This group brings together the best thinkers on energy and climate. Join us for smart, insightful posts and conversations about where the energy industry is and where it is going.

10,243 Members

Post

Are We Dialing Down Nuclear Power at Precisely the Wrong Time?

FTI Journal Nuclear Power CPP Image

When it comes to the future of nuclear energy, the EPA’s mandate to reduce CO2 emissions from power plants is well intentioned but could result in cost hikes for consumers. Here’s why.

President Obama’s Climate Action Plan, issued in June 2013, outlined a broad array of actions intended to reduce greenhouse gas emissions that contribute to climate change and negatively affect both the environment and public health. One of the plan’s goals was to reduce CO2 emissions from power plants. To do this, Obama issued a Presidential Memorandum that directed the U.S. Environmental Protection Agency (EPA) to establish carbon emission guidelines for modified, reconstructed, and existing U.S. power plants.

From this mandate, the EPA developed the Clean Power Plan (CPP). Applying the Clean Air Act, the CPP directs states to establish standards of performance that reflect the degree of emission limitation achievable through the application of the “best system of emission reduction” (BSER). The BSER is the combination of emission rate improvements and limitations on overall emissions that would reduce emissions from the power sector by 2030 to 30 percent below 2006 levels.

While President-elect Donald Trump has indicated he wants to rescind the CPP, the challenges and political fallout associated with complete nullification could be quite extreme. Conventional wisdom expects that the new administration most likely would weaken the CPP, or replace it with a new, diminished standard.

One of the many criticisms of the CPP has been the EPA’s assumption that carbon-free nuclear power would increase slightly to 98.7 gigawatts (GW) in 2030 from 2016’s 96.8 GW. This is an important assumption for two reasons. First, nuclear’ s carbon-free emissions keep the CPP’s projected compliance costs low. Second, the EPA excludes existing nuclear units from its CPP emission goal-setting calculations.

There is, however, a problem with the EPA’s assumption on future nuclear capacity.

Nuclear plants, which today provide 20 percent of U.S. electric power and 62 percent of U.S. carbon-free electric power, are disappearing – through closures and early retirement – at a faster rate than the EPA forecasted due to a variety of economic, regulatory and political factors. Therefore, to comply with the CPP, new natural gas, wind and solar capacity will need to be installed to replace the dwindling nuclear power capacity. And a heavier reliance on natural gas – historically an energy source with significant price swings often tied to unpredictable weather events – could raise electricity prices, especially in northeastern states, where natural gas supply is very much constrained.

FTI Consulting, using its PLEXOS electricity model, found that current nuclear capacity would need to be preserved for the CPP’s goals to be achieved without a significant rise in wholesale electric prices in the Eastern Interconnection. Stretching from Kansas to Virginia and from Florida to most of Canada, the Eastern Interconnection provides 88 percent of U.S. nuclear generating capacity and is one of the three transmission grids in the United States and Canada (the others are the Electric Reliability Council of Texas [ERCOT] and the Western Electricity Coordinating Council [WECC]).

Without nuclear energy, achieving the EPA’s CPP carbon reduction goals at best may be difficult and may only be achievable by placing significant economic burdens on energy operators, consumers and the U.S. economy.

Challenges Facing the Nuclear Industry

There are currently 61 nuclear power plants (with 99 reactors) operating commercially in 30 U.S. states.

Soon, there will be many fewer.

One vector of pressure on the nuclear industry is economic. Natural gas prices have fallen dramatically over the last seven years. In March 2016, they dropped to their lowest level ($1.57 MMBtu) since 1998. Because natural gas prices often set the marginal cost of supply during peak periods, wholesale electricity prices have fallen considerably, too. As such, nuclear plants have seen their profits squeezed and many nuclear plants are not generating enough gross margin from markets to cover their fixed cost of operations.

Regulatory efforts intended to encourage the development of alternative energy sources represent a second vector of pressure that is problematic for the nuclear industry. Renewable energy tax credits, which are unavailable to the nuclear industry, incentivize the development of solar and wind. These resources alter the supply curve by adding more capacity that is dispatched at no cost, further lowering wholesale market prices and squeezing nuclear profits.

