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In 2017, The Myth of Powering the World with 100% Renewables Has Started to Crack

When thinking about 2017, it is easy to see the bankruptcy of Westinghouse and the subsequent cancellation of its Summer project in South Carolina as this year’s big issue.  But as the year has drawn to a close, the continuation of its AP1000 project at Plant Vogtle in Georgia has been approved by the regulator and there is every expectation that Westinghouse will emerge from bankruptcy in 2018.

So while important, to us there is a much more important defining issue for 2017.  It is the very real start of a movement that recognizes that powering the world with 100% renewables is a myth – and that chasing a myth will not get us to our global goal of meeting the world’s increasing energy needs while reducing carbon emissions and successfully combating climate change.

There were a number of defining moments in 2017 that highlight this change in attitude.

First there was the paper published in the Proceedings of the National Academy of Sciences, “Evaluation of a proposal for reliable low-cost grid power with 100% wind, water, and solar”, by 21 prominent scientists taking issue with Mark Jacobson’s earlier study claiming that 100% renewables is feasible in the USA by 2050.  In a nutshell, the paper found many poor assumptions in the Marc Jacobson paper and ultimately finds that its conclusion that 100% renewables in the United States by 2050 is false.  And how does Marc Jacobson respond to this criticism?  Does he review his work, make changes and then show that his conclusion remains valid?  No, he does what some would do when their beliefs are under attack, he sues.  This is one of the most shameful episodes of the year.  A scientist suing when others disagree with him is just not the way things are done.  Science is about skepticism and continuous questioning.  A peer reviewed paper that is critical of another one is to be applauded and responded to, to continue the discussion.  Suing those who disagree is simply not one of the options.

Second, we saw Germany called out for its lack of progress on decarbonization in recent years while holding COP23 in Bonn late this year.  While massively investing in new renewables, these are unable to take the place of its closing nuclear plants, thereby making coal king in Europe’s most polluting nation.  This story shows how a 12-thousand-year-old forest that has been almost completely consumed by the country’s ravenous addiction to coal power.

Other countries have seen the light as well.  The UK is strongly committed to new build nuclear and Sweden and France have realized that removing nuclear from the mix will do nothing to achieve their climate goals.  In Korea, the public decided to continue with a new build going against its new government’s policy.

And finally, we saw something this past year, we have not seen before – the rise of the pro-nuclear environmental NGO – as those who care about the environment and climate change are starting to realize that renewables alone is a path to nowhere.  This includes such organizations as Environmental Progress, Energy for Humanity and Mothers for Nuclear.

A look at the 2017 edition of the World Energy Outlook tells an interesting story.

Source:  World Energy Outlook 2017

 

Even with massive investment in renewable technology, fossil fuels remain king in electricity generation by 2040 still producing about half of all global electricity.  Wind and solar increase to anywhere from 20% in the New Policy scenario to about a third of electricity generation in the Sustainable Development Scenario (the scenario that shows what can be done to meet Paris objectives).  This is even though wind and solar make up about 45% of the total investment in new capacity and global subsidy for renewables grows from about $140 billion per year to $200 billion.

Looking deeper at the numbers, it can be seen that this investment results in a huge increase in wind and solar capacity of 5000 GW in the Sustainable Development Scenario. All other things being equal, this same amount of energy would only have required about 1500 GW of nuclear to be built since a nuclear plant produces about 3 times more energy than an equivalent size of solar plant and more than 4.5 times as much energy as wind capacity.  And this is before any consideration of the intermittency of wind and solar and the needed improvements to systems to accommodate that – and of course the predominantly fossil backup needed for when the wind doesn’t blow, and the sun doesn’t shine.

What this shows is that wind and solar are good ways to reduce fossil use, probably by about 30% or so.  But they are not good ways to REPLACE fossil fuels in their entirety.  This must be done by more robust alternatives such as hydro and nuclear.  These are the only large-scale base load options that are both reliable and low carbon available today.

And what about storage?  Often, we hear that once storage technology improves, this will be what is needed for renewables to break free of their intermittency.  Of course, this sounds better than it actually is.  In reality, storage would be ideal for base load plants like nuclear where it can help store energy generated during times of low demand reducing the need to build new peaking generating plant.  On the other hand, storing enough energy from wind and solar would require massive overbuilding of capacity to collect extra energy during the 20% of the time the sun is shining and the 30%, the wind is blowing.

Changing beliefs is hard.   We live in a time when all opinions are considered valid, whether from experts or lay people.  And most of all, people are challenging expert views as never before.  Yes, it is a romantic view of the future to believe that all of our energy will come from energy sources such as the wind and the sun.  But beliefs don’t change physics and if we really want to change the world, we need more nuclear power to replace a large portion of today’s fossil generation.  Only then will we be on our way to a truly low carbon economy.  We are under no illusion that this change is coming quickly, but 2017 saw the start.  There are now cracks in the 100% renewable myth.  It will take hard work and ongoing support from the new generation of pro-nuclear NGOs to keep broadening the crack in 2018 – and who knows?  Maybe the tide will shift, and we will be on our way to a truly sustainable future.

Wishing you all a very happy and healthy new year!

Original Post

Content Discussion

Bob Meinetz's picture
Bob Meinetz on January 4, 2018

Milton, you don’t sing your own praises enough, but your columns here on Energy Collective are an inspiration to more than you know. Your work, along with that of Rod Adams of Atomic Insights and Dan Yurman of ANS Nuclear Cafe, fills a critical void in educating the public on humanity’s best chance to limit the effects of climate change.

I’d like to to credit some of the other unsung heroes down in the trenches, those who are attending hearings, speaking to the public, attending conferences, filing motions, filing protests, filing, filing, filing…people like Eric Meyer of Generation Atomic, inspiring America’s youth into taking action; like Bill Gloege, Gene Nelson, Abe Weitzberg, Alex Cannara, and Marty Marinak of Californians for Green Nuclear Power, a group with more advanced degrees than the Union of Concerned Scientists put together.

