The Cost-Effectiveness of Renewable Energy: Will It Win the Day?
I wish there were a way to spin this article in Forbes as exciting “new news,” but it’s been totally obvious now for several years: the plummeting costs of solar and wind energy is in the process of making everything else increasingly difficult to justify financially. This, of course, is why:
• Far more MWs of renewable power is added to the grid-mix each year than from any other source
• Job growth in this sector far outstrips what’s happening in the economy as a whole, and
• Shell Oil predicts that by 2060, the Earth’s energy supply will come 100% from its nearest star.
The only truly interesting thing about the rapid migration to clean energy is that it’s happening in the context of the last gasp (and it’s a considerable one) of the incredible wealth and power of Big Oil, which is trying its damnedest to delay the crossover point as far into the future as possible. Yes, they know as well as you and I that every day we wait is a tick of the clock closer to the ruination of our planet, but that seems, astonishingly, to be of negligible concern to them.
In turn, this gives rise to the question: will all this happen in time to prevent global climate catastrophe? Wish I could tell you.
Holding my breath anxiously for renewable clean energy, hoping I won’t be holding my breath because fossil fuel idiots have won.
When it costs more for fossil fuel it will be obvious to almost everyone to switch. Fortunately utilities have smart people that are figuring this out and more and more people will experience either full electric vehicles or at least hybrid vehicles. Hybridizing traditional gas guzzlers will eventually be much better than they have been and will make a difference. Many large electric power users are finding solar and wind investments make a lot of dollars and sense. The rest of the world is not hampered by Trump, Koch brothers or a bunch of ill informed right wing nuts.
@Craig
I have often commented in forums such as 2GreenEnergy, as well as in academic forums also, on the subject of: New Age Global Future Energy Generation Technology Imperatives.
My comments although consistent do not represent my personal views; preferences or ideologies on the subject alone; they come from a much broader global experience over many years and are based on observations and understandings about global human aspirations, and how they are intrinsically dependent on abundant energy availability more than any other attribute or resource.
All people have aspirations for themselves, family, community and region, and you should not be surprised that there is a high degree of commonality in human aspirations. But that is where the similarity ends, and it is all due to abundant energy security and availability.
The key word in the global energy debate here is “Abundant”, and that means the world collectively needs to focus on producing at least 40 times more power than is currently being generated globally (and the need will rapidly expand beyond this multiplier with new energy intensive industries coming into focus). This will come as a surprise to most 2GreenEnergy readers who have become accustomed to being told that the world generation requirements are in retreat and can therefore be easily satisfied by current low density renewable energy generation technologies, which is a fantasy.
“Aspirational Energy” I call it. And energy availability does not simply mean a basic energy existence to survive for example by pumping a bit of water from a well or light up a room at night to read a book. “Aspirational Energy” is that capable of mobilising massive community/regional/national infrastructure development industries. A good example would be, all of those industries that have contributed to all that which you see around you supporting your privileged lifestyle.
When you laud and leverage for your own purposes, an Off Grid solar project in an underprivileged place as a great energy step forward for that community, I am only reminded of your consistent lack of vision and small mindedness. I often find myself amongst those beneficiaries of “the great energy step forward” projects and which I see in an entirely different context to you. I am absolutely not content with that outcome representing the “total solution” and defining the limits and scope of their future personal and/or community aspirations.
“Aspirational Energy Generation” is a global technological imperative that can and will be solved by the world’s best and brightest physicists, scientists, researchers and engineers by 2040 I expect, and commentators should start ramping up the rhetoric on this subject.
The global energy future landscape is all about “ABUNDANT – Safe – Clean – Low Cost” energy security, to power New Age ENERGY INTENSIVE Industries/Technologies which are urgently needed.
If you were to challenge some of your academic luminaire associates Craig to prepare a concise well-considered essay on New Age Global Future Energy Generation Technology Imperatives, from the perspective of those who do not have access to abundant energy to enable the development of a modern society for their families and communities in the future (which is over 50 percent of the world’s population); you might be very surprised by the scope of technological conclusions.