The third vector is political. The 2011 Fukushima incident, combined with environmental concerns about water usage and nuclear waste management, have led to widespread activist opposition to nuclear power. Simply put, nuclear energy is becoming more unpopular with larger swathes of the public and therefore unpopular with politicians.

Not surprisingly, companies are responding to these economic and political pressures by closing nuclear plants – in many cases before their licenses to operate are set to expire.

For example, Entergy closed its 0.6 GW Vermont Yankee plant at the end of 2014, even though in 2011 the Nuclear Regulatory Commission had extended its license for another 20 years. Three additional plants in California, Florida and Wisconsin – with a combined capacity of 3.7 GW – closed in 2013. On Oct. 24, 2016, the Omaha Public Power District closed the 0.5 GW Fort Calhoun plant.

Already announced retirements amount to 8 percent of total current nuclear capacity. Exelon, which had reached an agreement with New Jersey to cease operations at the 0.6 GW Oyster Creek facility by 2019, announced in June 2016 plans to close its Illinois Clinton and Quad Cities nuclear plants in 2017 and 2018, respectively, for economic reasons. The company claims to have lost $800 million over the last seven years on the two plants, which represent 2.9 GW of capacity.

The drumbeat of premature retirements continues, and the shrinking of U.S. nuclear capacity proceeds apace. Entergy announced in April 2016 that it will close the Pilgrim plant in Massachusetts (and its 0.7 GW of capacity) in 2019. In June, PG&E withdrew its 20-year license renewal application for its 2.2 GW Diablo Canyon reactors in California.

Because the EPA did not categorize existing nuclear plants under its “best system of emission reduction,” these plants cannot be counted toward the clean energy mandate, which does not make matters easier for the nuclear industry. (Only the five new reactors under construction and being commissioned will fall under BSER, as compared to 99 reactors that will not.) And the relicensing of existing nuclear plants is precluded from BSER classification as well.

Therefore, in an energy environment in which low-cost nuclear is being replaced by natural gas and renewables, carbon prices inevitably will rise if the CPP’s 2030 emission target is to be met. And given the deteriorating economic and political condition of the nuclear power industry, it can no longer be assumed that all of existing nuclear capacity will endure to provide carbon-free emissions during the CPP compliance period.

At the very least, this calls for a reassessment of the CPP modeling.

Modeling the Importance of Nuclear in Keeping CPP Compliance Costs in Check

FTI applied the PLEXOS electricity model to assess the impact of accelerated nuclear plant closures on electricity prices in the Eastern Interconnection through 2035 under the CPP. We modeled two cases to understand the price impacts of nuclear plant closures under the CPP.

In the Baseline Case, we assumed a nuclear capacity outlook that closely reflects EPA’s assumptions in its CPP modeling. It assumes 2016 nuclear capacity – along with reactors under construction – remains in place through 2035. In the Baseline, recently announced retirements and closures do not occur; new units currently under construction continue as planned in 2019 and 2020, and older plants will remain open beyond 60 years or will be replaced.

In the Alternative Case, we assumed that nuclear units will retire whenever their existing licenses expire; the retirements already announced will occur as planned; nine nuclear reactors considered at risk for political and economic reasons will be closed by 2022; and new units currently under construction will come online as planned in 2019 and 2020.

In the Alternative Case, even if those new units come online in 2019 and 2020, 24 percent of current nuclear capacity will be gone by 2025, and by 2035 only 51 percent of current capacity will remain.

It should be noted that our CPP modeling assumes the New Source Complement provision, where new fossil units are covered under the regulation. Our modeling also does not allow for the trading of emission permits between or among states, nor does it allow for the banking of emission permits.

The Cost of Compliance

Our analysis shows that compliance with the CPP will become much more expensive in the Alternative Case. CPP carbon prices in the Eastern Interconnection would rise an average of 26 percent between 2022 and 2035. And as nuclear carbon-free generation is lost, it will be replaced by natural gas, increasing emission levels as renewable capacity cannot be built realistically with the scale or cost effectiveness to replace the retired nuclear capacity.

