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October 05, 2012

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coal is less than 1/3 the cost of solar if you consider that solar can't be stored so needs backup baseload capacity and several other factors.

yeah! 1/3 the price if we do not count negative externalities.

Chinese manufacturing productivity is its own enemy in market. Over efficiency from large nation like China leads lower price/value for its product. It become low value added product.

HS, you are right about cartel like market control for value creation/transfer. Crude oil, diamond industry, medical practice,ect all master their wealth through cartel like control. Chinese govement needs to learn that.

And having Ozone ratings of 400 + ppb in their cities must be paradise.

Your post describes what many here have talked about in regards to culture of the west vs east. Here have noble goals and aspirations. We seek a better world. While in the east smart but cynical people only want to get ahead. There are strengths and weaknesses to each approach so please spare me western utopian critiques but tell me would anyone really want to live in Asia? The real Asia I mean not the one set up for wealthy expats.

[HS: The best place to live is somewhere in the US that has low cost of living and not too many NAMs.]

Sounds like it's a good time to buy solar panels? If you're into that sort of thing...

Solar panels are not bad, they could be rather good. The problem is that, as a nation, we spend our dollars on social services for immigrants and their progeny at a pace that few people can begin to imagine. If the vast majority of those people were not in the country, it would be easy to provide the nominal subsidies to make solar panels worthwhile. The main benefit is then better air quality and clearer skies.

Unfortunately, liberals don't see the problem. My father tried to tell me that all the immigrants and their kids were not really very expensive to have in the country. I wonder how he calculated for loss of hours worked and loss of quality of life, when sitting in endless traffic?

Ignorance is bliss. Best way to be happy is to know as little as possible. Then you only know you are the best.

Are you really so foolish that you think China based an $18 billion investment on the political rhetoric of a foreign leader? Seriously, get your shit together and dispense with the sloppy thinking based on nothing more than your petty political spite.

Why would China do this when Obama's main thrust in this area has been to establish a *domestic* solar industry?

Also, why don't you read the damn articles you link to, instead of just skimming the headline and drawing bullshit conclusions. To wit:

"Chinese solar company executives blame their difficulties partly on the United States’s decisions last spring to impose antidumping and anti-subsidy tariffs on solar panel imports, and on the European Union’s recent decision to start its own antidumping investigation of imports from China."

If they're "too smart," to utilize solar as you say, why are they not smart enough to prevent over-manufacturing it when their markets are so inclined to protectionism?

China should be subsidizing its domestic consumption so as to reduce their combustion of coal which often makes their local environments unlivable (as well as exporting atmospheric soot to the rest of the globe), but that sort of full accounting doesn't often enter into Chinese business or governmental decisions.

"Solar panels are not bad, they could be rather good. The problem is that, as a nation, we spend our dollars on social services for immigrants and their progeny at a pace that few people can begin to imagine. If the vast majority of those people were not in the country, it would be easy to provide the nominal subsidies to make solar panels worthwhile."

The obvious solution to this dilemma is to use the immigrants to provide cheap energy, perhaps by running in a giant hamster wheel for a certain period every day.

Coal is a bad energy source Sigma, there is no getting around it.

There is a reason the air in China sucks. That's a real externality, don't even need to get into the global warming debate.

Thankfully China is doubling down of nuclear energy plants so hopefully they'll transition out of it soon enough. But at the moment their air sucks.

"Chinese manufacturing productivity is its own enemy in market. Over efficiency from large nation like China leads lower price/value for its product. It become low value added product.

HS, you are right about cartel like market control for value creation/transfer. Crude oil, diamond industry, medical practice,ect all master their wealth through cartel like control. Chinese govement needs to learn that."

Chinese industrial policy (at least in some industries) is to force various manufacturers to compete against each other until only the most efficient companies are left and the bad ones are out of business. This is somewhat like trying to foster the perfect competition market models you see in economics textbooks, where profits for the firms are zero at the market clearing price.

This isn't a bad policy for the Chinese gov't since they're not running the solar factories themselves but trying to develop the most efficient one via competition.

Value added is simply sale price minus cost price, and it's not a good thing if it's achieved via politics, monopoly, market power, manipulation, etc. i.e. rent-seeking as it often tends to be.

To keep western proles happy, western media like to report this.
http://nomoreccp.files.wordpress.com/2008/10/2004-11-18-china_poverty1.jpg

But most China rural area is like this.

http://www.bcbay.com/news/newsViewer.php?nid=71446&id=110831

Ignorance and cherrypicking are the best way for happiness. As long as you think you are better, then it is all good.

This is the same song playing in the US. Public/private partnerships begin where gov spends tax dollars to pay someone to do something that the market is rightly avoiding.

Nobody needed this stuff. Much of China is hideously poor. Instead of making something useful that would improve lives, they make gov-induced crap.

"The result is a looming financial disaster, not only for manufacturers but for state-owned banks that financed factories with approximately $18 billion in low-rate loans and for municipal and provincial governments that provided loan guarantees and sold manufacturers valuable land at deeply discounted prices."

"Mr. Li said in an interview that he wanted banks to cut off loans to all but the strongest solar panel companies and let the rest go bankrupt. But banks — which were encouraged by Beijing to make the loans — are not eager to acknowledge that the loans are bad and take large write-offs, preferring to lend more money to allow the repayment of previous loans. Many local and provincial governments also are determined to keep their hometown favorites afloat to avoid job losses and to avoid making payments on loan guarantees, he said."

Do humans ever learn anything? This is the same as US banks lying about zombie mortgages! And these are the policies that only libertarians bemoan.

One thing you don't seem to consider much in your writing are total inputs/outputs, and hidden costs that are real but either not quantified or are put on someone else's books. Coal is cheap if you aren't quantifying hellish pollution, mountaintop removal, stream degradation, ash disposal, etc. West Virginia is hell. Perhaps you like the idea of a sacrifice zone, which is what WV is. Sure, you have to mine silicon for solar and metal for the framing, but its cost has at least been more realistically quantified.

Or how about the myth of cheap oil? Blogger Anti Gnostic has a good answer to that: "How much oil is currently being held off the market by supposedly recalcitrant oil-producing nations? Would they behave any differently under anyone's theoretical free market conditions? (I assume Exxon doesn't sell every ounce of oil it has laying around either).

Is there some "true market price" for oil which it exceeds right now? Post your calculations.

Has the cost of maintaining over-large, tricked out militaries, foreign aid, environmental restrictions in the US, etc., been netted out of this ideal price?

Put up or shut up, "cheap oil" advocates. "

As above, China over-produced for the US and European market, often dumping below cost just to keep factories running, and creating angry tensions with Americans and Europeans angry that their green dreams of Unicorns and Rainbows were killed by "Mr. Chen" from China dumping solar panels that killed their own manufacturers. So much for Green Jobs, they all went to China.

HOWEVER, inside China itself these panels are likely to be repurposed to Western China. China's power grids don't run across provincial boundaries, mostly, and those that do run North-South not East-West. Western China is starved for power, the Government seeks to scuttle domestic violence there and particularly ethnic separatist Muslim violence, by improving living standards, running water and power where there was none. To solidify control over Tibet, the government built a gigantic railway system all the way into Lhasa.

There is not enough spare capacity let alone any prospect of running power lines from the East to the West, but some power half a day in say, XianXing province, beats none at all.

There is no "glut" of solar panels. Solar panels are still too expensive, and need to get even cheaper.

The so-called glut is a public relation effort from uncompetitive "green energy" manufacturers demanding protectionism.

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