Monday, July 13, 2009

Governor Goes Green Energy but misses Efficiency

It is a display of the error prone nature of the Granholm administration in microcosm - do something flashy and trendy yet economically meaningless or even counterproductive - short term illusionary savings for long term expense.

This example is her making the Governor's Mansion a showpiece of green technology that doesn't make much economic sense. The "green" changes to the Governor's mansion:
Detroit News: Gov's home goes green with solar panels, wind turbines
Gov. Jennifer Granholm is taking her campaign for green technology to the governor's residence, where a wind turbine has been erected and solar panels soon will go up to increase the home's energy efficiency.

With a new sprinkler system that saves water by taking the weather and what's planted into account and a small area of the garage roof covered with sedum plants and a special membrane to keep it cool, the residence provides an example of ways consumers can save money by using Michigan products.
But when you look at the costs involved it doesn't make economic sense for your average resident and it doesn't make sense for the mansion either:

Example A - The Solar panels:
The $20,000 in solar panels that will be mounted later this month on a section of the roof over the front door are being donated by United Solar Ovonic of Auburn Hills. The panels will provide about $300 of electricity a year.
So for a $20,000 cost you save $300 per year - that means it will take over 67 years to pay off the installation cost of the panels alone. I suspect no one is buying for that much of a long-haul and indeed I doubt the panels will last that long. Indeed, one should note these panels were donated. I doubt the Michigan budget could afford such inefficient extravagance. In other words, solar isn't going to be a winner for Michigan residents.

Example B - A mighty wind:
Mariah Power of Reno, Nev., and MasTech Wind of Manistee donated the $9,000 wind turbine to the state. After federal and state tax breaks, the turbine would cost about $3,000.
. . . .
The residence will get the largest savings from a recently installed 30-foot-tall wind turbine, which is expected to save about $1,200 a year on the home's annual $10,900
Once again, donated. If the tax breaks weren't a part of the equation (after all you're paying for them with your tax money) your payoff period for the windmill is 7.5 years, assuming the predicted savings are correct. With the tax breaks the period is a lot better at 2.5 years. Of course, this estimate may be predicated on the turbine spinning extra fast in response to all the hot air coming out of the Governor's mansion, not to mention if you need various zoning exceptions and permits to install it.

Example C - Then there's the sprinkler:
The new sprinkler system is expected to save about $1,450 annually and was donated by A&H Lawn Service Inc. of Saline, Green Meadows Lawn Care & Landscaping of Clinton and HydroLogic of Minneapolis. The system for the 5-acre site -- including special irrigation for the vegetable garden -- cost $50,000, but a homeowner on a typical suburban lot would pay only about $5,000, A&H President Timothy Austin said.
Wowza - At a cost of $50,000 for a saving of 1,450 it will take 35 years to pay this off had it actually been paid for. Since the housholed ratio is likely the same (the $5000 above would mean a savings of $145 per year, for the same 35 year payoff period if you don't count maintenance and repairs over that time this doesn't make a lot of economic sense and indeed your kids probably can't even run through it.

Yes going "Green" is certainly fashionable, and it's nice that Michigan companies are getting in on the lucrative takings at the federal trough given the decision of the government to push ahead with these inefficient but pretty-sounding programs in the name of fighting global warming and raising the cost of everyhting we do or create in America. It is also very nice that companies donated very expensive installations as demonstrators, but of all three that extol such "savings", only the wind turbine seems to offer any real economic payoff and indeed decent return on the energy invested in creating, installing and operating them.

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