Bloomberg and Moody’s: Corporate Buyers Snatching Up Renewable Energy Power Purchase Agreements
It appears that the opponents of renewable energy, e.g., the Koch Brothers, have won the battle but lost the war. Renewable Portfolio Standards (RPSs), the mechanism that many people thought would win the day for solar and wind, have been badly beaten down in the courts, via intense pressure from fossil fuel giants like Koch Industries, and no longer constitute a real driver for the adoption of clean energy. At the same time, however, large corporate entities are signing huge PPAs for as little as $15/MWh for wind and $35/MWh for solar.
Fortunately for us all, there is no power on Earth, regardless of how evil and corrupt, that can stop a financially attractive solution from taking root in the marketplace.
Craig, there is the possibility that legislation could be passed that would tax renewable energy in the same way some places are taxing electric cars. Those taxes could become punitive and change market dynamics.
At that point, I hope the renewable energy industry has its political act together and could mount some sort of political defense.
Craig,
I wonder why you persist in labeling everyone involved in the energy industry as fighting a war ? In your scenario noble renewable energy crusaders fight against forces of darkness and evil represented by the fossil fuel companies!
In reality, there is no “war”, no “crusade”, it’s just about providing industrialized societies with reliable energy involving a minimum of disruption to economic stability.
Industrial societies are in a continual state of evolution as technology develops and becomes increasingly sophisticated.This isn’t “revolutionary”,simply the normal process common to all industrialized societies.
Effective environmental improvements are often lost in these weird “battles” , and the general public is increasingly disinterested as they are perceived as mere political/ideological agenda’s employed for reasons which have nothing to do with environmental progress.
As Germany has discovered, renewable energy targets are not as economic or as technically feasible as first imagined.
Forget the fantasy, forget creating imagined enemies (even real ones) focus on supporting practical, economically viable, energy solutions.
Fossil fuels will continue to play a significant role in supplying energy for decades to come. Fortunately, carbon sequestration technology is improving (some industries are turning waste into valuable by-products).
Fossil fuel corporations are neither “evil” nor “corrupt” they provide the only economic means to research, develop and commercialize renewable energy technology.
Nothing is achieved by simplistic, name calling, cheer squads.
Craig I share both your concerns and also see some of the cases for Optimism.
Cheap Gas and if we dont export too much of it will continue to undermine and drive the nail into the growing coffins of the Coal sector. Just last week closure of another 2,600 megawatts were announced. The large Navajo Station at lake Powell owned by a consortium but mostly by the Salt river Project in Az. announced the closure in 2020 to 2022 time frame. This is the largest of the big plants built in the hey day of cheap coal at $ 600 per kw or so back in the late 1960’s and early 1970’s. That ERA ‘s vintage plants are all under the closure knife. Hayden in Colorado, Colstrip in Montana and Inter Mountain in utah also are phasing out half of their generators. rounding up to around another 3,000 megs turned off.
In Nm San Juan and Four Corners plants have closed or closing half their capacity and replacing with a mix of gas / solar / wind.
The utilities are making these decisions Clean Power Plan or No Clean Power Plan. Nothing the Trumpet can do. he may claim to be a billionaire but the combined CAP X of the companies closing coal plants w dwarf the trumpet like he is playing a FIFE !
Warren Buffett has announced that his utilities Pacific Corp and Rocky Mtn Power in Utah , Wy will phase out another 3,000 to 4,000 megs Hallowing Out 90 % coal generation West of the Rockies. This is planned by 2032 . Col . built its last coal plant in 2010 and is clsong most of the other ones over next decade.
So that is the good news.
As you said large Corporate organizations are ordering and demanding RE power all over the place. And most of the large finance houses are eager to under write RE.
Southern Co has gone public that they regret spending $ 7.3 Billion on the failing Kemper Clean coal CC plant in Miss. The plant only a few months old has had to shut down as one of its gasifiers broke down. Ditto another $ 25 million on the backs of the rate payers.
They publicly stated in a Press release that they should have built a big 500 or 600 meg CC GAs plant for less than $ 750 million or so.
So the hard core business case economics are on our side when you look at the PPA s being signed these days for large wind and solar. Good signs.
