this self-inflicted injury:
    1. The citizens and government wake up from their ideological slumber and rub the greenwash from their eyes to discover that solar and wind are neither clean nor green when forced to be grid compatible, and we all back off from the regulations to let the market price their true value appropriately. Or,
    2. There is a dramatic electricity storage breakthrough that improves the inherent value of solar and wind power by improving the cost-effectiveness ($/kWh) by a factor of 3 or more below pumped-hydro and the energy density (kWh/m3) by a factor of 30 or more above LiON to compete with the fuel storage footprint at conventional plants.

     

    Unfortunately, the current administration's "all-of-the-above" strategy of fire-hosing taxpayer money (and money borrowed from China, and money created ex-nihilo by the Fed) into every possible unproductive moneypit such as $59/gal biofuels and $7/watt solar farms, and $23/MWh wind subsidies, is redirecting huge amounts of capital and R&D attention from addressing the real issues of grid resilience and energy security that would both be hugely advanced by a breakthrough in electricity storage.

     

    BTW, "all-of-the-above" is not a strategy; it is the absence of a strategy. Prove it to yourself on the roulette wheel in Vegas by betting on every number. Our policy-makers have to be smarter about the scientific possibilities and limitations to make good investments in our future energy portfolio instead of just gambling away our grandchildren's birthright on projects whose criteria for selection are more political or ideological than scientific, such these examples of federal energy policy failure at taxpayer expense:

     

    Brightsource ($1.6 billion)
    First Solar ($1.46 billion)
    SunPower ($1.2 billion)
    Solyndra ($535 million)
    Fisker Automotive ($529 million)
    Abound Solar ($400 million)
    A123 Systems ($279 million)
    Babcock and Brown ($178 million)
    Range Fuels ($156 million)
    Compact Power ($151 million)
    ECOtality ($126.2 million)
    Ener1 ($118.5 million)
    Mascoma Corp. ($100 million)
    Nevada Geothermal ($98.5 million)
    Vestas ($50 million)
    Beacon Power ($43 million)
    Navistar ($39 million)
    Raser Technologies ($33 million)
    Evergreen Solar ($25 million)
    Konarka Technologies Inc. ($20 million)
    Nordic Windpower ($16 million)
    Energy Conversion Devices ($13.3 million)
    UniSolar ($13.3 million)
    Olsen’s Crop Service and Olsen’s Mills Acquisition Company ($10 million)
    Stirling Energy Systems ($7 million)
    Thompson River Power ($6.5 million)
    Azure Dynamics ($5.4 million)
    Satcon ($3 million)
    Mountain Plaza, Inc. ($2 million)
    Willard and Kelsey Solar Group ($700,981)
    SpectraWatt ($500,000)
    GreenVolts ($500,000).
    23 Dec 2013, 12:42 PM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    Thanks for the intelligent post Ike.
    24 Dec 2013, 10:17 AM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    It's ironic how one can post all this nonsense about self-inflicted injury and "absence of strategy" while completely ignoring the past 60 years of ACTUAL energy policy.

     

    Government subsidies in Solar and Wind technologies are worth every penny when compared to $800 Billion defense budgets each and every year, and the loss of American lives in part of the world where we need to keep Big Oil flowing. I learned that during the 1973 oil embargo.
    24 Dec 2013, 10:50 PM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    What does the defense budget have to do with the money wasted on Solyndra and other companies. Like any other good liberal you are comparing apples and oranges to make a poor argument.
    25 Dec 2013, 08:50 AM Reply Like
  • justaminute
    , contributor
    Comments (910) | Send Message
     
    But I thought Pelosi said there was not a dime that could be cut.
    25 Dec 2013, 08:45 PM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    So those 14 airbases we have in Saudi Arabia are free?? How about the other 41 other military bases in the Persian Gulf? Are those free too? Those don't cost the American tax payer anything - they’re not part of the $800 BILLION defense budget?? The $49 BILLION we've sent to Egypt alone - isn't use to keep the Suez Canal open for the free flow of their exported trade?? Gee, what product would that be?
    The subsidized total of all those companies listed by Ike above was $7 Billion. Well worth the price to pay when compared to sending the money overseas to keeps the Oil flowing. That, littlefan, IS comparing apple-to-apples.
    26 Dec 2013, 12:48 PM Reply Like
  • T. A. "Ike" Kiefer
    , contributor
    Comments (133) | Send Message
     
    Zero US bases in Saudi Arabia. ~$2 billion a year to Egypt to keep them friendly to Israel. ~$4 billion a year to Israel to keep them friendly with Egypt. ~$90 billion/yr for all Middle East US military operations to keep 1/4th of world's petroleum flowing to everyone including our critical allies Japan and South Korea and Australia who depend upon it for a much higher fraction of their primary energy than the 4% the US gets from the Persian Gulf. Lots of important geopolitics and about $12 trillion of international seaborne trade at stake here. Don't diminish the issues with an uniformed rant.
    27 Dec 2013, 04:18 PM Reply Like
  • DwightK
    , contributor
    Comments (13) | Send Message
     
    Like I said... $2 Billion a year to Egypt ($49 Billion since 1979), $3 Billion per to Israel, $2.1 to Iraq, and $1.7 B to Pakistan. No military bases in Saudi Arabia... and yet we've launched multiple drone strikes into Yemen from there? Even Bing finds those bases. You can tell NPR, Fox News and the BBC they're wrong.

