The Potential Cost of Indiegogo's Solar Roadways with Some Historical Context

Joel Anderson |

With two days remaining on its Indiegogo project, the Solar Roadways campaign has already shattered its fundraising goals. While Scott and Julie Brusaw were asking their supporters for $1 million to continue perfecting their prototypes and exploring the potential for manufacturing on a bigger level, they have already cleared $1.5 million.

The success of the campaign has any number of forward-thinking idealists dancing in the streets. The stunning potential for a nation powered by the high-tech roads. Carbon emissions would plummet, electricity costs would follow them, dangerous above-ground power lines would be removed, LED displays could change with conditions warn drivers of pending dangers, and snow accumulation could be melted off with heated surfaces.

However, for some others (including myself) a broader skepticism regarding the practical application of the technology seemed to be missing. Sure, the solar roadways would clearly improve everyone’s quality of life, but at what cost?

Pros and Cons of Solar Roadways

This debate is a tricky one, and both sides can defend their perspective pretty well. However, one valuable exercise might be to try and take the solar roadways project, including its projected cost, and put it into historical context.

So, as an intellectual exercise, I thought I would try to really break down what the cost of the project might be and then compare it to some other notable public works projects in terms of their cost and how it related to gross domestic product (GDP) at the time. Just one way of considering whether or not this would make a wise investment for our nation.

So What Would the Solar Roadways Cost?

So, the most-often cited stat for the cost cites a 2010 estimate from Scott Brusaw that a 12’ by 12’ panel would cost $10,000, or $69.44 per square foot. And, taking the estimate of 31,250.86 square miles of total pavement in the US that the Brusaws use on their website, you get a number just shy of $60.5 trillion for the total cost.

But that sort of hypothetical doesn’t hold much value in this case. If such a product were ever undertaken on this scale, it would create economies of scale that would dramatically reduce the costs associated with implementation. Also, even the most optimistic backers of the project probably wouldn’t expect any real progress towards the implementation of the project on this large a scale at any point in the next decade or so. That leaves plenty of time for technological changes at many different stages that could also significantly reduce costs.

And that’s also not considering the fact that smaller-scale implementation coming in the form of parking lots, sidewalks, and driveways would likely precede any massive public works projects. So the equipment would have real-world data and the results of ongoing field tests that could allow for further optimization and reduced costs. The exact opposite could also prove true, but we’ll stay optimistic for the sake of argument for now.

The $60.5 trillion number comes to 352.8 percent of our current GDP. Hate to break it to you, but that is probably not happening. Ever.

However, at half that number you’re looking at 176.4 percent of GDP, and at 10 percent it comes to 35.3 percent. Let’s consider both given that we can’t really be sure just how far costs might hypothetically be reduced into the future.

Public Works Projects as Compared to GDP

Before we even start here it should be noted that historical record-keeping is imperfect, methods for calculating GDP differ, and concepts of “cost” can vary (especially if someone is hurt/killed while building a project). And that’s assuming I used the best possible sources for all of this data (I didn’t, I used the internet).

Even if a historian/economist with a lot of time and access to better reference materials were to put together a more comprehensive study (knock on wood), trying to compare different projects like this across historical eras is itself a fairly flawed proposition.

So, the truly meaningful take-aways from these comparisons are probably somewhat minimal. However, it’s still interesting to take a very sky-level view of major public construction efforts and how they compared to the size of the economy at the time. So…

The Interstate Highway System

Total Cost: $57.34 billion

Cost in 2014 Dollars: $499.77 billion

GDP at Outset: $450.1 billion

Cost of Project as Percent of GDP: 12.7 percent

This is actually a pretty great starting point as once could assume the projects would have a lot of similarities.

The Transcontinental Railway

Total Cost: $124.5 million

Cost in 2014 Dollars: $2.364 billion

GDP at Outset: $7.689 billion

Cost of Project as Percent of GDP: 1.6 percent

Hard to say how to accurately account for all of the massive graft of the 1860s…

Panama Canal

Total Cost: $375 million

Cost in 2014 Dollars: $9.6 billion

GDP at Outset: $25.928 billion

Cost of Project as Percent of GDP: 1.4 percent

The Panama Canal remains the largest single engineering project in United States history.

