Moneybox

Ehren Goosens in BusinessWeek writes about how Walmart became America's biggest user of solar power. As Marty Gilbert, the company's director of energy, explains the firm's enormous size gives it advantages in exploiting new energy technology:

“The more we get involved and commit to volume, the more the prices come down for the technology,” he said. “Prices for solar panels, fuel cells, wind turbines to some degree, they are all approaching grid parity.”

The company installed its first five solar projects in 2008. It’s installing panels in markets where utility rates are higher, such as California, Hawaii, Puerto Rico, Ohio and Connecticut, said Gilbert. Each system must add to the bottom line for the individual store.

There's a tendency to sentimentalize the small in American life, but scale has some real advantages. A small firm is going to have enormous difficulty even studying the question of whether some unorthodox approach to energy makes sense. Instead decision-making will be driven by a mix of inertia and personal biases. And very large firms have the ability to make changes at large enough scales to overcome the inevitable transition costs that come from changing anything.