The list goes on and on…and the truth shall prevail.

Jarmo Mikkonen's picture
Jarmo Mikkonen on January 4, 2018

a nuclear plant produces about 3 times more energy than an equivalent size of solar plant and more than 4.5 times as much energy as wind capacity.

Wind and solar have probably switched places.

we saw Germany called out for its lack of progress on decarbonization in recent years while holding COP23 in Bonn late this year. While massively investing in new renewables, these are unable to take the place of its closing nuclear plants, thereby making coal king in Europe’s most polluting nation.

I would not go that far. Wind and solar have replaced nuclear generation in Germany which basically means no improvement climatewise.

The greatest drop in German emissions took place between 1990-2000 after German unification and closure of former GDR inefficient plants. Emissions dropped by almost 200 million tons on annual level.

Energiewende was launched in 2000 and the resulting drop in emissions has been around 100 million tons in 17 years. To achieve their 2020 target they should drop by an additional 150 million tons, in other words 50% more than has been achieved in the previous 17 years. To achieve their 2030 target, German emissions should drop by 340 million tons from the current level. While they simultaneously close 10 GW of emission-free nuclear capacity.

Good luck with that.

Walter Runte's picture
Walter Runte on January 4, 2018

It would be helpful to explain why it is that $8,000/kW – plus generation plants are to be considered economic, especially when combined with the enormous incremental infrastructure costs to accomodate a point source of 1 GW in an already constrained transmission environment.

Bob Meinetz's picture
Bob Meinetz on January 4, 2018

Gerry, in short – nuclear plants are economic because fuel costs are negligible and they last a long, long time. Unless shut down by fearful antinuclear zealots, there’s no reason they can’t be maintained and upgraded indefinitely.

We’re constantly being told “nuclear is uneconomic” – that doesn’t mesh with facts. In 2015, the marginal operating expenses of existing nuclear plants were 30% lower than coal, and 16% lower than natural gas.

https://www.eia.gov/electricity/annual/html/epa_08_04.html

Of course, appreciating nuclear’s benefits demands understanding of a long investment timeline, and understanding the long-term impacts of climate change.

Bob Meinetz's picture
Bob Meinetz on January 4, 2018

In response to your argument against our admittedly-constrained transmission environment – didn’t it only become a problem when electricity was deregulated, when “distributed generation” was promoted as a solution?

The reason point sources of energy are more efficient, cheaper, and less-polluting than many distributed sources has parallels in internet transmission, airline scheduling, and countless other disciplines which require dispatching a service or product most efficiently across a widely-dispersed customer base.

Thorkil Soee's picture
Thorkil Soee on January 4, 2018

100% Wind power in Europe
The net-page https://windeurope.org/about-wind/daily-wind/ , that radiates enthusiasm for wind power, gives an overview of the European wind.
Data for the first half of 2017:
– Capacity factor for onshore wind 23.5%
– Capacity factor for offshore wind 37.3%
– Offshore wind capacity 14.0 GW
– Onshore wind capacity 145.5 GW
– Maximum yield from wind February 22nd: 75 GW
It is easy to calculate the capacity factor for the “record day” February 22nd.
– 47% Not that impressive.
Of course, you cannot keep the heat on using electricity that was produced last month.
Therefore:
On the “Minimum days” the yield was 20 GW
– Corresponding to a capacity factor of 12.5%

Now it is tempting to consider “The Green Dream”, that is to provide power and heat exclusively from sun and wind.
So:
Without the help of polluting sources like coal and gas.
And, of course, not from the hated nuclear.

Thus, in order to maintain power 24-7-365, there must be available wind CAPACITY some 8 times the consumption.
Of course, these many wind turbines will stand idle for most of the time.
In addition, there is a need for a lot of high-voltage lines necessary to reconcile supply and demand across the many land borders.

Specifically, it means that if the wind power lobby boasts of that:
“Now it costs only 100 € / kW (capacity)”
Then the consumer must pay 700 € / kW EXTRA for the necessary overcapacity.
If solar power is included in the calculations, the situation is likely to worsen.

To avoid misunderstandings, I mention that even with the most optimistic projections it will not be possible to pay for batteries to save more than say 15 minutes of consumption, which can easily be necessary for more than a week.

Correct me if I am wrong

greggerritt greggerritt's picture
greggerritt greggerritt on January 4, 2018

Nuclear power is still just a cover for the nuclear war industry. And will never be accepted. It has been based on lies, including too cheap to meter, for 50 years. And it is still uninsurable. Besides being based on phony assumptions about future economic growth,.

Engineer- Poet's picture
Engineer- Poet on January 4, 2018

In reality, storage would be ideal for base load plants like nuclear where it can help store energy generated during times of low demand reducing the need to build new peaking generating plant. On the other hand, storing enough energy from wind and solar would require massive overbuilding of capacity to collect extra energy during the 20% of the time the sun is shining and the 30%, the wind is blowing.

This is a truth I’ve been trying to push out into the collective conscious for some time.  I am so happy to see it getting more (and hopefully louder) backing than just my voice crying in the wilderness.

Changing beliefs is hard. We live in a time when all opinions are considered valid, whether from experts or lay people. And most of all, people are challenging expert views as never before. Yes, it is a romantic view of the future to believe that all of our energy will come from energy sources such as the wind and the sun. But beliefs don’t change physics and if we really want to change the world, we need more nuclear power to replace a large portion of today’s fossil generation. Only then will we be on our way to a truly low carbon economy.

Remember, the “expert views” include Mark Z. Jacobson’s.  We are in exactly the situation that the anti-smokers were in against the “experts” retained by the Tobacco Institute.  These people need to be discredited and preferably disemployed by exposing their paymasters and conflicts of interest.

