Price of fuels just part of energy debate

Don Reid, Las Vegas

Wednesday, Dec. 29, 2010 | 2:04 a.m.

The Las Vegas Sun’s Thursday article, “The one unknown about proposed solar field: Cost of energy,” stated: “One expert told the Sun that solar power is far more expensive to generate than electricity from plants relying on coal, natural gas or geothermal energy because of the higher costs of solar technology.” I’ve been involved in financing and developing renewable and conventional energy projects for more than 25 years, and I believe, except for geothermal, that statement is false because:

1. The market price of carbon fuel excludes the cost of its externalities — the costs to our health, land, wildlife and water caused by the release of carbon dioxide, sulfur dioxide and nitrous oxide, and toxic substances such as mercury, arsenic, lead, selenium and vanadium. It is the old story of a factory dumping pollutants in a river, killing fish and poisoning land. The factory and its owners benefit, but who pays for the damage done downstream? Solar, although it may not be perfect, has comparatively few negative externalities. A simplistic price comparison of fuels reflects an inherent weakness in our economic system — reliance on market prices as the overriding driver of what is good for our state and country in the long run.

2. The price of carbon fuels does not incorporate the benefit of price certainty and fuel availability. A solar plant, large or small, may be more costly initially but is less costly in the long run because its fuel is free, sustainable and unlimited. While the price of carbon fuels may vary widely and wildly, the price of solar electricity is predictable, steady and reliable.

We need stability in our fuel mix. We cannot be overreliant on any single source of energy. The benefit of fuel diversification and price certainty is lost in a direct, short-term comparison of prices. Do we have the foresight, political will and wisdom to invest in the future and think beyond myopic, short-term strategies?