FIT ≠ solar

A highly misleading article entitled "Calm the Feed-in Frenzy" has been published over at Renewable Energy World. The article is so bad it is not really worth commenting on except in one respect: it conflates feed-in tariffs with feed-in tariffs for solar power, which a lot of people do.

You can see it coming near the beginning, when FITs are described as providing "returns from generating renewable energy from buildings." Nothing of the sort is true, not even for solar; rates are paid regardless of whether buildings are involved or not. If you put up a wind turbine on a hill, a biomass unit inside or outside of a factory building, or solar power on a roof or in a field, you get paid for the electricity you generate.

Things get even sloppier later:

Feed-in tariffs were introduced in Germany in 1999, offering index-linked payments of 51 euro cents for every KWh of electricity produced. The popular programme was met with a whirlwind uptake. By 2005, renewables already accounted for 10% of electricity in Germany, 70% of which was supported by feed-in tafiffs (sic).

Actually, no -- Germany has never had index-linked feed-in tariffs (meaning that they are not adjusted for inflation). And the feed-in tariffs that went into effect in 2000 (and were voted on in 1999) were only 51 euro cents for the most expensive type of solar power. Less was paid for large solar arrays in the field, and the solar rates for just about everything else were around 10 cents, which was significantly below the retail rate at the time (meaning that all types of renewable energy aside from photovoltaics had already reached "grid parity").

Then comes this really mind-bending analysis:

The bubble in Germany stemmed from the government doubling the rate at which the feed-in tariff decreases year-on-year (by between 5% to 10% depending on the size of the installation) just over a year ago. Reductions in the cost of raw materials and the ensuing over-supply of solar panels contributed to a 25%–30% reduction in the price of building a solar farm, but with no equivalent reduction in the feed-in tariff, the market suddenly promised huge returns for anyone opening a solar farm before the end of last year.

It seems that, for the first time in history, a bubble was created when a government doubled rate reductions. The author makes no mention of the largest economic crisis since 1929, which drastically affected all markets everywhere. Indeed, other policies to promote renewables were also affected; in the US, tax incentives are a common mechanism, and they suddenly proved completely ineffective because companies had insufficient profits to reinvest and write off. And in fact, Germany has responded by adopting lower rates, which go into effect on July 1 (see my previous post).

And then this self-proclaimed "solar energy analyst" provides this insight:

However, too many countries have implemented feed-in tariffs in a piecemeal way and have adopted levels of subsidy that have been unrealistically high, resulting in huge profits for investors and the creation of conditions in which speculators have rushed to build renewables infrastructure purely for the short-term returns.

Which countries?

The article is terrible in so many ways that I do not have time to go into everything, so let's just focus on the author's final conceit:

But how many markets must collapse before more purposeful regulations are introduced to prevent this?

I don't know, maybe you can tell us first how many markets have collapsed? To my knowledge, only the Spanish solar market collapsed, and the question is whether that is a FIT problem or a Spanish problem or a photovoltaics problem (or some combination).

According to Miguel Mendonca, the great collector of global FIT statistics, some 50 countries have FITs, and I don't hear many reports about problems anywhere. The Spanish wind market did not collapse while its PV market was collapsing, and contrary to some reports the German PV market - far from collapsing - is certain to set a new record this year.

So let's make a crucial distinction from now on: feed-in tariffs are not just for solar power.

The mood at Intersolar on Bundesrat opposition

I returned from Intersolar on Wednesday night. One of the hot topics there is the decision by the Bundesrat to oppose the proposed rate reduction for solar power scheduled to take effect on July 1.

Essentially, the Bundesrat - a sort of "upper chamber" of Parliament which represents the interests of the individual German states (there are 16 of them) - vetoed the rate reduction even though it has no power to do so. According to all of the reading I have done (see this for instance), the Bundesrat merely forced the Bundestag (the "lower chamber" of Parliament which actually has the power) to take another vote on the matter.

The lower chamber is, however, currently in recess and cannot respond to the upper chamber's veto before July 1. Nonetheless, the lower chamber merely needs to take another vote for the rates to go into effect, apparently even retroactively. For instance, if the lower chamber were to adopt exactly the same new policy in mid July, everything could retroactively go into effect as of July 1.

It therefore seems that the upper chamber's opposition is merely symbolic.

Nonetheless, people at Intersolar were hopeful that some tweaking might still take place. For instance, the rate reduction might be reduced from 16 percent to 10 percent, and the ban on solar arrays on farmland might be lifted. And indeed, a meeting is scheduled to take place on June 16. But don't hold your breath -- it seems that no negotiation is necessary.

Woodward practices "access journalism"

I recently expressed my doubts that the Washington Post was practicing investigative journalism when it reported on Watergate. Now, I see that a former colleague of Woodward's agrees; she says he was practicing "access journalism" even when publishing leaks from Deep Throat - just typing down what powerful insiders tell you, not questioning it and getting the story they are trying to hide.

Operation sombrero

The Guardian gets more facts wrong

I grow weary of fact-checking for the Guardian, but in an otherwise fascinating article about oil spills in Nigeria, we find the following inaccuracy:

... the Niger delta supplies 40% of all the crude the United States imports and is the world capital of oil pollution.

That's blatantly wrong, as you can see from the official statistics from the US government here. Nigeria as a whole provides closer to 7-8 percent of all the crude the United States imports. The Niger Delta is entirely within Nigeria, so there is no other country that contributes to the figure for crude from the Niger Delta.