Nathan Wilson's picture
Nathan Wilson on January 4, 2018

“… explain why it is that $8,000/kW – plus generation plants are to be considered economic …”

Ok, using the other capital costs from Lazard 2017:
– $8 per peak Watt for nuclear is $8.89 per average Watt delivered (Watt_avg) at 90% CF (capacity factor). But that’s just the new units; they last 80 years (with just $1/Watt in repairs every 30 years, plus $1/W for decommissioning), so your fleet average cost is more like $4.1/Watt_avg.

– With wind-power at $1.45/Watt_peak and 35% CF (i.e. anywhere but sparsely populated central US), that’s $4.14 (double that for off-shore wind). New transmission additions will raise this by 20% or so. Also don’t forget you’ll need to balance the fleet with about 0.8 Watts_peak of fossil gas plants per average Watt, that’s another $1/Watt_avg; those gas plants will generate about the same amount of electricity as the wind-farms, using fuel that costs 2-3x the cost of nuclear fuel. Also, you’ll release enough CO2 to destroy the climate (i.e. there is a large external cost in this case).

Of course adding hydro, solar, and storage to the wind-rich mix will make it better, but that trick also makes the nuclear-rich grid better. Over all, the wind-rich grid is about 3x worse for using dirty flexible generation (fossil based), regardless of how cheap storage becomes.

Importantly, the cost of new (indigenous) nuclear in growing markets like China and India is more like $3/Watt_peak. Developing countries have been importing Russian and South Korean nukes for $4-5/Watt.

Most developing countries lack adequate fossil gas production, so they end up balancing their windpower with coal, which has high capital cost and low fuel cost, so it is not a cost effective combination (i.e. the windpower replaces cheap coal use, but they still need the expensive power plants for backup). The result is that they only buy a small amount of wind and solar, relying on coal for the rest, which again leads to the destruction of the climate, plus deadly air pollution (more external costs).

“…enormous incremental infrastructure costs to accommodate a point source of 1 GW…”

You mis-understand grids. The US has a 1000 GW grid, which is divided into a few dozen balancing areas of 30 GW or so each. In each balancing area, the financial people buy and sell electricity as they please, and assume their grid works like a “copper sheet”, so that any generator can serve any load. Only occasionally does transmission congestion block a sale of power. For this to work, the balancing area needs a high voltage backbone criss-crossing or looping around the service area, and that backbone needs to carry the whole 30 GW divided onto several short lines (of several GW each) plus a quarter or so of the 30 GW on a few longer lines. So to serve a 1 GW point-source, you might upgrade a few transformers or short links, but it does not cost much.

In recent years, these balance areas have been consolidating, which requires even more multi-GW long distance transmission. The purpose is to allow sharing of resources (spinning reserves, far away hydro, excess coal-power), and to smooth the flow of windpower (i.e. unrelated to large nukes), but it helps nukes too, since far away cities can buy power from a given nuke.

With windpower, you not only need normal transmission between cities, but also out to the wind-farms, which is more expensive than strengthening the local grid for new large point sources.

Jarmo Mikkonen's picture
Jarmo Mikkonen on January 5, 2018

The badly delayed EPR in Olkiluoto Finland is around 5300 euros/kW.

The only intermittent renewable that can work here is wind. Solar….a piece of news today told that there was a total of 16 hours of sunshine in Helsinki in December. In the middle of Finland the town of Kuopio had 0 hours of sunshine in December. If there is sunshine, it is bleak glow barely above the horizon….

Subsidized wind here costs 83,50 euros per MWh (the remuneration paid to generators). The existing wind capacity will cost taxpayers around 3 billion in subsidies. A recent study concluded that new nuclear costs 42.4 euroa/MWh in Finland. Taxpayers need not pay any subsidies for nuclear electricity. The risks are carried by private companies.

As a taxpayer, nuclear in Finland makes sense to me.

Jarmo Mikkonen's picture
Jarmo Mikkonen on January 5, 2018

Lazard’s latest LCOE analysis (unsubsidized costs) shows wind at $30-$60/MWh, solar PV at $43-53/MWh and nuclear at $112-183/MWh.

Fennovoima and TVO in Finland have told that their 2 new nuclear power plants LCOE is 45- 50 euros/MWh. Plant costs 7.12 and 8.5 billion euros.

Recently it was calculated that LCOE of onshore wind in Finland is 41 euros/MWh. However, a guaranteed price of 83,50 euros/MWh is needed before anybody will build and operate wind turbines. Why?

Craig Morris summed up the situation concerning wind and solar remuneration requirements in his Energiewende blog:

solar and wind cannibalize themselves. When the wind blows and the sun shines, more power is generated, so power prices on spot markets go down. If no payment is ensured for curtailment, it doesn’t matter how cheap solar and wind get; they price themselves out of the market. In other words, if you want wind and solar, you want guaranteed payments for them. Calls for them to make do with spot prices (and, eventually, forgo curtailment payments) are tantamount to saying, let’s just not have wind and solar, shall we?
https://energytransition.org/2017/06/new-proposals-would-kill-solar-and-wind-in-eu/

Walter Runte's picture
Walter Runte on January 5, 2018

Bob- when I speak about economics I mean real world economics. There are no 80 year old nuclear units and if there were you cannot depreciate them for that period of time. Under today’s accounting methods and today’s wholesale power markets they are not economic in the US. Investoirs need both a return on the capital as well as the fuel and operating costs. Looking at only marginal operating costs is the tip of the iceberg. That’s the sole reason why there are no buyers – US utilities have made their position known by what they purchase in the way of new generation. In other areas of the world, public perception does play a role. In the US, however, check out the Gallup polls beginning shortly after TMI- the degree of nuclear acceptance has been virtually the same even after Chernobyl and Fukushima.
As to transmission constraints, I believe you are mistaken. This is not a recent phenomenon and it has nothing to do with the influx of distributed generation. Take a look at PJM’s history. They have had severe constraints for 30 years. Transmission constraints, the penalty for which is a regular part of transmission costs, exist for two basic reasons: there is no national planning of the HV grid and the consequentily it is extremely difficult to construct new transmission across jurisdictions.

