Solar Assumptions


Some of my favorite listening is to Stanford’s Entrepreneur’s Corner.  It seems to be guest lecturers to one of Stanford B-school classes, and they’re almost always entrepreneurs who’ve made good, coming back to share their wisdom.  (The lectures tend to be entertaining, in Guy Kawasaki’s case, highly so.)

One of the recent lectures is by a fellow named Bill Gross, who’s founded a large number of companies, but is best known for eSolar and and Idealab.  How he created Idealab, and turned it into a machine for generating ideas and exploring the interesting ones, while generating profit and not causing people to fear losing their jobs, is fascinating in itself.  It bespeaks a willingness to think outside the normal managerial box, and a love of play, which is often missing in business.  I think I’d like working for Bill Gross.

Unfortunately, he then turns to his other project, eSolar.  Now, Gross doesn’t mention looking for government subsidies, although I haven’t researched how many of the solar farms he’s created benefit from them.  But he freely admits that right now, on a per-unit-of-power-generated basis, solar cannot compete with oil.  His thesis is, of course, that growing third-world economies are going to need power, too, and that there just isn’t enough oil or gas to power them through the next century.

Gross claims that solar is perfectly suited to the task, because unlike fossil fuels and wind, it’s evenly (democratically, in his word) distributed.  And then he asks the really cool question: how can we apply a law we know: Moore’s Law, the progressive advance in computing power, to solar?  He’s developed a means of closely coordinating the mirrors in a large solar-concentrator array, using microprocessors that help the mirrors tightly track the sun throughout the day, something that would have been prohibitively expensive only a few years ago.  It’s very clever, really.  Using these assumptions, he makes a compelling case for the long-term competitiveness of solar vs. fossil-fuels, without assuming huge runups in the cost of gas.

But I think his assumptions are flawed.  First, solar power is decidedly not uniformly distributed.  Colorado has 300 days or so of sunlight.  Germany and Japan, solar leaders by virtue of massive (and since revoked) government subsidy, have far less sunlight.  It’s not just climate, either.  The farther you are away from the equator, the less sunlight you have on average, because the sun’s rays come in at a shallower angle during half the year.  Even during summer, I wouldn’t want to rely on solar in Alaska.

He also puts his thumb on the scale in a more subtle way.  Other energy sources can also inventively use computing power, both in their production and their consumption.  By denying them the benefits of Moore’s Law, he’s giving his idea an advantage it won’t enjoy in the real world.

He argues that wind has its place, but it’s not a very large place.  He argues that nuclear can’t provide enough power, and here, I have to say, I find his numbers unconvincing.  (He maintains that long lead times and the expenses involved in making nuclear safe limit the number of plants you can create.  But demand will make supply profitable, and you can finish as many as you can start.)  So while he’s willing to live with a suite of energy sources, he really believes in solar.

Unfortunately, I think he’s built too many assumptions into that belief.

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