Overall, Nigeria is far behind Canada (in first place) and Mexico (generally in second place) as a crude supplier to the US. Nigeria generally vies for third place with Saudi Arabia and Venezuela.

The unfortunate thing is that when you see such an obvious inaccuracy, you doubt the rest of the article.

Watergate involved investigative reporting?

Over at the New Yorker, Steve Coll expresses his concern about the future of US journalism:

... how did we end up in a society where Williams College has (or had, before September) an endowment well in excess of one billion dollars, while the Washington Post, a fountainhead of Watergate and so much other skeptical and investigative reporting critical to the republic’s health, is in jeopardy?

I've got a different question, Steve: how did we end up with journalists who believe that the Washington Post did investigative reporting pertaining to Watergate?

... as Watergate unfolded from 1972 to 1974, media revelations of crimes and political misdeeds repeated what was already known to properly constituted investigative authorities. In short, carefully timed leaks, not media investigations, provided the first news of Watergate.... Watergate prosecutor Seymour Glanzer says that what really mattered – both legally and politically – was Nixon's failure to destroy his incriminating tape recordings, not the media's coverage: "Woodward and Bernstein followed in our wake. The idea that they were this great investigative team was a bunch of baloney." (source)

Basically, Woodward was a local reporter, and when the Washington Post was notified (!) of a burglary in town, this is how things happened in Woodward's own recollection:

... it looked like a local burglary at the Democratic Headquarters, a police story. I covered the night police beat. It was a Saturday morning, I think the summer. Editors looked around and thought, "Who could we call in? Who would be dumb enough to work on this story on a Saturday morning?" And they thought of me immediately.

Otherwise, Woodward seems to have merely written down what Deep Throat, his informant, told him, much as he simply wrote down what prominent people told him in his later books. Here's another question for you, Steve -- if Watergate is such a great example of investigative journalism, has Woodward revealed anything through investigative journalism since? It's been over 35 years...

English misreports of German President's resignation

Germany's President Horst Köhler resigned yesterday in a move that took everyone by surprise, but reports about the event in English are misleading. To take just a few examples, the Financial Times writes, "German president Horst Köhler added to the pressure on chancellor Angela Merkel yesterday when he resigned over his contentious remarks that the country's military effort in Afghanistan protected German commercial interests." But that did not happen at all. (Doesn't the Financial Times realize that there's not much to be had in Afghanistan economically?)

On a trip to visit German soldiers in Afghanistan, Köhler did comment that the German public is gradually coming to accept the concept of the German military protecting the country's economic interests abroad (I italicize "German public" because this aspect has been under reported in English). His political opponents then expressed outrage at the announcement that the mission in Afghanistan might be primarily economic, which was not the goal originally stated (it was originally about the war on terror and spreading democracy). Köhler's office then cleared up the matter by stating that, although the comment had been made in Afghanistan, the statement did not apply to that particular mission, but rather to the role of the German military in general.

But those facts did not stop the Economist from writing the misleading headline "Germany's president resigns after ill-chosen remarks about the war in Afghanistan."

The political opposition was then outraged at the notion that the German military might be serving at the behest of German industry, and there were charges of imperialism. The governing coalition largely failed to support Köhler over the weekend, and the man turns out to be a bit of a lightweight, so instead of standing his ground and taking part in a Democratic debate, he nearly broke into tears when announcing his immediate resignation.

So the claim was first of all not made about Afghanistan; second, Köhler was not so much saying that this is the way things should be, but that the public was coming to accept the use of German military force in purely economic matters (such as pirate ships, though Köhler was too daft to give an appropriate example); and third, no one prominent ever called for his resignation to my knowledge -- in fact, everyone on the opposition is completely flabbergasted because no one was even considering his resignation.

So when the Guardian writes, "But those whose loud voices called for his head are now part of the problem and will never contribute to the solution," they should do us the favor and tell us who actually called for his head.

For the record, here is my translation of the spoken word (which I have tried to render faithfully, including the rambling) that got him into trouble (the German is also posted below):

I believe we, by which I also mean the general public, are generally on a path to understanding that a country of our size, with our focus on foreign trade, is also dependent upon foreign trade, so we also have to realize that in cases of doubt, in cases of emergency, military force is needed to protect our interests, such as free trade routes, such as the prevention of instability over entire regions, which would certainly detrimentally affect our opportunities to protect our jobs and income through trade.

Meine Einschätzung ist aber, dass insgesamt wir auf dem Wege sind, doch auch in der Breite der Gesellschaft zu verstehen, dass ein Land unserer Größe mit dieser Außenhandelsorientierung und damit auch Außenhandelsabhängigkeit auch wissen muss, dass im Zweifel, im Notfall auch militärischer Einsatz notwendig ist, um unsere Interessen zu wahren, zum Beispiel freie Handelswege, zum Beispiel ganze regionale Instabilitäten zu verhindern, die mit Sicherheit dann auch auf unsere Chancen zurückschlagen negativ, bei uns durch Handel Arbeitsplätze und Einkommen zu sichern.

Horst, couldn't take the heat, so he got out of the kitchen. In a democracy, people get to debate things, so if you say something, you may get criticized. And if you say something stupid, you will be criticized more. And if you're not good with words, you will say stupid things more often.

May the next German President know those simple facts.