Nathan Wilson's picture
Nathan Wilson on January 5, 2018

This notion of fleet average cost is what determines energy costs from regulated public utilities. Affordable fleet average cost is also what NREL uses to argue that their high renewable penetration scenarios (in RE Futures) are affordable. For the nuclear case, I’m averaging costs from new and old plants. NREL averages costs for low penetration (w/ low integration costs) and high penetration renewables (i.e. with added storage and very high incremental curtailment). The difference is with nuclear, the same incentive program works at every penetration, but with renewables, new, stronger incentives must constantly be added to keep things going.

NREL also assumes that expensive renewable technologies like off-shore wind and concentrating solar (CSP) with storage will fall dramatically in cost with growing experience. Of course nuclear costs should also fall with growing build rate, and in fact we see this in China and Korea, where new nukes get built in 4.5 years, instead of the >12 year first-of-a-kind builds we see in the US and Europe.

We can also expect lower nuclear costs based on analyzing the amount of concrete and steel required to build the power plants. This report from UC Berkeley finds that nuclear plants use an order of magnitude less material, per unit energy delivered, than wind farms.

Walter Runte's picture
Walter Runte on January 5, 2018

Nathan- First, please see my response to Nathan above.
I’m not sure where you are getting your economics. Using G-4 ECONS (Oak Ridge’s model) an $8,000/kW installed cost for an AP1000 at 1.1 GW with ORNL’s other cost assumptions (many of which are too low) results in a levelized unit electricity cost of 24.07 cents/kWh.
While its true that China claims $3,000/kW installed costs they are rather opaque – it is not clear what is actually in those numbers or how they deal with other cost factors when the manufacturer, operator and regulator are all ultimately the same organization. Reactors in less developed countries face a rather different regulatory environment as well as opaque costs. More relevant costs are those currently being experienced in the US, Finland, and France.
As to transmission constraints, I would recommend looking at the triannual National Electric Transmission Congestion Study produced by DOE – the last one was issued in 2015. Take a look at the reported costs of transmission constraints in ISO-NE, NYISO, PJM, MISO and SPP. Also take a look at the maps of queued generation awaiting transmission evaluations. Plopping a GW into most grids where there is sufficient demand to consume a GW is not trivial.

Walter Runte's picture
Walter Runte on January 5, 2018

Jarmo- the 5300 euros figure was the Areva 2012 estimate – Flamenville or the estimates for Hinckley Point C may be more appropriate. Regardless, what is economic in Finland is likely not economic in some other countries.

Jarmo Mikkonen's picture
Jarmo Mikkonen on January 5, 2018

Gerry- the highest estimate I have seen in the Finnish media for Olkiluoto 3 lately has been 9 billion. That would translate to 5600 euros /kW.

The basic problem was that EPR design was not ready when the construction started. Areva thought they could wing it but failed. Fukushima modifications added to these problems.

Big projects go spectacularly over budget when there’s design problems and faulty construction. Sydney Opera House went 1400% over original budget and more recently, Berlin Brandenburg airport that was due to open in 2011 will hopefully open in 2021, with more than double the original cost.

I agree that economics of nuclear vary from country to country. The cost of Hanhikivi reactor has been given as 5900 euros/kW today in Finland.

Regardless of the cost of Olkiluoto 3, TVO will get the plant at a much cheaper price than 9 billion. The turnkey deal was for 3 billion and I doubt that Areva can twist it into 9 billion, however good their attorneys are.

Rudolf Huber's picture
Rudolf Huber on January 5, 2018

Sign me on – I think the currently spiralling cost of nuclear stems from the bloated and extremely op heavy Due Diligence process which does not aim to make the plant safer but rather to give everyone a voice and take care of any foible anyone might have. Politicians have no balls as they want everyone to harmoniously agree on everything when their job should be to cut the pie and stand up for the choice they have taken. Where are the principled stances?

Joe Deely's picture
Joe Deely on January 5, 2018

A lot of pricing discussion in these comments.

Xcel in CO recently had sent out an RFP to replace some of it closing coal generation. Here is a document describing some of the bids and the pricing. See Appendix A.

Definitely worth seeing what comes out of this RFP. The wind with battery storage pricing might be of particular interest to this discussion – $21 MWh. Still plenty of questions on exactly what all of these bids are composed of but still – good bye coal.

wind smith's picture
wind smith on January 5, 2018

I think your logic is not any better than the DOE 90 day fuel rule to save coal from an agonizingly slow death that is opposed by most if not all experts on regional generation and grid reliability.

Willem Post's picture
Willem Post on January 6, 2018

Hi Milton,

Several years ago, I wrote an article debunking Jacobson and his WWS mantras.
We had an email back and forth.
I brought to his attention his reliance on CSP storage in the US southwest would not work, unless there were a nationwide HVDC system to cover all of the US, as an overlay system, connected at many points to existing grid systems, to instantly distribute electricity to where it is needed, 24/7/365, year after year.
Such a system would cost at least $400 billion.
He did not have it in his cost estimate; at least I could not find it.
In my judgement, he
Underestimated wind and solar capital costs/ MW.
Overestimated wind and solar capacity factors
As a result his capital cost was about 2/3 of my estimate, which would greatly increase the cost of energy/kWh of the WWS approach.
All is explained in this article:
http://www.windtaskforce.org/profiles/blogs/review-of-the-100-re-by-2050-plan-for-the-us-by-the-jacobson

Willem Post's picture
Willem Post on January 6, 2018

Keith,
Lazard and Bloomberg are financial outfits that put out numbers to entice investors into Re systems, Serious engineers do nor use those rah rah numbers.