You are a very long way from understanding future technology as it will and must apply to New Age Global Future Energy Generation Technology Imperatives Craig.
At the risk of boring you yet again with this point and to summarise:
The New Age Global Future Energy Generation Technology Imperatives demands solutions that:
– Must deliver Abundant, Safe, Clean and Low Cost Energy;
– Reduces Energy Generation Greenhouse Gas Emissions to insignificant levels;
– Be scalable and easily deployed cost effectively to power New Age Energy Intensive Industries and businesses;
– be available to benefit all people.
Lawrence Coomber
Lawrence,
You wrote, “The key word in the global energy debate here is “Abundant”, and that means the world collectively needs to focus on producing at least 40 times more power than is currently being generated globally (and the need will rapidly expand beyond this multiplier with new energy intensive industries coming into focus).”
From what I’ve read, it looks as though global demand for power will increase by about FOUR times as poor nations strive to lift their people out of poverty, yet you have written 40 times. Is that a typo?
Dear Lawrence you articulate the emerging need for additional environmentally clean sources of Power… to fuel the energy intensifying new economy etc .
There is much literature that supports that trend and need. However the Options continue to narrow and some long time pretenders are now them selves dropping out of the running. Collateral damage on the road to cleaner yet cheaper energy and they just could not make the grade after 60 years or so of Governmental subsidy at the highest levels and other market needed supports.
The Bells are Tolling once again for the GENIE – so this ups the ante for other new companies and new developers fresh faces perhaps can turn these trends around ???
sure you are aware of this but the Light of Day needs to shine thru Craigs site for others to see what is really going on
Reports: Nuclear firm Westinghouse Electric to file for bankruptcy next week
AUTHOR
Robert Walton@TeamWetDog
PUBLISHED
March 24, 2017
• Toshiba informed its main lenders today it is planning for Westinghouse Electric Co., the nuclear engineering firm overseeing construction of new generating facilities in Georgia and South Carolina, to file for bankruptcy on March 31, according to sources briefed on the matter, Reuters reports.
• Reuters also reports exclusively on preparations utilities are making for the potential bankruptcy of Westinghouse.
• Toshiba acquired a majority stake in Westinghouse in 2006, but last month was forced to write down $6 billion at the company due to difficulties with its projects. The company is managing construction of new nuclear generation at the Vogtle plant in Georgia and V.C. Summer in South Carolina.
Utilities and other parties are gearing up to deal with the ensuing fallout if Westinghouse files for bankruptcy. According to Reuters, utility clients of Westinghouse have hired advisers in preparation for what could be a protracted financial untangling. Toshiba has reportedly hired a consultancy and law firm to help prepare for anticipated bankruptcy claims.
Both the Vogtle and VC Summer plants are years behind schedule and costs are mounting. While development of those plants will likely continue, there are rumblings that if Westinghouse goes under, it will likely spell the end of new nuclear development for the time being.
MIT Technology Review believes a Westinghouse bankruptcy means an end to new nuclear construction in the United States. The news outlet also reports analysts doubt Toshiba will find a buyer for its stake in Westinghouse, nor any construction partners willing to forge ahead with the nuclear plants it planned to build.
In a recent financial presentation, Toshiba said that it intends to “reduce risk at eight plants currently in progress by thoroughly implementing comprehensive cost reduction measures.” Earlier this year, the company indicated regrets over purchasing Westinghouse.
So it goes the other players need to get into over Drive and Deliver something rather than keep having one long and endless Circular Discussions . Much real work to get done and within a budget that the economy can Afford and Absorb.
The future economy can’t afford to have to spend $ 192 billion In Japan to cover over the past mistakes ( that figure is still growing folks) and short cuts that were made in the Zeal of the Moment!
Legacy Issues never Die nor do their rising costs.
The path forward is indeed quite challenging – lets see who Steps Up and fills the Breech as they say. I compliment you for sounding the alarm and share the above to reinforce the challenge we collectively face.
Have good days
Craig, I wonder if “Shell oil’s prediction of 100% energy from the Sun is an accurate restatement of their position or if true then is it just pandering to environmental interests.
