MEL - Meridian Energy

[BlackPeter]

If you are building a house solar water heating makes sense to me.

westerly

It does if you are happy to pay a premium for the environment. We installed a solar hot water system (coupled with a wet back on our log burner) 5 years ago. Works fine, and no need to supplement with electricity on sunny days. Obviously in winter the wetback does its job ... the most problematic times are overcasted but warm days in summer / autumn (nothing but electricity to heat the water ...).

However if I look at the cost of the system - and the annual payback in reduced power bills - than you look at a roughly 15 years payback period (without considering any interest ...). Investing the money in power generator shares and using the dividends to pay the electricity bill makes more financial sense, but hey ... this way we can feel like Greenies

[PSE]

It does if you are happy to pay a premium for the environment. We installed a solar hot water system (coupled with a wet back on our log burner) 5 years ago. Works fine, and no need to supplement with electricity on sunny days. Obviously in winter the wetback does its job ... the most problematic times are overcasted but warm days in summer / autumn (nothing but electricity to heat the water ...).

However if I look at the cost of the system - and the annual payback in reduced power bills - than you look at a roughly 15 years payback period (without considering any interest ...). Investing the money in power generator shares and using the dividends to pay the electricity bill makes more financial sense, but hey ... this way we can feel like Greenies

Yup I agree people need to consider cost of debt BP, buying MELCA at $1 was better now I would be a seller if I had any left. Paying a steep price for a no growth business I blinked a long time ago.
Harvey Specter the other important risk of installing panels now is if the power companies refuse further offset
subsidies (I.e letting people get 27c for a kWh which would wholesale at 6c, which they will do if there is significant uptake.
Poet computer processors doubled in speed regularly as transistor gates got thinner and thinner until the quantum mechanical tunnelling limits were reached and they started needing crazy cooling systems.
If you think solar panels will follow similar exponential growth, what is the mechanism and it's limiting factors.

[Sideshow Bob]

BP - was that a new build or existing house you installed solar to? I think Westerley was probably driving at the fact that easiest/ perhaps most economical to install when building new.

[Harvey Specter]

Harvey Specter the other important risk of installing panels now is if the power companies refuse further offset
subsidies (I.e letting people get 27c for a kWh which would wholesale at 6c, which they will do if there is significant uptake.

I thought they had all dropped their price. Agree don't expect anymore than 8c going forward.

For new builds definitely design for solar hot water, retro PV and passive solar heating. Basic design shouldn't increase the build cost at all.

[Poet]

Yup I agree people need to consider cost of debt BP, buying MELCA at $1 was better now I would be a seller if I had any left. Paying a steep price for a no growth business I blinked a long time ago.
Harvey Specter the other important risk of installing panels now is if the power companies refuse further offset
subsidies (I.e letting people get 27c for a kWh which would wholesale at 6c, which they will do if there is significant uptake.
Poet computer processors doubled in speed regularly as transistor gates got thinner and thinner until the quantum mechanical tunnelling limits were reached and they started needing crazy cooling systems.
If you think solar panels will follow similar exponential growth, what is the mechanism and it's limiting factors.

You are right Moore's law is somewhat faster than we might expect for solar - turns out there is Swanson's Law with a somewhat lower exponent than Moore - here is a nice article from the economist. This article pretty much looks at price trends for silicon wafer technologies - there is also currently a lot of effort, with some success, going into organic alternatives and other more exotic technologies such as perovskites.

http://www.economist.com/news/215664...-sunny-uplands

[Poet]

Here is a nice article on the possible disruptor technology

http://cen.acs.org/articles/92/i8/Ta...rovskites.html

"Almost overnight, researchers catapulted the conversion efficiency of perovskite solar cells from a few percent to more than 16%. “It’s tough to predict where this technology will end up,” Snaith says, but it certainly has “the right ingredients” to deliver exceptional efficiencies at the lowest possible cost.
He adds, “So long as we can improve the stability of this technology, I would say we are witnessing the emergence of a contender for ultimately low-cost solar power.”

[Baa_Baa]

In the meantime, MEL will continue to make profits and disperse the excess to investors, who will be happy to hold this excellent company for the foreseeable future, regardless of all the sideshows and maybe's.

[PSE]

In the meantime, MEL will continue to make profits and disperse the excess to investors, who will be happy to hold this excellent company for the foreseeable future, regardless of all the sideshows and maybe's.

Agreed it is an outstanding set of assets the state hydro department built but selling for a stupidly high price almost certainly a recipe for low or negative long term returns.
The yield is now down to the bank rate (or close to). I admit the strong balance sheet and the fact that the depreciation is really an accounting fiction as the assets don't need to be replaced (or do they?) means they can pay out . Nonetheless the price is predicated on everything going right, I like to see dividends paid from profit - in which case MEL would be paying even less right.
In reality nothing ever follows a smooth path into the future as analysts so confidently predict. If you are taking all the free cash flow out of a business and still getting around the bank rate you are not being compensated for the risk pf investing in a business, subject to normal vaguaries and vicissitudes.
Don't say I didn't warn y'all, there may be an even bigger sucker to buy the shares off you for a higher price but don't kid yourself that this is investing.
May as well go hit up the blackjack table, at least you get free drinks while they clean out your bank balance.

[PSE]

Recycle your capital into something unloved and underappreciated people. Always be nervous following the crowd, the safe bets are in things analysts hates - with the very important caveat that the business needs to be sound.
I am not a financial adviser giving advice, just stating what I have done and why.
I was loving this company at 90c - an outstanding company is a losing investment when you pay too much people. I will see if I can think of some more fun ways to lose money - there most be heaps.

[PSE]

Here is a nice article on the possible disruptor technology

http://cen.acs.org/articles/92/i8/Ta...rovskites.html

"Almost overnight, researchers catapulted the conversion efficiency of perovskite solar cells from a few percent to more than 16%. “It’s tough to predict where this technology will end up,” Snaith says, but it certainly has “the right ingredients” to deliver exceptional efficiencies at the lowest possible cost.
He adds, “So long as we can improve the stability of this technology, I would say we are witnessing the emergence of a contender for ultimately low-cost solar power.”

Thanks poet, this stuff is not a sideshow but long term a thing for Meridian to be aware of.
I will look into it but sounds to me like still stuff in the lab, there was great promise for nanotech to continue Moore's law but I can't see it happening. Having said that there was not really a need for computers to get faster.
Will stop bothering the Meridian thread on that one though but to say that if we are relying on a disruptive technology emerging then reason and experience would say there are at least no guarantees.