Better ways to spend $100 billion

The $100 billion, 22-year projected cost of the proposed California High Speed Rail system should be enough to kill it. But this week, Governor Brown vested his full support — and personal credibility — in this project, hoping to persuade (or overrule) the sentiments of a majority of the state’s voters.

I am a transit fan, second to none. I spent college taking pictures of mass transit systems in Boston, Washington and San Francisco. The one success of my (brief) career as a UPI photo stringer was a picture of the inauguration of the San Diego Trolley that ran on the front page of the San Diego Union. I’ve ridden high speed trains in Japan and Europe, including the Eurostar from Brussels to London. And — unlike most Americans — I’ve even taken cross-country Amtrak trains overnight, both with and without a sleeping car.

Still, $100 billion is a lot of money for one state to cover. That’s assuming that the system could be built for this price, even though major public works projects always run over budget (cf. the “Big Dig”).

Even if an electric train generates less pollution than an internal combustion engine car, is it necessary to put down a $100 billion bet that the system will be economically viable?

Charles Lane of the Washington Post thinks not:

On the merits, high-speed rail would be a questionable investment even if California could afford to build it.

…[B]oosters marvel at bullet trains in Europe and Japan, insisting simplistically that we need them, too.

But the sprawling, decentralized cities of the United States do not make convenient destinations for train travelers. International experience shows that high-speed rail entails expensive debt service and large operating subsidies. This would likely be the case here as well, since, for better or worse, rail must compete with well-established air and car options. Business travel is one ostensible purpose of bullet trains in California, but increasingly people meet via video conference.

For these and other reasons, high-speed rail in the United States would lower carbon emissions and reduce traffic far less cost-effectively than would alternative solutions.

In the past decade, videoconferencing has made huge strides in replacing business travel. No transit system — in fact, nothing short of teleportation — is going to be able to compete with videoconferencing for efficient use of time for short meetings.

Meanwhile, as Lane says, are there budget priorities that could improve the state’s environment far more cost-effectively? The California Solar Initiative is a $3.35 billion cross-subsidy (1/30th the cost of the CHSR) by electricity users that has already brought the installation of more than 1 gigawatt of renewable energy capacity for the state.

In Memoriam: 2011 solar shakeout victims

As part of updating a research paper I’m writing on solar policy, I’ve been catching up on the state of the solar business. (Regular readers will note that since I joined KGI, I’ve been paying a lot more attention to biofuels).

To start, I thought I’d look at all the solar firms that died (or otherwise were mortally wounded) in 2011. I traced down the announcements of the firms mentioned in various stories, and here is what I found:

Company	HQ	Stock	Tech-nology	Date	Action	Current Status
Soliant	Monrovia, CA	private	CPV	Mar. 29	Liquidated	Liquidated for 1.5¢ on the dollar
Evergreen	Marlboro, MA	ESLR	ribbon Si	Aug. 15	Chapter 11	Liquidated
SpectraWatt	Hopewell Junction, NY	private	Si	Aug. 19	Chapter 11	In liquidation
Solyndra	Fremont, CA	private	thin film (CIGS)	Aug. 31	Chapter 11	Liquidated
Stirling Energy Systems	Scottsdale, AZ	private	thermal (Stirling engine)	Sep. 23	Chapter 7	In liquidation
Solon AG	Berlin, Germany	SOO1.F	Si	Dec. 13	Insolvency	Seeking a buyer
BP Solar	UK	(division of BP)	Si	Dec. 20	Announced plans to close	Winding down
Solar Millennium AG	Erlangen, Germany	S2M.F	CSP & PV solar farms	Dec. 21	Insolvency	Selling solar farm projects

Most of these were solar system manufacturers, making panels, tubes (Solyndra) or stand-alone thermal generating dishes (Stirling). The mainstream companies (like SpectraWatt) might have IP that’s useful for other PV companies, while the oddball companies (Evergreen, Solyndra, Stirling) had unique technologies of little or no value to other firms.

BP Solar’s decision to get out of PV marks the latest realization by oil companies that biofuels (not solar) fit their existing business model. I hope to blog on this another time.

Solar Millennium is unique in that it was a large solar farm developer, and thus its projects (if they still make economic sense) might be bought by other companies. One of its largest projects is the 1 gigawatt Blythe Solar Power Project that won a $2.1 billion loan guarantee from the DEO and was praised by DOE Secretary Steven Chu and California governor Jerry Brown. It appears that the Blythe and other US projects are being sold by Solar Millennium’s majority owned US subsidiary to SolarHybrid AG.