This is one of the most comprehensive looks at the impact of solar energy on a populace, economy, and grid infrastructure. It demonstrates the folly of embracing renewable energies. It also demonstrates how the incentives for creating these things have a tremendous cost. The measure of success for the PV industry comes at the expense of every aspect of society. The comprehensive nature of the article doesn’t allow for me to recap. I don’t expect any leftist to understand what the author is stating. It simply addresses concepts too foreign to a econut. The thoughts are beyond their capacity to understand. But, for the rest of us, here are a few highlights of the article…….. It is well worth the read.
In terms of investments, Italy’s experience with solar power is definitely a success. According to the European Photovoltaic Industry Association (EPIA), Italy was the world’s top photovoltaic (PV) market in 2011, with 9.3 GW of newly installed capacity. At the end of 2011, the amount of installed PV capacity worldwide was 69.7 GW, of which 51.7 GW in Europe and 12.8 GW in Italy.
In 2003, Italy introduced a 20-year feed-in tariff, the “primo conto energia”, which entered into force on 19 September 2005. Thanks to the generosity of this subsidized tariff (which could be as high as €490/MWh for large solar plants, vis-à-vis an average energy price on the day-ahead market in 2005 of €58.59/MWh) the first energy law was a resounding success.
But PV producers had found a very convenient legal loophole. In 2010 legislation had been passed (the so-called “decreto salva Alcoa”, named after the failed attempt to create conditions for the aluminum producer Alcoa not to shut down its factories in Sardegna)……..
To produce aluminum, one needs a tremendous amount of electricity…..
To make a long story short: by the end of 2011, 12,750 MW of PV power had been installed. This time the cost of incentives became definitely too high to be ignored: more than €3.9 billion in one year. This amount will further increase in the next few years, although not as fast as in the past.
This is from a country which it teetering on bankruptcy. The article continues on about grid congestion. The laws mandate that when solar energy is available, it must be used. Given the subsidies, this means they can undercut the traditional providers. It also highlights that in spite of all of this activity, PV only accounts for 3% of total electric production.
Given the country’s economic outlook and the strong correlation between electricity demand and economic growth, it is unlikely that consumption will grow significantly in the foreseeable future – or that it will grow at all. At the same time, the amount of non-marketed (subsidized) energy is growing, which displaces conventionally produced power and creates a gloomy scenario for its producers as the size of the “contestable”part of the market is shrinking.It fell from292 TWh in 2007 to 248 TWh in 2011 (-15%).
The author concludes with this thought…..
All in all there seem to be no easy solutions and, perhaps, no solution at all, except that many people will have to pay for the defects in the system – be they consumers, conventional producers, or even, in the future, renewable energy producers. But at least the Italian experience may provide a useful lesson: policies aimed at changing the structure of the power system too rapidly may ensure that targets are met, but not necessarily in a way that is consistent with the “public interest“.
They’ve painted themselves into a grim corner. They need to honor the commitments they have, else risk loosing investors. But, they’ve little money to do so. Further, this restricts economic growth. Still worse, the high cost of the electricity will continue to extract wealth from the populace. Italy should serve as a stern warning for all nations seeking to embrace solar energy.
suyts space 
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I talked to a friend from Hamburg today who just managed to get a 10 mill EUR solar project in Greece going.
Through all this “austerity” and near-bankruptcy of the PIGS, the solar and wind juggernaut keeps on misallocating capital…
Currently the mandated feed-in tariff in Greece is 34 Eurocents/kWh; approx twice of the German feed-in tariff – even though they have twice the insolation and therefore should be able to make do with half our feed in tariff… that’s about 42 US cents a kWh… for an unreliable power source, guaranteed, probably for 20 years lifetime.
The Eurozone is a madhouse, and very predictably so. Which is a good thing. I’m optimistic we will see more pain in the next 3 months. I need stock prices to come down.
He told me more mad stories from the renewables sector. Painters sitting in containers for two weeks, waiting to be shipped to offshore wind turbines to coat them in anti-corrosive paint. Offshore wind is even more expensive than solar. As the North sea weather is most of the times not suited for this kind of work they just sit there, getting paid, then, after 2 weeks, get 2 weeks of free time until the next shift of waiting in the container begins.
Finally some day., they might actually get to work and paint those towers… by hand. With their brushes. Yeah, great way to produce energy. The mind, it boggles.
This will all end in a very bad way. Utter madness is what is happening. Austerity is a fiction, they refuse to attempt it, and everyone refuses to enforce it. But nearly everyone says this is what they’re doing.
Well, there is an objective reality out there and it is striking back. Italy has billions of debt and allows itself to pay 3.9 billions eur yearly on a solar energy production which is not adding anything to its competitiveness, efficiency, not improving the life of its people and not securing any energy security.
2012 the amount will increase whilst Italy will have to fight its deficit. Same as Greece and Spain.
All these discussions should have taken place before the investment, before the feed-in tariffs. It is strange to see how long do people need to face and accept reality.
Will be interesting to follow-up how this will evolve and how long will it take until these reality deniers will have to face it?
Europe itself will have to face a heavy billions green-parasitic industry for many years to come. The pain is to think what could have been done with the money. The Large Hadron Collider in CERN was 3 billion eur. The fusion research is 20 billions. The previous century saw the development of Concorde, the “Chunnel”, the french TGV, investments in infrastructure, nuclear plants and many more.
This century windmills and solar panels, and even worst, binding money to it through 20 years contracts.
It’s a difficult position to be in. But, at some point, they’ll have to address throwing money away in this manner. They should immediately act to start undoing what they’ve created, but, you’re right, for years to come, this will work to their detriment.
The article you mention should be MANDATORY reading for ANY ELECTED OFFICIAL at ANY GOVERNMENT level when it comes to considering ANYTHING about pushing renewable energy. Oh, and that pesky issue about ‘climate change’ or is it ‘global warming’ again because of the heat wave in the US . . . ?
The first Tuesday after the first Monday in November can’t come soon enough . . .! 🙂
PS: I am starting to read your blog more . . .
No doubt. It should be mandatory. And thanks, and welcome!
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People are told to have clean energy with zero carbon emission. With all the facilities included. Aircon, wash machines, illumiunation, tv, etc.
This is a way to have it- wigh somebody else to pay the bill.
Of course one could survive without air conditioning, people in the past did. But this would immediately create a drop in GDP. Not much is accomplished during the hot and humid hours, in places like the mediterranean or in the south of the US.
In fact, before the invention of the A/C, people in the US were convinced that the North would stay the industrialized powerhouse while the South would stay an agricultural backwater. A/C totally transformed what was possible.