Is Solar Too Expensive? Critics Cite Cost Per Unit of CO2 Saved

Image credit: Clownfish

No sooner do we hear about the massive growth in UK solar jobs as a result of feed-in tariffs, than others start asking questions about the viability of such policies. George Monbiot has already labeled the feed-in tariff a "rip off", and a subsidy for the well off, and now a new report offers some numbers that may back up his view. So are micro-renewables just too expensive when it comes to the cost of emissions savings?Robert McIlveen of the Policy Exchange, writing over at The Guardian, explains how his organization looked at numerous policy options for cutting CO2—assessing them specifically for the cost per unit of emissions saved. The results were, apparently, not favorable when it comes to micro-renewables:

"Policy Exchange's recent report, Greener, Cheaper, examined current CO2 emission reductions policies on the grounds of, among other things, cost-effectiveness. The subsidy for micro-renewables came out as by far the most expensive policy we looked at - by the government's own figures, it costs £460 for every tonne of CO2 saved, on average. That compares with the EU emissions trading scheme which costs around £12-15 for every tonne at present. Even the subsidy for large-scale renewables is a third of the cost - and that has often been criticised for being far too expensive."

It might be hard for many of us who have championed renewables, and specifically micro-renewables, to admit—but McIlveen has a point. Given the vast amount of opposition still out there to action on climate change, and given the huge challenge at hand, we would do well to expend our resources as efficiently as possible to achieve the cuts necessary. Solar panels may be attractive, sexy, and even extremely useful in many circumstances—but we would achieve much faster emissions cuts if we subsidised an army of caulkers, insulators and energy auditors to descend on every home in the country first.

That's not to say there isn't some value in supporting micro-renewables. After all, they are a relatively young technology, and like the computer before them, should come down in cost dramatically once certain economies of scale are reached—and technological breakthroughs achieved. Just as the development of highways, rural electrification and yes, the computer, were once stimulated by big Government spending—so too it makes sense to nurture new and promising industries that can help dig us out of the CO2-shaped hole we are in. But this shouldn't be the central plank of our strategy to cut emissions.

I still want my shiny new solar panels. And I'd still love for some policy help in getting them. But as a tax payer and a homeowner, I must admit it would make more sense for the Government to help me seal my crawlspace, and then move on to my neighbors' ducts.

Tags: Alternative Energy | Economics | Renewable Energy | Solar Power | United Kingdom