In other words, losing the carbon-free energy generated by nuclear plants will increase the cost of CPP compliance. This cost will be passed along to consumers as wholesale and retail energy prices rise, hurting the whole U.S. economy. Wholesale electricity prices in the Alternative Case are 6 to 8 percent higher than the Baseline Case from 2022 to 2032. By 2035, prices are nearly 15 percent higher compared to the Baseline Case.

Based on our modeling, we believe the EPA’s Baseline assumptions considerably understate the CPP’s potential price impacts.

Price increases will be more dramatic within certain regional markets. For example, electricity prices in New York will be higher as the Indian Point, Ginna, and James A. FitzPatrick plants are all assumed to be retired before 2018. Indian Point is operated by Entergy, and its CEO has said the company is assessing all its assets due to “the financial challenges our merchant power plants face from sustained wholesale power price declines and other unfavorable market conditions.”

On average, New York will experience an average 18 percent rise in wholesale prices between 2022 and 2035. Not coincidentally, in August 2016 New York State’s Public Energy Commission proposed $500 million in subsidies aimed at keeping the Ginna and Nine Mile Point plants operating after their retirement dates. The Commission said the subsidies would cost New York utility rate payers $962 million over two years, beginning in 2017. Exelon, which operates Ginna and Nine Mile Point, would receive the bulk of the subsidies and has pledged to invest $200 million in the spring of 2017 if they are approved.

What Can Be Done?

The first step to remediating a problem is recognizing it. The impact of nuclear retirement on stated CPP targets must be met with better data and better modelling.

Next, EPA’s modeling of the CPP should reflect current realities. Subsidies (such as those proposed in New York) will help nuclear operators get through present economic difficulties, but they are temporary and are being challenged in courts. It would be better for EPA to recognize that the current cost structure of nuclear energy in its modeling does not properly compensate operators. It needs to fix that.

Nuclear generation is carbon free. It is unfortunate that the CPP does not recognize that relicensing nuclear plants avoids the addition of fossil fuel-fired power plants. Because it doesn’t, the EPA excludes nuclear plants undergoing relicensing from receiving economic credits for their carbon-free contributions to the U.S. energy system.

Conversely, removing all tax credits would create an even playing field for gas, coal, renewables, nuclear and all other technologies, allowing nuclear to compete more successfully.

These are possibilities, not suggestions, but without some sort of action, FTI Consulting’s analysis indicates that the EPA has underestimated the cost of meeting its CPP goals, and the U.S. economy – and rate payers – ultimately will bear that burden.

Ken Ditzel is Managing Director in the Network Industry Strategies practice in Economic Consulting at FTI Consulting. Rob Fisher is Senior Director in the Network Industry Strategies practice in Economic Consulting at FTI Consulting.

Read the original post on FTI Journal.

FTI Journal's picture

Thank FTI for the Post!

Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.

Discussions

Jarmo Mikkonen's picture
Jarmo Mikkonen on Jan 5, 2017 4:36 pm GMT

Nuclear generation is carbon free. It is unfortunate that the CPP does not recognize that relicensing nuclear plants avoids the addition of fossil fuel-fired power plants. Because it doesn’t, the EPA excludes nuclear plants undergoing relicensing from receiving economic credits for their carbon-free contributions to the U.S. energy system.

Unfortunately, most so-called environmentalists prefer wind and solar with fossil fuel back-up.

Robert Hargraves's picture
Robert Hargraves on Jan 5, 2017 9:57 pm GMT

No one understands the Clean Power Plan. This is deliberate. Complexity gives the opportunity for congressmen and senators to extract money from industries via K-street. “Extortion” author Peter Schweitzer terms such legislation a “double-milker” when it funds members of both parties.

The first draft regulation from EPA was simple; it prohibited building new power plants that emitted more than 454 grams of CO2 per kWh generated. It would have worked just fine. But it lacked the double-milker opportunity so was scrapped in favor of the CPP.

Darius Bentvels's picture
Darius Bentvels on Jan 6, 2017 1:01 pm GMT

Present nuclear power emit 3-10times more GHG’s than wind & solar.
So nuclear is not emission free.