In Vermont (New England), the cost of solar is being bandied about by RE folks as being almost on par with fossil. A bigger lie was never told.

The below comments are fully explained in this article:
http://www.windtaskforce.org/profiles/blogs/subsidized-solar-systems-cause-chronic-budget-deficits-in-vermont

Electricity Cost During 25 Years of Operation: Large-scale solar projects usually are financially structured in three phases. Phase 1 covers the first 6 years; phase 2 years 7 – 18; and phase 3 years 19 – 25.

Phase 1, year 1 – 6: Dividing the “Subsidy costs” and the “Excess paid above NE midday wholesale prices” by the 6-y production yields 14.0 c/kWh and 7.0 c/kWh, respectively, and adding the 6.0 c/kWh for NE midday wholesale, yields a total production cost of 27.1 c/kWh, during the first 6 years of operation.

Phase 2, year 7 – 18: The remaining subsidy is the “Excess paid above NE midday wholesale prices” of about 7 c/kWh. Adding other costs, such as paying off long-term loans, the production cost decreases to about 9.8 c/kWh

Phase 3, year 19 – 25: The remaining subsidy is the “Excess paid above NE midday wholesale prices” of about 7 c/kWh. Adding other costs, the production cost decreases to about 8.2 c/kWh.

The weighted average price of all 3 phases is about 13.5 c/kWh. See table 3.

Electricity Cost During the First 6 Years of Operation: If, on average, four 2000 kW SO solar systems were placed in operation in each year, 24 systems would be in high energy cost mode at any time (the first 6 years), producing 24 x 16,558 = 397,392 MWh, at a cost of $107,295,840, at 27.1 c/kWh, which could have been bought for $23,843,520, at NE midday wholesale price of 6.0 c/kWh, then the excess cost difference is $83,452,320.

Having solar systems instead of buying at midday wholesale prices, costs an extra $83,452,320, during the first 6 years of the operation of the projects. The cost is borne by the federal and state governments and by Vermont ratepayers; the cost to Vermont ratepayers is reduced from 13.5 (the price at which the utility buys) to 10.5 c/kWh by selling RECs. See table.

Nathan Wilson's picture
Nathan Wilson on January 6, 2018

‘… “experts” retained by the Tobacco Institute.’

Yes, but the difference is that “tobacco safety experts” where honest in admitting their financial connection to the tobacco industry.

In contrast, many (if not all) opponents of nuclear power have a dark secret motivating their opposition: irrational fear of radiation. It it truly horrifying for example, that the Fukushima disaster, in which 16,000 people died in a tsunami, is most remember for the subsequent nuclear accident which killed no one. And to appease the public, the government ordered an evacuation that killed 1600 more, then a return to coal power that continues to kill many dozens more each year (as well as crippling the economy with an extra $20-40 billion every year in wasteful fossil fuel purchases to replace the output of idled nukes).

Bob Meinetz's picture
Bob Meinetz on January 6, 2018

Gerry, transmission in the past has been constructed specifically to accommodate generation as much as consumption. It’s most efficient that way, for the reasons outlined above. Analogous problems exist with transportation: when economic activity moves from the center of a city to suburbs, highways and train routes intended to serve an influx of workers each morning are empty, while suburban thoroughfares are increasingly constricted.

There is no national planning for an HV grid because FERC has neither the budget nor the resources to regulate it. And yes, it will require more regulation of interstate energy holding companies and the antitrust muscle of the SEC. In our anti-regulatory political environment, we won’t see that anytime soon.

Public perception does play a role in acceptance of nuclear, as it plays a role in addressing climate change. Raising the questions: do we submit to irrational fear for judgment on critical policy issues, or do we base our policy on rational analysis by experts? Do we submit to short-term investment timelines for decisions with profound effect on climate, or do we have the collective attention span to consider what kind of world we want for our kids, and theirs, and theirs? Lead, or follow?

Bob Meinetz's picture
Bob Meinetz on January 6, 2018

Gerry, is purchasing thousands of miles of easements across state lines, then plopping thousands of miles of HV transmission atop it, somehow more trivial than building regional generation and transmission as needed in markets already regulated by state PUCs?

Bob Meinetz's picture
Bob Meinetz on January 7, 2018

Keith, why would you trust an investment bank for reliable LCOE estimates? Lazard manages $billions in renewables investments – of course their “analysis” is going to underplay wind’s costs, and overplay its value.

If I ask Frito-Lay whether Cheetos are a tasty, wholesome snack, it’s not too hard to predict what their answer might be.

Walter Runte's picture
Walter Runte on January 8, 2018

Rather bizare analysis. Vermont has no fossil generation https://www.eia.gov/state/?sid=VT#tabs-4 . VT average nodal LMP from ISO-NE at noon today is a little over 18 cents/kwh. Why the price? Because 30% of generation right now in the ISO is oil. Total fossil is 55%. At least a portion of that is being offset by cheaper wind and solar.

Walter Runte's picture
Walter Runte on January 8, 2018

Bob- I agree that such infrastructure is not trivial, especially to accomodate large central generators in congested transmission networks and that regional, load matched distributed renewable generation is a better solution. If we’re talking about an ideal future: 1) invest in smart tech for transmission and get enormous efficiency yields, maximizing ability of existing T to perform and eliminating need for new generation for quite some time; 2) consider investments in HVDC linkages among the reliability councils to achieve a true national grid to make the most of what is already there – Europe is piecing one together; and 3) get utilities to understand that, at least in most developed countries, the central generation paradigm is an anachronism (why US right wing politicians are not screaming for distributed, locally owned and regulated generation is hard to fathom, given its compatibility with their ideology).

