Sunday, March 4, 2012

Bring the money, everything else will follow

Financing the second decade of the century

Energy and Banking are the grease of the American economy. When I entered the solar arena I had no idea how truly integrated our economy was. The federal govt is critically woven in the fabric of the private sector and vice versa. Consider that without the US military fossil fuel transportation and mining likely could not happen at a scale to support our current needs. Or without the underwriting of Nuclear plants there would not be a 20% energy infrastructure based on Nuclear energy. Of the five largest nuclear research facilities in the US all are federally funded.

Fluor, which is a huge construction company with major offices in SC, had its CEO attend the SC energy and jobs forum that I attended. He is likely a very savvy CEO but he said that the federal government should have less direct impact on the private sector. On the surface this is a wonderfully Ayn Rand concept, until you look at Fluor’s, client list; US Army, Afghanistan, Camp Adder, Iraq, CETAC I and CETAC II which has no budgetary numbers attached to it, but the 22 tasks are all encompassing. I would expect billions of dollars in taxpayer contracts. I applaud Fluor for supporting the US military and for providing 1000's of jobs. Fluor is a good company, I am glad they are working in Kazakhstan on the largest, most complex oil/gas separation facilities to date until you look at the leader of Kazakhstan, Nursultan Nazarbayev. Nursultan, who is the ultimate Oligarch of the post-Soviet era. While many of his stances place him in balance between the East and West, he has modified the constitution to allow himself to run as many times as he likes and is suspected of syphoning in excess of $1billion US to himself and family members. We need this investment and good companies running the show but..

My point being we live in a complex, interwoven world. It is easy for multi-national companies and US energy monopolies to use their political heft to influence public policy and energy decisions. When the Utilities say they are working solely in the interest of protecting rate-payers we should assume that is correct. We should also remember that SCANA is the only SC based utility company in the fortune 500 and they are beholden to their shareholders too.

While utility companies have 50yr generation plans to provide reliable, affordable energy, we as a state and country have an economy that runs in quarterly cycles and 15 minute news cycles. Investment capital is available and waiting to provide safe returns to investors through private solar power plant ownership. This would move the risk and cost of ownership away from utilities while they focus on Nuclear expansion and create much needed jobs and liquidity injections into a slowly recovering state economy. Capital likes sure bets, those sure bets are currently outside of SC. How do we entice those same people to invest in infrastructure in the future when we have not created the relationships in solar and RE where they are actively investing today. I am a solar guy, this stuff is not what I imagined I would be talking about at 6yrs in, but it is a way to bring solar to everyone over time and the more I research energy in SC the more I realise if we don't monetize it, solar will not become a viable energy source in time for the end of fossil fuels. I for one don't want to contemplate an America post fossil fuel without viable alternatives. Do you?

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