     

    According to Reuters... the current budget for foreign is $53.1 Billion a year. Again, what's the ROI on that?? Should "our critical allies" be expected to foot more of that bill for "lots of important geopolitics and about $12 trillion of international seaborne trade" - so that we can invest in domestic alternative energy programs? Ones that we reduce the need to have a $53b foreign aid budget in the first place?
    28 Dec 2013, 11:47 AM Reply Like
  • ccpflaum
    , contributor
    Comments (9) | Send Message
     
    Utility death spiral is a reality in some geographies, e.g. Australia, but not in the US. As others have noted, most of the US population lives in dense cities and suburbs where the sun does not shine often and bright enough to make solar viable. We are clearly many years, if not decades, away from low-cost energy storage systems.

     

    The most challenging technology for utilities is the new breed of fuel cells that can covert natural gas to electricity with 90% efficiency and rather simple design. Commercialization of this technology is now on the horizon and will allow home and business owners to self-generate power for a lower total cost than buying from the grid with a higher level of reliability.
    23 Dec 2013, 02:18 PM Reply Like
  • fdavidj
    , contributor
    Comments (3) | Send Message
     
    Agree on the residential fuel cell using natural gas as a strong contender for the future. Who are the leaders in this technology
    23 Dec 2013, 09:46 PM Reply Like
  • Abigsoxfan
    , contributor
    Comments (806) | Send Message
     
    http://bit.ly/1cvtNZP
    24 Dec 2013, 10:18 AM Reply Like
  • Equitem Capital
    , contributor
    Comments (4) | Send Message
     
    Agreed that the Utility Death Spiral is a long ways off because very few consumers (commercial or resi) can get off the grid with renewables only. It's much uglier for merchant gen. What this conversation has missed is that, from the merchant generators point of view, it is not the total supply that is provided by renewables that hurts, it is the effect of renewables on pricing - particularly locational marginal pricing in competitive markets. Renewables have two negative effects on LMP,
    1. Solar tends to be most productive in mid-day. For areas with feed-in tariffs (where households can get credit for giving back to the grid) and for commercial installations like Wall-Mart, solar acts as a "peak shaver" reducing peak energy prices which is where a lot of the profit is made.
    2. Wind runs whenever it blows, which is usually at dawn or dusk, when energy demand is very low. In some areas, this has driven prices negative. If the windmill is located in the same LMP zone as a baseload plant - such as a nuke, which cannot turn off, this creates ugly losses as the nuke has to pay the grid to run. That's why Exelon changed their position on the wind tax credit.

     

    So, renewables don't have to produce a lot of power to hurt merchants. They just have to crush marginal prices. Which, increasingly, they are doing. Unless something changes, this is bad news for merchants.
    24 Dec 2013, 09:47 AM Reply Like
  • rr76012
    , contributor
    Comments (116) | Send Message
     
    Today, in America there exist variations and degrees of crony capitalism in a lot of business sectors and industries, subsidies for this, and subsidies for that, tax credits to them and them and them and not for others? Investing is getting more and more less academic and more about in investing your dollars as to which politicians get elected-in vs incumbent politicians who get elected-out.

     

    It is getting harder and harder to differentiate the Government Motors and AIG's from the rest of the investment world...Remember as of today, now the government controls 1 / 6 total of the USA gdp by the way of obamacare, WH now basically running the health sector .In 2014, now add the insurance industry to govt control, that is tied to obamacare more and more...

     

    Remember for years now the FOMC voting members have been buying 75% of the issued treasury debts. Bond vigilantes and fixed income retirees have had just about enough of zero interest rates and now ready to rebel against quasi govt bureaucrats the fomc voting members. FOMC voting members behaving like the supreme court judges legislating without ever being elected into any office.

     

    I think the FOMC voting members have been the best and worst ally to the utility industry, with the blessing of this current WH administration. Currently most investors seeking dividend income had turned to the utility sector for it's supposedly stable nav price and high dividend yield. In 2014 investors will probably turn to other sectors, industries and fixed income for the same 3.00-4.00% yield.

     

    For the Utility sector, now the worm has turned, basically the bond vigilantes, on the longer term maturity bonds have been dismissing the fomc members zero interest rates and qe products more and more and more. Utility dividends are not safe, payout ratios are higher ect...

     

    Higher interest rates from the bond vigilantes will be a bigger and bigger competitor for investor dollars as rates rise. The average 3.00-4.00% dividend yield is soon not be dominate.

     

    Utilities in 2014 are going to have to get back to basics, good financial management, good investment and debt decisions to be competitive for investor dollars, if not then they will not be as competitive. We will see in 2014.

     

    To all Merry Christmas, Happy Holidays and Happy New Year...
    24 Dec 2013, 11:19 AM Reply Like
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