Nuclear emission studies are:
– often from long ago when nuclear power was estimated to be x times cheaper (more expensive per KWh = more emissions in the end);
– neglect the important emissions in parts of the nuclear fuel cycle such as the guarded storage of the nuclear waste during thousands of years (repacking it, etc); the uranium mining; the uranium enrichment; the fuel rod production; etc.
– Furthermore they neglect the inserted new heat into the atmosphere (1GW NPP inserts 3GW new heat).

If those biases are corrected, the emissions of nuclear are near those of high efficient natural gas.

Engineer- Poet's picture
Engineer- Poet on Jan 6, 2017 1:49 pm GMT

First, it was 2-10 times.
Then it was 2-8 times.
Now it’s 3-10 times.

Get your lies straight, Bas.

Darius Bentvels's picture
Darius Bentvels on Jan 6, 2017 2:48 pm GMT

Losing 50% of nuclear capacity in 15years is financially beneficial for consumers and will deliver lower whole sale prices as experience in Germany shows. Hence is also beneficial for industry.

– With the continued price decreases of wind & solar (~6%-8%/a), average prices will be at 2-4cent/KWh in 2030. Which is substantial cheaper than nuclear can deliver.
The gaps due to intermittency can easily be filled with gas (cheap turbines as those will operate only 10%-20% of the time) while still meeting the CPP targets.

– It implies losing 10% base load capacity which is beneficial, as with the increase of much cheaper wind & solar, base load becomes a burden as German experience also shows.
It requires installing 10GW continuous capacity in 15years (=~45GW wind+solar).
That is 3GW wind+solar per year which is not much considering the 2-6times lower prices compared to those in 2011 when German wind+solar expanded 3 times faster with ~9GW/a.

Subsidies & tax credits
Nuclear enjoys already major subsidies which are much higher than the tax credits which wind & solar get. Such as:

– the nuclear accident and nuclear waste liability limitations granted by nuclear laws which represent a subsidy of 1-5 cent/KWh (1 cent for the new more safe NPP’s under construction, 5cent for the old, riskier NPP’s such as Pilgrim).

– Loan guarantees, investment levies rate payers have to pay so the utility gets free investment money (so utilities are eager to invest in expensive expansion), etc.

Removing all subsidies together with the tax credits will end all nuclear as nuclear is not competitive at all

Darius Bentvels's picture
Darius Bentvels on Jan 6, 2017 2:55 pm GMT

So we agree with the range roughly.
If it disturbs you that the estimation varies slightly, then take my original estimation, 2 – 10 times cheaper, as that covers reality anyway.

Bob Meinetz's picture
Bob Meinetz on Jan 6, 2017 3:44 pm GMT

Ken, the problem facing nuclear is a more fundamental one, and depends on the answer to a simple question: should electricity utilities holding a natural monopoly be allowed to consider only market forces when determining how that electricity is generated?

The answer appears to increasingly be “yes”, a repudiation of FDR’s Public Utilities Holding Company Act. When Congress passed PUHCA in 1935 they made utilities accountable for “public interest” – with no competition, utilities were no longer free to engage in business-as-usual. They would be required to provide service that was safe, reliable, and reasonably-priced to customers who had no choice of providers.

Since PUHCA was repealed in 2005 public interest has been waning in its influence, and it shows. Nationwide, electricity prices are up 30% over that time period – how does that happen, when cost of generation is lower than ever? It happens by turning regulated monopolies into unregulated ones. To maximize profits utilities adopt the cheapest method of generation, whether it’s bad for climate change or not. Whether it’s in the public interest, or not.

That issue is front and center in hearings on the future of Diablo Canyon Power Plant before the California Public Utility Commission. Pacific Gas & Electric Corporation has filed an application to abandon the functional $5.6 billion nuclear plant, one that provides 22% of California’s safe, clean, electricity – then send ratepayers the bill for the entire plant (yes, really). Like when Edison closed San Onofre in 2013, rates will go through the roof, and central California ratepayers will learn how good they had it – after it’s too late to get “it” back.

