Now is the time to buy solar

     Two thousand seven and 2008 were unprecedented boom years for solar in Hawaii.   It’s always great for solar when oil is high and on the other hand when oil falls in price the solar business gets hammered.  It happened in the late seventies after the Arab oil embargo.  At that point in time the USA only imported 35% of oil from foreign sources but without that 35% imported oil there were severe shortages and lines at the gas pump.  I remember the price of gas going above $1 per gallon.  So many new businesses were created in the solar energy field and many became overnight experts on solar.  Jimmy Carter gave excellent tax credits to businesses to simply buy equipment.  My dad had a solar hot water system installed to his new house in Omaha in 77.  In my casual survey of local solar businesses in Hawaii, sales are way down from the boom years of 2007-2008.  This has caught many solar companies in a pinch when they were expanding everything from ads to base yards.   The price of electricity in Hawaii is tied to oil.  Electric rates got so high in 2008 many were struggling to pay the bill.  Oil got as high as $140 per barrel and has precipitously fallen to $40 per barrel; a one hundred dollar per barrel drop in a year.

 Gas got so high it shut down many airlines.  I got fed up with the high price and quit my long commute to low paying work to save gas.  Electric rates on Maui got as high as $.42 per KWH which is 500% the national average.  Today on Maui electric rates have fallen to just above $.20 per KWH.  This is a bad combination for solar and all solar installer dealers have taken a hit.  In 2008 you could not even buy a PV panel from the local distributor because they were sold out with none in stock and a 2 month wait.  Today is a great time to buy solar because modules and panels are in stock and I have seen prices falling due to sluggish sales.  By all means buy solar now because the price of oil will return to higher than ever levels in the next few years.  In my opinion oil must become pricier and scarce in the coming years due to peak oil.  It’s simple the demand for oil has outstripped the ability of all the world’s oil wells to produce it.  The stimulus package signed into law by Obama gives businesses a 30% grant for installed solar with no cap.  You can either take the 30% tax credit or the grant.  There is also a production tax credit for every KWH produced by an installed solar energy system.  That coupled with the Hawaii 35% tax credit makes solar sensible and affordable.

     M. King Hubbert predicted world peak oil in the 50’s and correctly called the decline of USA oil production in 1970.  Today the USA imports over 60% of its oil from foreign sources and produces oil at the same level as the mid 1950’s.

 We are more vulnerable than ever to disruptions in oil supply.  The low price for our oil fix is only temporary.  We are like junkies celebrating because our heroin just got cheap.  This is the lull before the storm.  There is a disturbing graph in last month’s National Geographic magazine showing the demand for oil shooting above the world production levels starting now.  In my opinion the great recession of 2009 is tied directly to the price of oil.  Oil dictates if and how our world and Hawaiian island’s run.  So now is the time to buy solar. For more info on grants and incentives go to: www.dsireusa.org/library/includes/incentive2.cfm

Franklin Russell Smart Roof Systems