A Typical Clean Energy Boondoggle

Master Resource looks at the California Valley Solar Ranch

In a realistic appraisal of the CVSR we should note the following:

· An investment of $1.6 billion 250 MW breaks down to an extravagant $6,400,000 per megawatt.

· The Solar Ranch covers 1,500 acres.

· The CVSR is projected to produce 482,000 MWh per year, implying an operating capacity factor of around 22%.

· Given a reasonable appraisal of the value of 482,000 MWh per year, it is not possible that the solar panels will be able to provide a return sufficient to pay back the $1.6 billion investment within their functional life (not even close), even when ignoring annual operating and maintenance costs. Hundreds of millions of dollars will be lost (see Updated CSVR Cash Flow).


A much more viable alternative to a solar generation facility, although not the only one, is a plant using natural gas. A natural gas combined cycle gas turbine (CCGT) facility capable of 250 MW would have required less than one-fourth the capital investment, would be capable of making four times the electricity per year at 88% capacity factor, and would fit on a single acre.

Also, a CCGT facility could have been located closer to the point(s) of actual use of the electricity, and could provide dispatchable energy which could be increased or decreased as demand fluctuates; something the solar facility is incapable of providing.

So why is this project even happening?  Because most of the project was funded by a taxpayer-gauranteed loan.  And then many of the players got direct subsidies and tax breaks.  And finally the electricity from the project gets bought at an above-market subsidized rate.



  1. Sam L.:

    Cronies, and graft, go together.

  2. kppnn10017:

    The idea that a 250MW CCGT can fit on a single acre seems either very generous or very selective. I think 10 acres is a more realistic estimate. The point still holds that it will take significantly less land than a solar farm, but I wish Master Resource was able to provide a more realistic comparison.

    For example, here's a plan for a slightly larger 255MW CCGT that was wedged onto 4.4 acres while sharing some existing facilities, such as the switchyard, with an existing plant next door. [http://www.energy.ca.gov/sitingcases/lodi/documents/applicant/afc/Volume_I/LEC_2.0_Project_Description.pdf]

  3. nehemiah:

    It is expensive, so what. This is GREEN energy, the Holy Grail. What is our money to these people?

  4. Philip Ngai:

    Los Esteros Critical Energy Center has a capacity of 309 MW on 18 acres. It is powered with four General Electric LM6000 gas fired turbines.

  5. mesaeconoguy:

    Money is green, too.

  6. mesaeconoguy:

    It is guaranteed to fail, because Elon Musk isn’t involved.

  7. Gil:

    And solar panel hurts wildlife as per turbines because their flat shiny surfaces mean birds and bats mistake them for water sources and fly into them and die

  8. perlhaqr:

    Yeah. Unless they have an actual set of plans for a 1ac 250MW CCGT, they'd be way better off citing, as you say, "10ac", which is still a fuck of a lot better than "1500ac".

  9. Jerry Graf:

    I am the author of the article, and I agree that I was overly optimistic regarding the 1 acre assertion (relying too much on memory), and that 10 acres is more realistic. Since this was pointed out I researched this in a bit more detail and provided a Clarification and Correction on my website where the post originated.


    Thank you for reading

  10. Doug:

    I agree that it doesn't pencil out. SunPower and NRG (the builder and owner, respectively) received grants from the DOE (taxpayer $) which don't have to be re-paid. I worked there this summer, contracted to SunPower, in a project planning capacity. The incentives for building these plants are going to be timed out in a couple of years, thank goodness.