The Hoover Dam

Total Cost: $49 million

Cost in 2014 Dollars: $679.33 million

GDP at Outset: $98.3 billion

Cost of Project as Percent of GDP: 0.05 percent

Leaving the transportation arena, the Hoover Dam is clearly a much smaller project. But, as it’s arguably the biggest renewable energy undertaking in our nation’s history, I’m including it.

The New Deal

Total Cost: $22.652 billion

Cost in 2014 Dollars: $413.1 billion

GDP at Outset: $57.2 billion

Cost of Project as Percent of GDP: 39.6 percent

I got to this number by combining the total expenditures of the four agencies that were primarily focused on public works: the Public Works Administration (PWA), the Works Project Administration (WPA), the Civilian Conservation Corps (CCC), and the National Youth Administration (NYA).

For those of you noting that the national GDP appears to have plummeted 41.8 percent in just five years from 1928, yeah, that’s the Great Depression for you. Ouch.

Wars

Many might not like this comparison, but war efforts are a massive undertaking by our federal government. What’s more, they could provide a little more perspective on just how much solar roadways might cost.

World War II

Total Cost: $296 billion

Cost in 2014 Dollars: $4.305 trillion

GDP at Outset: $166 billion

Cost of Project as Percent of GDP: 178.3 percent

Vietnam War

Total Cost: $111 billion

Cost in 2014 Dollars: $835.4 billion

GDP at Outset: $743.7 billion

Cost of Project as Percent of GDP: 14.9 percent

War in Iraq/Afghanistan (through 2010)

Total Cost: $1.046 trillion

Cost in 2014 Dollars: $1.4 trillion

GDP at Outset: $10.625 trillion

Cost of Project as Percent of GDP: 9.8 percent

Civil War

Total Cost: $4.183 billion

Cost in 2014 Dollars: $108.895 billion

GDP at Outset: $4.643 billion

Cost of Project as Percent of GDP: 90.1 percent

Conclusions

So, anyway you cut the cake, the solar roadways project would clearly be one of the most expensive public endeavors undertaken in United States history.

Even if the cost of project can be cut in half from current estimates, it would still represent a comparable portion of GDP to what we spent on World War II. And even if the costs are cut by 90 percent, it would represent a portion of GDP almost three times greater than what it took to build the entire Interstate Highway System in the first place.

In fact, it’s not until you strip out 99 percent of the current cost estimate that you start to get a more reasonable portion of GDP for a major public expenditure (3.8 percent).

Of course, the costs must be weighed against the benefits for any major expenditure, and the proponents of solar roadways would observe that the added benefits of paying for the nation’s electricity would need to be considered. What’s more, the argument could be made that relying entirely on history to guide decisions about future projects is short-sighted and could limit our nation’s potential to push past these limitations into an entirely new paradigm.

That said, I remain extremely skeptical. IF the costs come down in a huge way and IF other more-practical methods for expanding solar capacity have been exhausted at some point in the future, MAYBE a scenario could exist where this project would actually begin to make sense for future generations. But with so many hypotheticals at play, I’m sorry to say that this concept remains on par with Free Beer Fridays: a wonderful idea for a public works project that probably won’t ever come to fruition due to the fact that it’s totally impractical.

Methodology and Sources

For calculating 2014 dollars, I used the inflation calculator available at the Bureau of Labor Statistics website. However, since that calculator only went back to 1913, for the Transcontinental Railroad, Panama Canal, and Civil War, I also used this other inflation calculator which appears to differ slightly from the one on the BLS website.

For all historic GDP numbers, I the information available on usgoverntmentspending.com.

The following are my sources for the cost of each project:

Solar Roadways: Cost for 12’ by 12’ panel and total surface area that could be replaced.

The Interstate Highway System

The Transcontinental Railway

The Panama Canal

The Hoover Dam

The New Deal: WPA, PWA, CCC, and NYA.

Cost of American Wars

And, if you’ve read this far and actually found this interesting, I wanted to include a look at other projects globally and throughout history. So, if you think you can come up with reliable estimates of the necessary data, it would be really interesting to compare this to the Great Wall of China or the Pyramids.

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