“Solar energy” includes all forms of energy we use on Earth, including fossil fuels excepting geothermal, nuclear, and tidal energy.
Fossil fuels while having a solar origin are not “alternative,” “renewable,” “sustainable,” or “green.”
I don’t see the World or the US giving up the pursuit of Nuclear Energy or geothermal or making use of gravitational forces like tidal energy (and to some extent hydro) by 2060. So what are they actually saying?
But on balance everywhere we look on the web we see cautionary notes for fossil fuels. Coal is everywhere on the decline as it is seen as the dirtiest form of fossil fuel. We cannot pump all the oil reserves and this must devalue those companies. The low price of natural gas is not sustainable relative to the world market price and there will be an adjustment.
At the same time we see agreements for Solar thermal plus storage, PV, and wind that are below the cost of not only natural gas load following plants but even base load power. Even nuclear power is fighting against the pressure of these cheaper alternatives.
Even more widespread adoption is limited by grid level energy storage. While many speak of a new technology, an even playing field and some industry standards have the potential to rapidly advance this industry. For that we come somewhat back to the present dysfunctional political environment and the political influence of fossil fuel interests.
Money one form of power which can be exercised in government. But as the money goes out from fossil fuels so also will the political power.
Frank, Breath and Silent running as usual your comments are well considered and comprehensive ones.
Largely though, they are retrospective compilations of disparate and inflated views of others, and this sort of stuff is now showing to be the Achilles heel of the overly noisy and near hysterical renewable energy commentary trotted out over several years, bombarding ordinary people, ordinary communities, and ordinary policy captains, into making decisions on information that at best was incomplete and deceptive, and in general originating from vested interest groups alone and therefore lacking genuine objectivity or focus on the core energy security policy issues required for future communities to thrive and prosper.
This is an aggressive view by me it appears but please be mindful that I make my living as a Renewable Energy Solutions designer and installer and have for over 10 years, and have plied that profession in many countries quite successfully (including the USA). The RE industry is a very important one globally and handled correctly has huge contributions to make in specific scenarios.
Here is a case in point that illustrates the above points:
Craig said in a recent post headed:
ANOTHER STATE INCREASING RATES ON RESIDENTIAL SOLAR
“2GreenEnergy frequent commenter and all-around cool guy Brian McGowan sent me this article on the push-back that residential solar users in Northern Texas are receiving from their power utility.
Craig’s response:
Well, at a certain level, all this is business as usual for a power utility: fighting to protect its profits, which means convincing the PUC that this fee is both fair and required. (And based on the article, I’m happy to see that this isn’t going to be a piece of cake.) Read more of this post”
The article in question goes on to inform us:
The state’s largest regulated utility wants to add a monthly minimum charge for homeowners who have solar panels, wind turbines and storage batteries. That covers about 10,000 customers in the Oncor service area, which includes North Texas.
End of story.
Wow surprise surprise!
Who on earth saw that assault on the ordinary solar owner citizens of Nth Texas coming?
Well it appears no-one (until last week)!
Or at least not one of the overly noisy and near hysterical renewable energy vested interest or ideologically brainwashed commentators that have absolutely no interest whatsoever in encouraging a balanced proportion of critical analysis or evaluation of what’s being shot from the hip about RE at the ordinary people, such as those ordinary folks of Nth Texas who relied in good faith on the hype and hysteria put in front of them daily by all and sundry including 2GreenEnergy.com, inducing them to confidently make important financial decisions affecting their future livelihoods.
Where was the balanced objective analysis (this is a global subject after all) illuminating these easy to evaluate and forecast in advance outcomes; adding vision and balance to the industry; and helping customers make visionary decisions? Well they were out there, but they were drowned out in the hysteria and hype, and criticized as recalcitrants?
I hope some of the ordinary solar system owners of Texas who relied heavily on the “expert media” of the day that persuaded them to make an investment on (what now is apparent) incomplete information, contact Craig and ask him why 2GreenEnergy.com was not sufficiently up to speed on subjects like this, and being more even-handed and objective in their expert commentary on this and kindred renewable energy subjects?