All this being said and factual – Breath ‘s concerns and point needs to be taken carefully as the Carbon Industry is rapidly and aggressively formulating all sorts of Blow Back tactics including taxes on wind, solar, Electric Cars in a circle the Wagon defense against increased spread of R E as we are hurting their current and future profits etc.
Several State legislatures guided by ALEC are behind all sorts of market distortion schemes to derail RE. So as Breath says we will see more of this.
They will capitalize on the politically driven rules that pay solar dg full retail rates for excess production which results in some Green Bling for the Rich ( remember I am a solar dude but Truth is Truth) and these excessive payments are becoming a wedge issue that will prove Divisive and could lead to state taxes in a crude blow back. These battles are ongoing and have not reached their peak.
If Trumpets foolish budget excesses get carried out there will be growing deficits so his carbon masters can orchestrate some taxes on the upper class who bought solar ( with subsidies) at the expense of the working class.
this level of blowback is in high gear as certain political groups in Illinois and NY State are now protesting the recently approved subsidies for failing nuclear plants. These total in the Billions over their timelines. Now they are going to court and lots of legal expense and 2 plus years of various groups meeting to compromise on a plan to save the nukes were expended , now the anti tax activists funded by right wing are clamoring for claw back of these nuclear plant subsidies.
So there are many Cross Currents running in the oceans. Alliances are not firm as the ground is shifting.
I see the utilities as joining with RE as they want to sell EV electricity and they are chartered to try and use the least cost generator cost possible and that is now solar , Wind and Gas.
Utilities want to own solar plants them selves and integrate them with gas.
per Breaths point The Texas Senate has just proposed a new Bill that limit the location of wind farms within 39 miles of a AFB! Now this is serious as 38 % of Texas’s 20,000 megawatt Wind capacity is close to 2 AFB in Abilene and Big Spring Texas. ( old bases for C 130 and lite training not first line bases or Missions) Also some down on coast near Corpus Christi Tx. – Naval Training base.
They vote on this in a few weeks. Lots of Lobbying going on. On the surface it is ludicrous as some of the first Wind farms were built along the I 20 corridor near Big Spring, Sweetwater Tex close to 20 years ago or more.
No crashes or issues have happened. Based on reality the Bill has no merit. But the push back for profits for Carbon fuels is strong. So we shall see.
The State Senator for who I serve in an Advisory role is leading a strong effort to derail this carbon energy anti wind bill. Texas Grid is saving hundreds of millions of dollars from Wind. Wholesale elec price has gone Down due to wind energy. etc. They want to build 15,000 more megawatts.
So the Carbon heads are swimming against the Tide of Economics and technological advances – a weak proposition.
So I concur with Breath that these things may happen and many other different forms.
Solar users should get a market based rate for their excess production and it should be seasonal in price as Whole sale electric markets track the seasons and their price should reflect that Variance. The industry no longer needs nor can it justify the full retail buy back rates. it is a tax on many non solar customers and many a Academic study has called it Green bling for the Rich like those in N of SF. California. Massachusetts and others are way up there and it fuels the fire against Green energy.
Green energy folks should not be trapped in arrogance and live in a Bubble bias like their failed candidate for president Bubble Bias as it is fatal!
We must keep our Saws Sharpened! Carbon is coming after us. I say Bring it ! the last hurrah …..etc..
California is over generating over 7,000 megs a day now And CASIO has to curtail it. So bring on some batteries and when oregon gets off coal then they can off take it. Lots of good things are possible.
Breath per your concern about how the Carbon sector will influence the politicians to rig tax rules or other barriers to slow down the development of EV s. this is being done to protect their carbon in the ground future profits.
In late 2016 Bloomberg Financial news said if EV sales continue to grow at a decent clip then 2 million barrels of oil will be displaced by EV in 2023. This creates Oil glut – hurts prices etc.
2 million x $ 55.00 = $ 110 million of forgone revenues PER DAY. If you factor in conversion losses in the refining process then the losses go up . My memory slips me what the conversion losses are.
Bloomberg said if gas prices remain low for the near term then it pushes out this 2 million barrel a day figure to 2028.
The potential revenue loss per year is a HUGE number its no wonder Carbon forces pushing back in any manner at their disposal including Bribery!
Solar , Wind and EVs and related are disruptive to the CARTELS that dominate the majority of the Human Race ! they are the keys to Freedom if done properly. key word done properly.