Kind of like voters, after Trump becomes president in two weeks. A simpler question might be “Which species has a longer attention span: American voters, or goldfish?”.

Engineer- Poet's picture
Engineer- Poet on Jan 6, 2017 3:55 pm GMT

You lie when you say there is agreement†.  Nuclear lifecycle CO2 emissions are equivalent to wind and far lower than solar.  Further, the system-wide emissions of nuclear are orders of magnitude less than wind because:
1.  Nuclear does not require 100% backup to cope with periods of unavailability of its energy source, and
2.  Nuclear does not require fossil fuel to fire that backup capacity.

† This doesn’t surprise anyone any more.  Every word you say is a lie, including “and” and “the”.

Bob Meinetz's picture
Bob Meinetz on Jan 6, 2017 4:02 pm GMT

Exactly, Robert. The long bills, riddled with specific perks for special interests, are the dangerous ones. They’re deliberately designed to exclude the possibility of reasoned judicial interpretation more generic legislation might permit.

Bob Meinetz's picture
Bob Meinetz on Jan 6, 2017 4:15 pm GMT

Bas, your “reality” is the same sepsis you have spewed during multiple episodes in the past. You’ve been banned twice, yet continue to re-appear in pseudonym.

I am contacting mods to respectfully request you are banned again. And again, until you contribute something above ideological trash to the dialogue here.

I would urge other TEC commenters do the same.

Darius Bentvels's picture
Darius Bentvels on Jan 6, 2017 5:30 pm GMT

So you refer to the World Nuclear Association who could find only old studies (most recent a decade ago; 2007) and some declarations by pro-nuclear Vattenfall etc. which are from 2010 or older.

Not strange since the situation changed fundamentally since that time:
– Nuclear became ~2 times more expensive. Also due to increased safety demands after Fukushima (hence also 2 times more CO2 emissions);
– solar and wind became 2 – 10 times cheaper due to efficiency improvements, so less CO2 emissions accordingly.

So now solar and wind emit 2-10times less CO2 per KWh produced.

backup
As NPP’s can and do stop totally unexpected within a few seconds, they require expensive spinning reserve, which implies even more emissions.

While cheaper wind & solar never stop suddenly because it are thousands of small generators dispersed over a large area. So they don’t need such spinning reserve.

But they do need flexible power plants which can adapt their production gradually to the changing needs of consumers and the production of wind & solar whose changes are accurately predicted as those occur according to the weather predictions.
Those power plants can burn the syn-gas produced in periods of overproduction (very cheap electricity) when the wind blows & the sun shines.

So this allows for a gradual zero emission situation, which is fundamentally more difficult and expensive with base load nuclear in the grid. As then the swings to be compensated by wind+solar+storage are much greater.

Nathan Wilson's picture
Nathan Wilson on Jan 7, 2017 4:51 am GMT

they [nukes] require expensive spinning reserve

Except that each reactor runs/fails independently, so you only need spinning reserves for one reactor, not the whole fleet (it’s not like a passing weather system can de-power a whole city’s worth of generation, as with solar & wind). Also, spinning reserves are not expensive, long distance transmission has traditionally been use to allow sharing of reserves; and in fact spinning reserves is the only application on most grids where batteries are cost effective (because 30 minutes of storage is plenty). Basically all integration techniques which are suggested for renewables work better, and have been used historically for conventional generation.

But they [solar & wind] do need flexible power plants which can adapt their production

Yes, but nukes can replace any fraction of the solar&wind. When this is done, it does not break the system, as you imply; actually it reduces the need for flexible generation and storage (thus allowing lower emissions than would be practical without the nukes).

In other words, it is simply untrue that nuclear does not mix well with renewables. In fact, adding nuclear to a renewable-rich grid is much better than adding more renewables (unless you goal is to sell more fossil fuel or pollute the environment).

Darius Bentvels's picture
Darius Bentvels on Jan 7, 2017 12:19 pm GMT

Assume a future grid in which base load nuclear delivers 30%, wind 50%, fossil 20%.
According to the Danish authorities where wind delivers now 40%, wind will then deliver >100% during ~100days a year. That implies an whole price at the marginal cost level of wind which is ~$5/MWh (wind will switch off below that level)*).