Naturally Craig’s defence would be “I didn’t see that coming 6 years ago”, and I am sure that he didn’t. But that’s no excuse. If we search for objectivity in all things, it’s there to be found.
I recall discussing this very topic and much more with classrooms of RE manufacturing CEO’s during 2007 and everybody had a clear understanding of this inevitability and many more RE industry inevitabilities well in advance.
I personally know of many solar systems that have been installed and never turned on because of economic considerations along with many others being commissioned then turned off. This “ultimate stranded asset scenario” might come as a surprise to many readers.
Let’s not get into a wind energy technology debate at this time.
Lawrence Coomber
Lawrence you seem to have a certain passion in the comments recently posted. While you suggest that you have taken an aggressive view, I wouldn’t know as what is aggressive might vary according to your usual demeanor. Rather I think attacking other postings as “retrospective compilations of disparate and inflated views” seems an effective attention getting rhetorical technique.
I am not entirely sure what you intended to imply by “retrospective compilations of disparate and inflated views of others.” It sort of sounds like a puffed up history lesson of distinct research elements. Though I am not sure how you puff up a perspective. Clearly you do.
You are an expert and I would be loath to attack someone’s livelihood especially in an attempt to aggrandize myself on a somewhat benign forum. You are a “Renewable Energy Solutions designer and installer.” I must admit I had no idea that a RE systems peddler would have “…understandings about global human aspirations,” as I previously thought that was reserved for the omnipotent and omnipresent. Perhaps that is also part of your awesome job description.
Regardless, of your RE credentials you seem to hold the position that unless a solution is clearly capable of supplying 40 times the present energy available in the world it is not worth consideration. You are intolerant of incremental steps that may supply power to some village. Once we understand you are viewing the world from a position of omnipotence this is completely understandable.
Lawrence thanks for clarifying the matter. I will try to remember my mortal status and keep my comments within the bounds of human decency.
What has been lacking is a careful examination of cost structure and taking it into consideration. The cost of fuel is not the only cost of electricity. The interest and maintenance costs of the generating and distributing equipment are also very significant and may even exceed the cost of the fuel. Some of those costs remain to make it possible to deliver electricity to a customer even if the customer rarely uses utility power and instead generates his own power. Those costs also remain even even for a customer who generates power and returns the excess to the utility.
I do not claim to be an expert on cost structure, but presumably utilities are. However, if cost structures are not carefully analyzed and if customer’s solar systems reduce utility revenue by more than utility costs, naturally utilities will object. That should have been anticipated but instead, it is commonly ignored.
On a related matter, when comparing the cost of renewable power with the cost of traditionally generated power, some of the costs of renewable power are ignored. For example, to put a large new solar system on line, it is usually necessary to make expensive changes to the grid. That cost is generally ignored. The cost of dealing with the intermittent nature of renewables is also generally ignored.
Fellow RE Global Warrior Extraordinaire Lawrence Coomber,
Enjoyed your From the Frontlines Dispatch about some economic and technological pushback related to Solar DG in Texas as you point out some of the Inconvenient Truths that have been Brewing for some time….it was a slow burn to a degree.. It was inevitable that the entrenched Utilities that have a a tremendous investment and ongoing cost to provide reliable electricity were going to try to check or control the rapid spread of solar DG as its disruptive to their business model. The business model can only afford a certain degree of disruption and revenue erosion.
Lawrence I have been aware of what you were speaking to and alluding to for several years myself. There are many others in the RE consulting world and academics who collectively knew and know that they’re are going to be conflicts and mis alignment with benefits between the Grid and the solar user if penetration levels reach beyond certain trigger points or lets say Tipping Points. Paying retail prices for excess energy in the spring when the wholesale price is low is not good economics either. It leads to more Green Washing etc.
Lawrence I laugh too when a radio announcer rattles off well today Germany generated enough solar and wind to run Germany for a certain time. They only speak to the Tip of the Iceberg as the Wise Ones say!
They espouse the BUZZ as if its Empirical information and a whole new simple paradigm for self owned energy is within the commoner ‘s reach and all will be good…..etc…etc.. while I like the progress we know that there are trade offs being made like burning more coal in short run in Germany and dumping excess power into other European Grids etc.