Joe Deely's picture
Joe Deely on January 8, 2018

Willem, Bob – I don’t necessarily trust Lazard’s (or any other investment bank) unless their comments are supported by real life evidence. The market has seen numerous PPA’s for onshore wind in North America at unsubsidized costs in the $30-$60/MWh, so if utilities are buying wind at those prices in an open RFP, then that tends to support their analysis.

Exactly. Not that hard to see where prices are currently and where they are going – at least for wind and solar.

As I mentioned in comment below here is a set of prices from recent Xcel RFP in CO (Dec 2017). See Appendix A – note that prices are for the Median.

If anything Lazard prices are too high.

Bob Meinetz's picture
Bob Meinetz on January 8, 2018

Keith, until the public can select the companies which generate their electricity, the notion there are “open markets” in electricity is a myth. Electricity utilities are monopolies as far as the public is concerned and will remain that way.

In 1935 FDR realized monopolies made the public susceptible to exploitation, and signed legislation to prevent it. Effective for seven decades, it was repealed in 2005. Why? Either the Bush Administration, in concert with oil interests, believed human nature had fundamentally changed in that time, or they saw an opportunity to rely on another fundamental characteristic of human nature – forgetfulness – to exploit the public exactly the way it had been in the 1920s.

Until we’re willing to re-regulate the multi-state energy holding companies in charge of our electricity, implementing a revenue-neutral carbon tax like the one in British Columbia will remain out of reach. Because imposing such a tax is anathema to American venture capitalism and open markets, I’m not holding my breath.

Bob Meinetz's picture
Bob Meinetz on January 8, 2018

Gerry, Vermont only generates 35% of its own electricity, and about a third of that comes from chopping down trees and burning them – disingenuously labeled “biomass”.

The rest is mostly methane generation from the U.S. grid and Canada – an outcome guaranteed when Canadian fossil fuel giant Gaz Metro bought Green Mountain Power, and had Vermont Yankee Nuclear Power Plant shut down. A tiny portion of that is being offset by wind, and an even tinier portion by solar.

Rex Berglund's picture
Rex Berglund on January 8, 2018

Lazard’s discount rate is 9.6%, unrealistically high. They offer a chart with different costs of capital, and admit that 9.6% is unrepresentative today, but they keep it to preserve comparability from year to year.

Rex Berglund's picture
Rex Berglund on January 8, 2018

Utility Dive points out : The median price bid for wind-plus-storage projects in Xcel’s all-source solicitation was $21/MWh, GTM Research’s Shayle Kann noted on Twitter, and the median bid for solar-plus storage was $36/MWh. Previously, the lowest known bid for similar solar resources was $45/MWh in Arizona.

Willem Post's picture
Willem Post on January 8, 2018

Gerry,
Government idiots, prodded by RE aficionados, prevent the building of gas lines.
Hence a shortage of low cost gas and expensive oil has to be used; most generators can use gas and oil.
The prices I have in my comment are annual average prices.
They have nothing to do with LMP spot prices.
The purpose of my analysis is to show New England solar is much more expensive than some prices being bandied about in press releases.
I look forward to your comment after you read my article

Walter Runte's picture
Walter Runte on January 8, 2018

Bob- you’re right – there are no “open markets” in the classic sense. Every form of generation benefits enormously from direct and indirect subsidies as well as discouraging and encouraging regulation, so no one pays the real cost of energy. But there are energy and electricity markets that function according to a certain set of rules. The long standing rules were lifted because from PUHCA in 1935 to PURPA in 1978 they became increasingly irrelevant and only applicable to a minority of utilities. Generation got unbundled from vertically integrated utilities, unregulated generation owners entered the market and retail electricity became deregulated. “Multi state holding companies” now only have sway over 28% of US electricity customers, so federal “reregulation” even if warranted, would not solve the problem. The problem is at the wires company level and state regulators who, together with distribution utilities, have created a set of regulations that bar, block and discourage distributed generation and/or block the wires company from owning any (which could be a very useful network reliability enhancement). As a result, US residential customers pay nearly double for solar installations compared with other countries because of these regulations. https://www.greentechmedia.com/articles/read/how-to-halve-the-cost-of-residential-solar-in-the-us?utm_source=Daily&utm_medium=email&utm_campaign=GTMDaily#gs.aowk9qA But this situation is, in fact, changing in certain key leadership states that are now recognizing the role of DER – see NY’s Reforming the Energy Vision Program or California’s Distributed Energy Resources Action Plan. Sooner or later the US will get it right, at least in certain regions. The central generation model was great in 1935 and served its purpose for 50 years; it is no longer useful and is dying a slow death.

Engineer- Poet's picture
Engineer- Poet on January 8, 2018

I am increasingly sensitive to greenwasher propaganda being repeated uncritically and spread virally.  It’s distinguishable by its self-contradictions and doctrinaire talking points.  This smells like it to me:

such infrastructure is not trivial, especially to accomodate large central generators in congested transmission networks and that regional, load matched distributed renewable generation is a better solution.

This single sentence requires a great deal of work to deconstruct:

A.  “large central generators in congested transmission networks” is generally an oxymoron.  The traditional way grids were designed was to place generation near loads and only interconnect networks to achieve economies from different load peaks and ability to share spinning reserve.  Only now that those interconnects have been tasked with carrying unreliable flows of power from far away “renewables” have they become congested.  They have also become unable to serve their original purposes because they’re already run to capacity much of the time and have nothing to spare.

B.  “regional” I will get to later.

C.  “load matched distributed renewable generation” is a straight contradiction.  “Renewables” (wind and solar PV) are not dispatchable and canNOT match load.  The current fad is to force load to match the un-dispatchable generation.  Nobody has actually made this work.

If we’re talking about an ideal future: 1) invest in smart tech for transmission and get enormous efficiency yields, maximizing ability of existing T to perform and eliminating need for new generation for quite some time;

D.  As of recently, the US grid delivered 93% of all generation to customers.  Improving on the 7% losses is certainly possible, but the maximum improvement is small.  There’s no apparent advantage in things being “smart”, and “smartness” creates parasitic loads in the computation and communication systems.  It also creates privacy and security problems that do not exist in “dumb” systems.