As nuclear production cannot decrease substantially (only against high costs), it has to deliver for that price while the marginal costs of nuclear is 4-9 times higher.
That inflexibility implies that there is already overproduction when wind increases 40%.. Which imply that whole sale price will be at ~$5/MWh during ~50% of the time.

Hence nuclear needs >100% higher rates during the rest of the year, which is impossible as then increased production & storage retrieval from the other generators will intervene.
So it’s the end for base load generators.

… nukes can replace any fraction of the solar&wind.

Though that’s true as long it’s below the minimum consumption level in the grid, the costs will be n-times higher. Especially in the future as wind+solar+storage continue their cost decrease path of 3%-10%/a according to the experts.
____
*) We assume no subsidies except the major liability limitation subsidies for nuclear.

Nathan Wilson's picture
Nathan Wilson on Jan 7, 2017 9:28 pm GMT

Assume a future grid in which base load nuclear delivers 30%, wind 50%, fossil 20%.
According to the Danish authorities where wind delivers now 40%, wind will then deliver >100% during ~100days a year….

Great example. In places like the US, China, and India, with cheap fossil fuel, no significant carbon tax, and limited tolerance for expensive power, we would not continue to expand windpower with curtailment that high.

The problem with adding more windpower in that situation is that it would be highly correlated with the existing windpower, so the resulting high curtailment rate ruins the economics for the new and old windfarms alike. It’s much better then to grow solar instead (which is what we see happening today). But since solar doesn’t work at night, an optimal mix of wind and solar will put solar at under half the contribution of wind; this still leaves fossil fuels with 40% or so of the generation.

So as we imagine adding nuclear in to such a grid, instead of using it to replace the fossil fuel, use it to replace the wind+solar+ff in proportion, or more realistically, we can select any linear combination of these two mixes:
– portfolio 1: wind 40%, solar 20%, hydro 5%, fossil 35%.
– portfolio 2: nuclear 75%, solar 10%, hydro 5%, fossil 10%*.

Both of these will have about the same total curtailment of clean energy, and I suspect about the same cost (assumes a continental grid; small grids will suffer high wind curtailment). But of course the nuclear-rich portfolio is 3.5x cleaner (obviously, the wind-rich portfolio can be made asymptotically cleaner as storage goes to infinity, but that won’t happen in reality; plus the nuclear grid becomes cleaner with storage too, preserving the relative advantage).

One can imagine market rules which discourage nuclear (e.g. by curtailing nuclear output more than wind and solar), but one could also image rules that would discourage wind and solar (e.g. by penalizing them for failure to meet their output forecast); all such rules favor fossil fuels. What we need are mechanisms to discourage emissions of CO2 and pollutants.

Some renewables enthusiasts will suggest that biomass can replace the fossil fuel in portfolio 1. Since biomass power plants are capital intensive (like coal plants), they’ll have poor economics in the low capacity factor application of portfolio 1; they will lose to fossil gas where available. But more important, biomass burning is bad for air pollution, and it’s use greatly increase humanity’s footprint on the environment; it’s a terrible solution and modern humans must move beyond it.

* This is a variation of France’s nuclear-rich grid. I have replaced half the hydro with solar, given the US resource mix.

Mark Heslep's picture
Mark Heslep on Jan 8, 2017 1:24 am GMT

Assume a future grid….the Danish authorities …wind delivers now 40%

Denmark is a nation, not a grid. The grid in which Denmark participates is nowhere close to 40% wind.

Darius Bentvels's picture
Darius Bentvels on Jan 8, 2017 3:47 am GMT

You are right that solar will also be added, but it won’t change much (I assumed wind only to keep it simple).

Furthermore at overproduction power to gas will start to operate, keeping the prices at ~$1/MWh so far less curtailment. While the syn-gas allows for cleaner production,

Your portfolio2 will be substantially more expensive already as also shown by the move of France to decrease nuclear towards 50% in 10years. Because nuclear is now already substantially more expensive than nuclear.

