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The profitable nature of solar power in Spain has given rise to strange installation locations, such as this plant which towers over a cemetary.  (Source: AP)
Spain has found a controversial way to boost solar adoption

When it comes to solar power, the real dilemmas are efficiency and cost.  On the one hand, efficiency has steadily improved over the last couple decades to the point where it’s approaching the utility prices of other power generation methods.  Exotic technologies promise even greater gains.  However, the price of solar-generated power still remains at least five times as expensive as coal-power, the chief source of power in the U.S. (compared to the leading candidate, nuclear, which is approximately 1.5 to 2 times as expensive).

While solar adoption from a cost standpoint is unattractive, there's much debate over whether commercial adoption is needed to spur further research to propel solar into the realm of cost competitiveness.  While many nations like the U.S. and China have modestly taken this position, adopting solar at a moderate rate, one nation has fallen head over heels for solar -- Spain.

Spain is allowing solar and wind power plants to charge as much as 10 times the rates of coal power plants, making it possible for solar power installations to earn utilities big money.  On average, recent rate increases have raised solar charges to over 7 times the rates of coal or natural gas rates.   The costs are added onto consumers' power bills.

The results are mixed; while Spanish power bills are at record highs, the number of deployments is soaring.  Spain has 14 GW of solar power, or the equivalent capacity of nine average nuclear reactors, under construction -- the most of any nation.  Florida’s FPL Group Inc. and French Electricite de France SA are among the many jumping to build in Spain.

Gabriel Calzada, an economist and professor at Rey Juan Carlos University in Madrid, states, "Who wouldn’t want to enter a business that’s paid many times more than the market rate, and where the customer is guaranteed for life?"

By 2009, 42 percent of Spaniards energy bills -- approximately 95 euros ($127) on average -- will be provided by alternative energy.  Spanish law requires power distributors to buy all clean energy produced in the first 25 years of the plants' lives.  The government also recently raised the rate of Spain believes this sacrifice will pay off as fossil fuel resources become depleted and emissions standards tighten.

Karsten von Blumenthal, an industrial analyst at Hamburg-based SES Research GmbH states, "The guarantee is more attractive than what other countries offer.  Actually the U.S. has better space for solar, in the deserts of California and Nevada."

The U.S. meanwhile is also advancing thanks in part to President Obama's solar initiatives passed earlier this year as part of the federal stimulus legislation.  Over 6 GW of capacity is planned for the U.S.

Fred Morse, an official at the Washington- based Solar Energy Industries Association trade group and author of the first report to the White House on solar power (1969), says that the U.S. needs to adopt more incentives if it hopes to catch Spain.  He states, "The incentives, if implemented promptly and effectively, should greatly facilitate the financing of these plants."

One promising benefit of the Spanish solar boom is that it is increasing the number of plants utilizing new, potentially more efficient technologies like solar thermal or sterling engines.  Spain is limiting the number of photovoltaic plants (solar panel-based designs), but is giving out unlimited licenses for solar thermal and other alternative plants.

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RE: Charging more for Solar
By ice456789 on 5/13/2009 9:42:03 AM , Rating: 4
Maybe not, but once adoption is high enough I'd hope the government would repeal the allowance of charging up to 10x coal based power and bring prices back down.
In a perfect world, you're right. But in this world, no government will deprive itself of a large source of revenue unless forced to by the populace. Vague promises of 'reducing the fees back to normal once the technology is adopted' will never be followed through. It reminds me of a situation near my house. 30 years ago they built a highway, and they acquired funding by promising a toll system. The toll system would have to be voted in by the people so in order to get passed, they promised the tolls would be removed and the highway would be free once the highway was paid for. Now, 30 years later, the highway has paid for itself many times over, and the tolls have just instituted yet another rate hike. The excuse? The highway is not 'done yet' (but the only work that is going on is adding electronic tolls). A small portion of the tolls goes to maintenance and expansion of the highway, but the vast majority goes to the government to spend how they wish. It will be the same with this solar energy rate hike. 10 years from now it may change if the Spanish people realize that they are paying a lot more than their European neighbors for the same product.

RE: Charging more for Solar
By 440sixpack on 5/13/2009 5:50:41 PM , Rating: 3
Hmm, that sounds like the Mass. Turnpike to me... :-)

RE: Charging more for Solar
By lco45 on 5/14/2009 1:49:39 AM , Rating: 2
Or the Harbour Bridge here in Sydney.
$4 at peak times! Thieves!

RE: Charging more for Solar
By MrFord on 5/14/2009 11:27:10 AM , Rating: 2
Or the Harbour Bridge here in Sydney. $4 at peak times! Thieves!

Lol. Come to New York. 8$ for George Washington Bridge, 10$ (soon 11$) for the Verrazano.

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