2) consider investments in HVDC linkages among the reliability councils to achieve a true national grid to make the most of what is already there – Europe is piecing one together;

E.  Note the contradiction with point B above.  Any scheme which requires a continent-spanning HVDC network to even out variations is completely at odds with anything “regional”.

F.  It’s also a massive investment that doesn’t generate a single joule, and long-distance transmission is lossier than local connections which contradicts the goal put forth in D.

3) get utilities to understand that, at least in most developed countries, the central generation paradigm is an anachronism

G.  Completely wrong.  The central generation paradigm works extremely well.  However, it is contrary to the (unstated, dishonest and environmentally criminal) goal of eliminating nuclear power.

(why US right wing politicians are not screaming for distributed, locally owned and regulated generation is hard to fathom, given its compatibility with their ideology).

They know when they’re being sold a bill of goods, even when it’s dressed up in trendy buzzwords.

Mark Heslep's picture
Mark Heslep on January 8, 2018

Global nuclear overnight build costs for seven countries going back 4-5 decades.

https://uploads.disquscdn.com/images/5797068be89657537649a19cdf7e8f94fa553a0c8220ee7f1ceaea5042633d95.png

(Source)
Note in particular the most recent KEPCO builds in S. Korea at $2K/Watt. KEPCO is building four reactors in the UAE at $3.6/Watt (inc finance costs). (Source)

One likely conclusion from the data is that building standardized designs repetitively with several builds in the queue reduces costs.

Mark Heslep's picture
Mark Heslep on January 8, 2018

LBNL study of transmission cost for various wind projects

https://uploads.disquscdn.com/images/0cafaa2e9ab711722b4fc5d7233bb2c07d8de6cc5e5de252d7720b24b26a34d4.jpg

(Source)

Bob Meinetz's picture
Bob Meinetz on January 8, 2018

Gerry, which developed countries make up the basis for your claim the central generation paradigm is an “anachronism”?
Certainly not Germany, where even the most stalwart Energiewende enthusiasts depend on lignite coal – and nuclear – to keep the lights on in winter when sunny days can be as infrequent as one per month.
Certainly not France, where nuclear has provided 75% of EDF’s electricity for thirty years without generating an ounce of atmospheric carbon.
I think even US right wing politicians realize turning the generation of electricity into an unregulated free-for-all, dependent on the whims of weather, would be disastrous for both the environment and business.

Nathan Wilson's picture
Nathan Wilson on January 9, 2018

Unsurprisingly, the Xcel report does not say how much storage (hours) is included with the wind/solar plus storage bids, and of course they do not state the resulting effect on output capacity factor. It is telling though, that even with storage, the renewable bids are kept separate from the dispatchable bids (i.e. renewables bid for energy: $/MWh, the dispatchables bid for capacity $/kW-month).

Again, renewables are used to reduce fuel use in our fossil fuel dominated grid, not replace fossil fuel generators or remove fossil fuel dominance.

Bob Meinetz's picture
Bob Meinetz on January 9, 2018

Rex, you’re relying on “Utility Dive” and “Greentech Media” to verify Lazard’s figures?

That’s a laugh – with both profiting from the same gravy train as Lazard, it’s like asking a stoned roommate to verify whether Cheetos are wholesome or not.

Bob Meinetz's picture
Bob Meinetz on January 9, 2018

Gerry, the chorus that PUHCA has become “increasingly irrelevant” came from utilities, not distributed generation. Like all good venture capitalists, utilities hated oversight – and PUHCA was devastatingly effective. By 1949, energy holding companies ceased to exist.

Are 28% of US electricity customers now under the sway of holding companies? A source for your figure would be welcome – nationwide, I happen to think you’re 2-1/2 times too low. In California, save for a few desert-dwelling solar hermits, very close to 100% of electricity customers are under the sway of either Edison International, Pacific Gas and Electric Corporation, or Sempra Energy. Though my municipal utility generates some of its own electricity, it’s 100% dependent on natural gas from Sempra’s subsidiary “Southern California Gas Company” – see how that works? PUHCA was specifically designed to prevent companies which owned both electricity and natural gas subsidiaries from exploiting their stranglehold on electricity ratepayers, and if anything it’s more relevant now than ever.

Under Reagan’s free-market leadership in the 1980s, exemptions from PUHCA began to be granted for various political favors. One of the first was to a company named Enron – we both know how that worked out. Then, when PUHCA was replaced by the 559-page Energy Act of 2005, state PUCs were supposed to assume responsiblility for the inerests of ratepayers, but utilities were overjoyed. In California, energy surpassed healthcare to become the biggest source of paid influence and lobbying in the state. Ratepayers, be damned.

In the 12 years since the demise of PUHCA, the cost of electricity in the U.S. has skyrocketed by 40%. Whether it’s justified by expenses or not (I happen to believe, at least in part, it is) is that supposed to be an improvement?

A former FERC regulator with whom I’ve been corresponding believes it will be disastrous: as renewables advocates in their private DER heavens realize they can’t charge their iPhones after the sun goes down, they will buy natural gas generators for backup (it’s already happening). Still dependent on their utility for natural gas, the price of “cheap natural gas” will go through the roof. Ratepayers, and the environment, be damned.

Joe Deely's picture
Joe Deely on January 9, 2018

Rex,
Important to note that these are the “median” price of bids submitted. Also, large number of bids – not just one or two outliers.

Will be interesting to see how much storage is included on w/storage bids.

These prices are cheaper than running coal plants in CO. Coal is dead there.

Would love to see all utilities/states doing these RFPs.

Joe Deely's picture
Joe Deely on January 9, 2018

Bob,
Actual bids from an RFP for a large multi-state utility.

