Of course this was going to happen.

An audit of solar-power generation from November 2009 to January 2010 found that some panel operators were paid for doing the "impossible" -- producing electricity from sunlight during the night, El Mundo reported today, citing a letter from Secretary of State for Energy Pedro Marin....

Preliminary evidence shows some solar stations may have run diesel-burning generators and sold the output as solar power, which earns several times more than electricity from fossil fuels, El Mundo said, citing unidentified people from the energy industry. The power grid received 4,500 megawatt-hours of power from midnight to 7 a.m. in the months audited, El Mundo said.

Electric current is electric current.  However, in a country like Germany, the price that utilities are required to pay for electric current varies based on its source.  While electricity from, say, a diesel generator gets 4-5 Euro cents per KwH, ground-based solar gets about 48 Euro cents per KwH.  This is a 10x greater price paid solely for absolutely identical power manufactured in a different way.  So of course there is going to be fraud as to the current's source.


  1. Chuckles:

    But we use only the finest recycled electrons!

    It all of Europe offering these ahem 'arbitrage opportunities' I think is the polite term.

    In the UK, the PV solar field can bring in 41.3 pence per kWh generated. Note that I am paid that merely for generating the electricity. If I ship it out to the grid I'm paid an additional 3 pence per kWh.
    If I buy a kWh normally from the local power company, it's around 11 pence...

  2. steep:

    "Preliminary evidence shows some solar stations may have run diesel-burning generators and sold the output as solar power ..."

    I don't see the problem. Diesel fuel is just stored solar energy isn't it?

  3. Earle Williams:

    Didn't they say that raising the price would guarantee innovation? ;-)

  4. eddie:

    Maybe they're running the generator to power great big lamps and pointing the lamps at the solar cells...

  5. stan:

    I thought I saw what eddie speculated about. The power was "solar" in that it was produced by the solar panels. If so, it's even more inefficient than just running the diesel generators to produce the juice. But it would allow them to claim the power was generated by solar panels!

  6. mesaeconoguy:

    Yes, but did it have a good beat?


    Paul Krugman

  7. Val:

    eddie! ROFLMAO!!!

  8. frankania:

    What do you expect when govt. steps in. Energy is energy; if bureaucrats got out of the way, each type of power would find its "true" price like every other commodity (unless it is subsidized like most agri-products).

  9. Eric:


    The disruption of a large number of European flights this past week after the volcanic eruption in Iceland made me realize that the US must do more diversify its transportation infrastructure. Maybe we should invest in some high speed rail in certain regions of the country even if it is not the most economically efficient choice. If a major natural disaster occurs or another 911 style terrorist attack that shuts down all flights for a week or more, would Americans still be able to travel to anywhere in the country (well at least the continental US) quickly? Maybe Warren can tell us what he thinks.

  10. markm:

    It's more likely that this is just a billing error, not fraud. No one who isn't leaving town tomorrow runs a fraud that can be detected merely by looking at the time on a billing record. If they intended fraud, they'd have waited for a partly cloudy day, then fired up the generators to make up part of the lost output.

    But the main point is, if you pay 10x the price for an identical commodity depending on the source, things that wouldn't matter in a rational system suddenly become very important. And also, this exposes the economic reality of solar power: in the sunniest country in Europe, it requires a 900% subsidy!

    If Spain really thinks that it's worthwhile to pay 10 times as much for renewable power, they should just tax fossil fuels enough to bring the price up to match or exceed that of renewable power. Oh wait, that would tank their whole economy - while subsidies like this only hurt the economy to the extent that renewable power actually replaces fossil fuel power.

  11. Ron H.:

    Eric Offtopic,

    A cheaper solution would be for the collectivist "we" to invest in laptops and video conferencing software for everyone in the US. Why do you think people always need to travel around at high speed?