The media never misses the opportunity to warn us of impending climate disaster. Every hurricane or snowstorm is reported as evidence of the urgent need to switch to renewable energy. Solar, in particular, is presented as the answer. But is it?
Since 1979, the federal government has invested over $100 billion in solar initiatives and over the last year, the MPSC has approved an additional $531 million worth of panels.
Compared to 20 years ago, the cost of solar panels is significantly cheaper, largely a result of their enhanced performance. And yet, solar sums still do not add up, and nowhere is the gap more glaring than right here in Mississippi.
For all the millions of dollars invested in solar power in Mississippi, right now solar only produces a fraction of our total energy needs. 97% of non-carbon energy comes from nuclear power plants and 0.7% of energy is solar-based. To transition to renewable energy, the state would have to duplicate the productivity of the Grand Gulf Nuclear Station 49 times.
In order to replace the electrical output that comes from just one of Mississippi’s nuclear power plants, we would need much more than a couple more solar farms. In fact, we would need 21,000 acres of land dedicated exclusively to solar panels.
“But why not just build more solar farms, like the one in Sunflower county?” I hear you say.
Because we would need to cover 1/10 of Mississippi land with solar panels to move entirely to renewable energy. That’s about 1,050,000 acres of land. This would not only be a major economic sacrifice but also an environmental one.
What this means today is that any initiative that entices or requires Mississippi’s energy producers to generate power from sources other than coal, oil or gas is going to be more expensive. No amount of federal subsidy can conceal the fact that that additional cost will eventually land on the consumer.
“Hold on!”, some will say. “Isn’t solar energy actually less expensive than the alternatives?”
If you take a superficial glance at the prices paid today, that might be true. It is certainly a point that the solar lobby likes to make. To produce a mWh of electricity using nuclear power costs $69.39, using coal it costs $72.78. The average amount changed to produce the same amount of power from solar? A mere $32.78.
But there are a couple of catches. For a start, solar power requires having significant storage capacity (there is no sun at night). Once you factor in solar power from a battery storage source, the per mWh cost rises to almost $120.
At the same time, the price that is currently paid for solar is not necessarily a market price. It is more the product of a ‘cost plus calculation’ of what the producers should pay that it is a market determined price. Take away the various subsidies, soft loans and tax credits that the state and federal government gives to solar producers, and solar ceases to look like a low cost alternative to coal, gas or nuclear.
Right now, Mississippi is one of a handful of states that does not have a ‘Renewable Portfolio Standard’. That is to say, we do not have a formal target, that requires energy producers to switch to renewable sources by a set date.
This is fortunate, given that a study by the University of Chicago recently found that states with renewable portfolio standards witness skyrocketing electricity prices. “Rates increased by 11% when the share of renewable generation increased by 1.8%, and by 17% when the renewable share increased by 4.2%.”
If we want to face a similar fate as Texas during the 2019 heat wave, we should definitely switch to solar energy.
In 2018, a year before the heat wave, 5,000 mW of traditional energy was decommissioned. Then the heat wave hit, and the low, subsidized price of $20 per MWh, which scarcely made it worth producing power, skyrocketed. On the morning of August 13th, 2019, electricity prices went from $20 per MWh to $9,000 per MWh by the afternoon.
If Mississippi expands solar production through subsidy and tax breaks, a similar scenario will await us.
Douglas Carswell is President & CEO of Mississippi Center for Public Policy.