Solar worries

Punjab joins the list of states setting up solar power projects.

“The Punjab government, in collaboration with US-based SunPower Corporation and Enterprise Business Solutions (EBS), has decided to set up solar power plants in the state. The plants are expected to generate 1,000 Mw over the next two years”

Its a decent start.  Punjab has installed power capacity of 6000 MW – and adding solar capacity of 500 Mw is a pretty good way to get green.

However, I am beginning to get a little concerned over the enthusiasm to go solar in India.  It’s not clear, for instance, what the capex on this project will be and how that compares with other sources of electricity – and importantly with other solar plants worldwide.  Is there a subsidy involved?  Is this a competitive process?  What are the metrics we are using to measure the effectiveness of this investment?

“Bad” corruption

It seems that people around the world have come to accept corruption as a given.  In fact there are multiple definitions of what is “good” vs. “bad” corruption.

This from the freakonomics blog in the NYT:

Ray Fisman, writing in Foreign Policy, explains that some types of corruption are better than others: “In an orderly, predictable — yet corrupt — system, businesses can at least calculate expected returns and plan accordingly.  Paying bribes to an unstable or unpredictable government, on the other hand, requires a leap of faith and a quick exit strategy.” Viewed in this light, the recent Rio Tinto trial in China may actually be bad for business as “it might be signaling to foreigners that they are entering a new era of uncertainty over the rules that govern their interactions with Chinese bureaucrats.”

It turns out that the Economics of Corruption is actually a study in itself.