Xcel will be replacing coal generation with one of these bids. Will be hard for any utility in CO to justify using coal for current generation when they can get lower prices. PUCs in all the Western states should be following this process closely.

Next up to the plate – PNM in NM. Let’s see what kind of bids they get for their RFP.

Public Service Company of New Mexico (PNM) has issued a request for proposals (RFP) for 456 MW of resources identified in the 2017 – 2036 Integrated Resource Plan (2017 IRP) under the assumption the San Juan Generating Station does not continue to operate post 2022. PNM is encouraging renewable and battery storage options beyond those

identified in the 2017 IRP.

Walter Runte's picture
Walter Runte on January 9, 2018

Bob- suggest you read the details of the analysis that Willem summarized above.

Walter Runte's picture
Walter Runte on January 9, 2018

Willem- the problem with new gas pipelines is that they are a short term measure that increase carbon emissions and, longer term, face economic risk when cheap shale gas diminishes. The better long term view avoids them altogether. And some also argue the constraints that currently exist are the result of manipulation (https://www.utilitydive.com/news/eversource-avangrid-artificially-constrained-gas-pipeline-capacity-for-yea/507018/) I did read your article. I quoted the current ISO-NE LMP midday prices at 18 cents because that was your reference point. If you used 7 pm the wholesale price at VT take off points doubles. Using annual average wholesale prices is entirely inappropriate because it is the temporal value of solar and wind that is important – you’re doing an apples and oranges comparison. In addition, all your quotes from Warren Buffet were fine for when they are made, but wind no longer needs incentives to be economic.

Rex Berglund's picture
Rex Berglund on January 9, 2018

Joe yes, having received > 400 proposals the median bid price for solar+storage was 20% lower than the absolute lowest bid price just 7 months before, not just great prices, great price trends!

Walter Runte's picture
Walter Runte on January 9, 2018

Bob – don’t know where you are getting your info. Holding companies did not die in 1949. There are currently 31 electric utility holding companies. I worked for one from 1975 – 1997, and it still exists in the form of First Energy.
The source for the 28 % is the Edison Electric Institute – the investor owned utility (IOU) lobbying organization.
PG&E, Edison, Sempra have 11.4 million of the total 14.8, or 77%, not 100%. And while they provide the wires, they are increasingly not providing the energy – California regulators believe that by 2020 85% of IOU customers will get their energy from entities other than their wire provider: https://www.greentechmedia.com/articles/read/california-utilities-are-losing-customers-in-droves#gs.1eH6n6U
PUHCA began to be eroded by PURPA which came during the Carter administration. It assisted in accomodating NUGs- non-utility generating stations, the forerunners to independent generating companies.
Accodring to the EIA, average US electricity cost was 8.1 cents/kWh; in 2017 it was 10.6 – an annual increase of 2.3%, or about the same as inflation.
Glad your friend is a former regulator and not currently with the commission. Fortunately the current regulators had enough integrity to block the Trump regimes attempt to subsidize coal and nuclear.

Walter Runte's picture
Walter Runte on January 9, 2018

I’m increasingly sensitive to uninformed assertions that are then spread virally to fuel other’s confirmation biases.
A. To clarify- if you have an exisitng transmission network that is already facing constraints within itself and in its connections to other grids, siting new large generators in that network requires significant upgrades and enhancements, otherwise the new generator’s output is constrained and potentially stranded. Transmission constraints have existed in the US midwest, middle atlantic and new england states for 40 years and have just gotten worse.
C. Regional load matching means that if you anticipate a MW of new demand, that’s all you construct. You do not install 20 MW with the hope that someday demand will materialize to take that capacity. This is basic system planning and no contradictions were uinvolved. NB- wind and solar are not the only forms of distributed generation.
D. Improvements in transmission efficiency with smart technology go well beyond simple line losses. Read about them here: https://energy.gov/sites/prod/files/2015/04/f22/QER%20Analysis%20-%20Opportunities%20for%20Energy%20Efficiency%20Improvements%20in%20the%20US%20Electricity%20Transmission%20and%20Distribution%20System_0.pdf
E. There’s no contraditions. You missed the key phrase “make the mosat of what is already there.” HVDC links are short runs that interconnect HVAC networks, not major infrastructure build outs. There’s one being coinsidered in the US that links three reliabiity councils – go look up Tres Amigas Super Station.
F. No massive investment required, and cost justified with the enhanced efficiencies achieved.
G. Fact: the only paradigm under which nuclear power thrives is central generation. And, in fact, the paradigm, as implemented in the US, and the utilities who participate in it, make up the closest thing to socialism we have, so please explain why the right wing is so supportive of something that is so contrary to their alleged ideology?

Walter Runte's picture
Walter Runte on January 9, 2018

I should have said that central generation is becoming increasingly anachronistic. Witness these trends- the dawn of distributed energy resource based regulation has occurred in several states; the lack of a market for traditional large scale (>900 MW) units of any technology; and the nearly complete decoupling of wires providers from energy providers. What’s left is a network of wires companies and independent, unregulated providers of energy. Given the inability to construct large scale transmission projects, DER represents the rational future. As to Europe, see https://ec.europa.eu/energy/sites/ener/files/documents/5469759000%20Effective%20integration%20of%20DER%20Final%20ver%202_6%20April%202015.pdf

Walter Runte's picture
Walter Runte on January 9, 2018

Mark: It should be noted that in October Korea decided to discontinue its domestic nuclear program, cancelling all planned or under construction nuclear units with the exception of Shin Kori 5 and 6. Those units are about 30% complete. The Korean government wants to achieve 20% renewables by 2030. The UAE unit to which you refer, Barakah Units 1 – 4, are estimated to cost $30 billion (assuming the forecasted budget is achieved) resulting in an installed cost of $5.7/watt.

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