In California now CASIO the Grid operator is ramping down or turning off up to 7,000 megawatts of excess solar generation during the middle of the day…no where to send it? ! Alarming but its reality… they are scrambling to develop a mitigation plan etc. as Casio projects they will have 13,000 megs of excess solar by 2020 or 2022.
They will correct for all this but it costs money who pays is the burning question and that is part of what the utilities are trying to get solar users to realize that one can’t always have all the cake and eat it too. One has to be reasonable and right now both sides are un reasonable. some leadership needed.
Until W Buffett’s Oregon based utilities shut down more base load coal they can t absorb much of the excess solar even though they want it. Talk about Hobson choice! .
Not all this is bad but there are trade offs like the coal burning when they could be running existing older nuclear units. Did not say build any just run what you got and turn off the coal.
People hear the radio announcer and they think WOW if Germany can do that we can to, it must be so simple. Real World power engineering and distribution is a complex Rubik’s cube lots of variables. It requires the proper mix of technologies and the orderly phase out of the dirty technologies or no longer economic ones too!
I quote some good numbers from time to time as it is exciting to see the RE ramp Up since 1978 the progress made that came real hard too, but know there is a need for a System of Systems MIX that can balance out the strong and weaker points of the various technologies. that is the way it needs to evolve into practice.
Maybe 10 years from now CPS w 6 to 8 hours of storage will price right and be in the “money” so we will have some RE base load but not there yet. While anything is possible so maybe it will be shorter!
Lawrence, another over looked and seldom discussed topic area from the solar jockey promoters of home dg who are obsessed with selling any number of panels they can is the possible technical issues with high saturations of solar dg on a Grid system .
Most Grid Impact studies say 15 to 20 % of peak load is when there is too much electrons pushing back into the Grid. Creates Voltage issues, need for Reactive Power corrections, transformer sizing ( re designed) , power line capacitors and regulators etc., some or all may require upgrades depending on a feeder line situation, etc.
A utilities generation mix is also crucial with the amount of RE variable generation that can be integrated properly without damaging the integrity of the grid or creating excessive generator cycling and ramping that is costly. We on 2 Green energy are supposed to be environmentally sensitive and espouse to Best practices to make the project the real thing and not promote Green wash.
Lawrence when many solar hobbyists or solar jockeys are confronted with some of these technical realities they stare at you with that Deer in the Headlights look and just chalk it up to well Monopolies don’t like or value my solar! End of story. Its a conspiracy.
Now true disclosure I am invoked in the other rate case in Texas that is the article Craig put out and provide some input and support to a collection of well meaning but biased and emotionally charged solar activists who don’t want to make any compromises or adaption of their technology to the real world. I am more than aware of the other side of the coin. The utilities while we need them they also play loose with our money and avoid being responsive to market changes and new technology. So they are not Saints and are getting heavy handed etc. Whether we will stop the demand charges, the excessive back up rates etc is to be determined but its a good mental exercise but very frustrating as there are pathways that can allow for WIN – WIN – WIN Triple bottom line results.
I am sure you have encountered this type of indifference to reality.
How ever To address these real issues large saturation’s of DG the utilities will have to spend on upgrades and automated enhancements ( so called smart grid) . As California marches on to 50 to 75 % all RE goals the utilities are releasing their cost estimates for system distribution and automated distribution management systems to the California PUC and Energy commission. So Cal Edison was the first and they set a budget number of $ 9 Billion ! in upgrades probably some more fast ramp gas units too thrown in. That is what they say they need to make the Grid operate and be stable and accept much larger volumes of variable electricity and do all the trans-active power exchanges that the techies write home to their legions of techno friends about …
of course it is a Gold Plated figure and subject to refinement.
The point is this. In a time of declining energy sales, slow or no growth and rising costs the electric utilities are faced with further erosion of their cash flow and have to invest more money to handle it. Think about it they have to pay for the damage being done so they want to Collect …from who and how much ?
So someone has to pay for all this.