Due to the continued price decreases, we are moving towards a situation in which wind & solar delivering for $1/MWh or curtailed during 70% of the time, still deliver cheaper power overall than nuclear not curtailed.

Just check the studies of French govt institute ADEME which show that 80% renewable deliver the cheapest electricity mix for France in 2050!

Darius Bentvels's picture
Darius Bentvels on Jan 8, 2017 3:57 am GMT

Mark,
Denmark is actually two grids with few interconnections.
Of course Denmark has interconnections with its neighbors but that doesn’t imply one or two grids.
Suggest to study the situation in & around Denmark.

The rather large German state Schleswig-Holstein and neighbor produce more renewable electricity than their total consumption.
But their grid is part of the German grid.

Jarmo Mikkonen's picture
Jarmo Mikkonen on Jan 8, 2017 6:03 am GMT

Mark, here is the webpage of Fingrid which shows the power linkages between Nordpool countries, including Denmark. In Finnish, but if you click between Table and Map you can see realtime flows:

http://www.fingrid.fi/fi/sahkomarkkinat/voimajarjestelman-tila/Sivut/Poh...

Btw, at the time of writing this, Danish windpower is generating a grand total of 117 MW.

Darius Bentvels's picture
Darius Bentvels on Jan 8, 2017 5:06 pm GMT

Jarmo, thanks for the interesting map & data.
Though we should keep in mind that it’s only a snapshot of this moment, it shows:

– that Norwegian hydro produce with 21GW, ~16% more than total Norwegian consumption (18GW). Which explains that they are willing to increase interconnection capacities.
– an 11% price difference (31.84 vs 35.27) between the two Danish grids, which is more than I expected.

Nathan Wilson's picture
Nathan Wilson on Jan 8, 2017 7:04 pm GMT

To be more precise, the fleet “average cost” of the nuclear-rich portfolio will be the same or less than that of the wind-rich version.

We are often told that windpower has a very low “levelized cost” (for the US, this is mainly only true in the sparsely populated central plains). But there are several factors that make the fleet average cost much higher relative to nuclear:
– windturbines have a service life which is 3x shorter than a nuclear reactor.
– windfarms need much more transmission investment compared to nuclear (which can be sited closer to demand).
– wind-rich portfolios need much more backup power plants.
– backup power plants (as well as the fuel delivery and storage infrastructure which serves them) which work alongside windpower will run at low (less economical) capacity factors.
– wind-rich portfolios will always tend to use more fossil fuel than nuclear-rich ones, thus they suffer high external cost from the fossil fuel use.
– similarly, solar-rich portfolios will tend to need energy storage, which is very expensive and contributes negative net energy production.

One of the biggest problems with the wind-rich portfolios is that the cost rises rapidly with wind-penetration. After the “low hanging wind-fruit” (i.e. the first 30% penetration), there is strong economic incentives to simply stay with fossil fuels.

And no, the fact that the French government has an agency which, like the US NREL, actively promotes use of renewable energy, is not the least bit persuasive. It fits perfectly with the political climate of anti-nuclearism. Our governments are both spending billions on nuclear fusion as well, which is a natural follow-on to nuclear fission, but would be completely worthless if renewables were as cheap and easy as you imagine.

Jarmo Mikkonen's picture
Jarmo Mikkonen on Jan 8, 2017 8:31 pm GMT

Nathan,

I think Craig Morris says much the same you do, although his conclusions are different. Emphasis in the quote is mine:

You may wish – for the sake of the climate – that Germany would close its coal plants first, but they at least are more flexible than nuclear, as I recently illustrated here. As a result, Germany may not reduce its carbon emissions as much as we would all like in the midterm, but inflexibility has to go first unfortunately when the long-term focus is on solar and wind. The early retirement of baseload power plants precedes the need for power storage. At “only” a 20 percent share of solar and wind power in 2015, Germany clearly already needs to retire baseload.

https://energytransition.org/2016/05/germany-nearly-reached-100-percent-...

France achieved 80% nuclear generation 20 years ago with low costs. Will Germany achieve 80% renewable generation by 2050 with 1 trillion euros? Time will tell.

