Solyndra (the solar energy company–website here) and the federal government’s loan guarantees have been in the news recently. Some are taking this as a debunking of alternative energy as a source of electricity. We at Achievable Solutions, Inc. remain positive on alternative energy, especially biofuels, as a part of West Central Florida’s economic development future. We are not able to calculate a way to make wind or solar economically efficient out 5 to 20 years, but we can most assuredly put together a package of fiber-to-biofuel that competes favorably with clean coal for electrical generation.
The Solyndra case had three problems that are not shared by biofuels:
1. Solyndra was facing cut-throat competition for their product. Competitors were able to successfully undercut their prices. The advantage of biofuels for the time being is that they are unique products that have to have custom designed biodiesel engines for that particular product. You can’t just substitute one product for another in the generator, you have to completely redesign it to accept a different product.
2. Solyndra was relying on government loan guarantees. This is one of the worst government economic development products there are: it socializes the risk, but leaves the profit in the hands of the entrepreneur. Where was the up-side for the federal government, here? And where was the down-side for the investors? Who can make a rational economic decision if they get all the benefits, but someone else pays all the cost? Not that I can blame Solyndra for taking the guarantees, I must say. However, if a government wants to become a Venture Capital firm, then it needs to follow the model of successful VC firms and take a significant portion of the profits. The companies we work with on biofuels do not rely on similar incentive products: yes, it often takes relief from property, tangible property, and corporate taxes to make the final product profitable, but that’s what’s offered to any firm moving or expanding operations in a community.
3. From a power capacity perspective, biofuel-generated electricity is a more reliable product. Solar (and wind) is limited to certain times of the day, week, and year that it can generated electricity; a biofuel operation can operate 24 hours per day all year long at a constant output leading to more efficient capitalization of the investment and more reliable capacity.
By the way, if someone can demonstrate a viable solar or wind plant that does not require heavy subsidies (ones I’ve seen need some multiple of the negotiated power purchase agreement price), we are ready to find a location for you. Contact us at 352-527-9003 or by email at email@example.com.
At the end of the day, no matter what happens with Solyndra and solar energy, in general, municipal waste to energy and wood waste to energy appear to us to be very good products with a bright future in Florida.