I sell some solar and believe in it but fair is fair. I have always said lets design the solar system so it can integrate with the grid more beneficially and the solar equipped facility can be a load management tool for the utility. Include Advanced Smart Inverters.
This means that residential solar would yes save energy, reduce kwhr sales but its effective load carrying capacity would be around 45 % to 50 % with south only facing panels. Not reducing peak demands from Grid very much, limited.
A hybrid solar system that has 2.5 kw South in Texas and then installs another 2. 5 kw West will reduce the peak loading of the residence more completely during the Grid peak time periods. This is a valuable thing and can reduce generation and transmission costs in a significant way. Like major capital cost avoidance for the utility and its other customers.
Lawrence you know there is usually design trade offs in energy engineering and this load mgmt example I propose has one. It reduces annual Kwhr production around 650 Kwhr over the entire year. So there is a loss of a lousy 650 Kwhr of energy ( much of it in winter when the utility already has more excess so the excess is reduced ) At retail that is $ 65 dollars over a year. Chump change for the solar user to give up.
The system of system upside is that the solar system will now have a effective load carrying capacity Value of 66% to 70 % and its worth to the electric summer peaking utility is much higher.
The West facing panels are generating full load output at 7 pm in summer as the Daytime peak is ending in the SW part of US.
South ( only)facing systems peak out around 3 pm or so so they are only partially reducing the peak on grid.
This is the RUB and utilities know this from studies so they can’t give the solar users all the capacity credits etc. that solar enthusiasts claim are there.
The PUC’s need to get these folks together and have a come to Edison moment. Hybrid S /W solar systems have much to offer the grid and still save people money and they can get a decent return on the investment. The utility does not have to charge them a onerous back up rate as they are giving utility needed capacity when its needed. All about time shifting to meet demand.
There will be less excess Kwhr back fed into the Grid but the Grid can now afford to pay wholesale rates and in peaking times with TOU rates then maybe pay more but with out asking Non solar customers to subsidize the Green Bling Jet set some more which is what has happned all over the nation and it creates Blow back too!
Full retail buyback rates made sense to get solar going but now its time to Man Up and Stand Tall on its real merits. Throw in advanced inverters and then the solar system can provide some Ancillary services to the Grid and become more valuable. Lots of creative things could go down.
.he other issue will be that utilities will build more utility scale and community scale solar as the cost is getting down to $ 1.00 to $ 1.35 per watt. All in – Turnkey. And single tracking solar gets a 70 % levelized load capacity value.
People get confused by annual capacity factor which is important but day time effective load capacity is the planning number that counts.
So the utility can plan on getting 70 % off of it during peak for planning purposes. Same with the residential hybrid system I describe S / W system.
But as you said Lawrence there are too many Apostates in the Green Energy Game just like any other sector it attracts all types.
Some of these things could be settled and the cause would advance further but there is a Gulf between the many players and that’s how markets don’t work so well it seems.
I trust that I spoke to some of what you were trying to say as I did not take it that you were dissing DG or real Green activity you were making Real World Observations from the firing lines…based on your experiences.
Lots of obstacles but also lots of Opportunity for good I still believe. ]
take care
@Silent Running
I am a little concerned that you must be on steroids this year SR!
Your posting was the best I have read in any forum in a long time.
Stick with the steroids mate – they are working.
Lawrence Coomber
Lawrence your kind comments are welcomed as the Trail does get heavy out there as you know all too well.
Frank added in some of the other hidden costs of making changes to Grid in his usual technically sensitive style.
We are all saying similar that there is more to things than what meets the Eyes!
Re is going to grow but there are going to be cost and other investments needed to make it Integrate in a Harmonious manner.
Solar Dg and progressive utilities can co exist but the solar crowd also has to do some growing up and realize that they can’t eat the whole cake and icing and still get a Cherry on top all the time!
Rather they need to share some of the cake, icing and order two or produce 2 Cherries so they and their supplying utility can each have a Cherri o Day!
Shared costs and Shared Benefits is the real M O !
later Mates windy and dust blowing in Panhandle today darn! But wind turbines are spinning good.