Darius Bentvels's picture
Darius Bentvels on Jan 9, 2017 12:08 am GMT

Service life wind longer than nuclear
Wind turbines are very simple machines; a shaft with 3 blades and a generator on it. Hence there low marginal costs.
NPP’s are complicated; need many specialists, advanced machinery, high pressures at high temperatures, etc.

Even expensive offshore wind turbines will reach easily >30yrs as showed by:
– the fact that all 11 wind turbines of the first offshore wind farm erected in 1991 still operate.*)
– the low cost of electricity (less than $50/MWh) their owners now ask, despite their high investment to make it running.

While new nuclear require now >$100/MWh (as shown by the new NPP’s at Hinkley, etc). Not strange as actual av. service life of NPP’s is ~40years.

Backup power
While NPP’s need expensive full capacity spinning reserve, wind+solar can do with cheap peakers which operate ~20% of the time.

Transmission
The costs difference is small. Transmission for nuclear need to support the sudden switch to other GW capacities which are usually not near.

Great cost rise with wind & solar penetration
That idea is not supported by the simulation studies of French ADEME neither by those of German think-tank Agora.
Neither fit with the expansion plans of Germany, Denmark, etc.

Anyway, the costs difference between nuclear and wind & solar is becoming so big that even an increase with a factor 2 keeps wind & solar cheaper.

Fusion
The idea is that fusion may bring us a next leap in cheap energy in the future (prices of <$1/MWh, etc.)
Fusion isn't a natural follow-on of fission, but a total different process, not creating actinides etc.

______
*) Though they may be replaced for economic reasons as one 8MW wind turbine produces nowadays two times more than the 11 wind turbines of 450KW while also requiring less maintenance.
.

Nathan Wilson's picture
Nathan Wilson on Jan 9, 2017 12:33 am GMT

The Craig Morris article comes to a different conclusion than I did because he asks a different question. This statement from the concluding paragraph is telling:
As a result, Germany may not reduce its carbon emissions as much as we would all like in the midterm, but inflexibility has to go first unfortunately when the long-term focus is on solar and wind.”

All well informed environmentalists should agree that the top priority should be to reduce emissions from fossil fuel burning; any other preference flies in the face of the pleadings of climate and environmental scientists.

Complementing variable renewables with flexible generation will reduce the amount of curtailment* they suffer and reduce the amount of storage required; it does nothing to reduce CO2 emissions or improve air quality. Replacing solar, wind, and flexible generation with nuclear reduces curtailment and reduces emissions. The high priority placed on shifting the grid towards flexible generation is an indication that renewables advocates are not willing to ask the public to pay extra to support the curtailment and storage expenses which are inevitable in a grid with high penetration, or they don’t believe the public will accept them.

Modern wind and solar installations have full electronic output control, they can curtail their output instantly. Similarly, batteries can increase or decrease their output instantly, and pumped hydro is also fast. Nukes can load follow plenty fast enough to follow user demand, so attempts to make them follow variable renewables really serves only the renewables advocates, not society in general.

* Note that I combine curtailment and sales of electricity to power-to-fuel plants at near-zero cost into the same category, since it has the same adverse effect on economics.

Darius Bentvels's picture
Darius Bentvels on Jan 9, 2017 7:49 am GMT

For Germany all nuclear out asap is top priority as a nuclear accident can easily cripple the whole country. Just map the exclusion zone of Chernobyl on NPP’s in Germany; or that of Fukushima after correction that >95% of its emitted radiation was blown directly to the sea (won’t occur in Germany).
With still 8 reactors the statistical chance for that is ~0.2%/decade, which is unacceptable for a method which produces only 15% of its electricity.

It feels strange when US people criticize the carbon emissions of Germany as::
– US emissions are still at the 1990 Kyoto level while Germany reduced 25%. More than any other major country!

– US emissions per capita are >30% higher.

– US has no firm action to reduce. The Obama CPP is hanging in its legal system and may be reduced to decoration by the new govt.
While Germany increases its efforts to reach its self imposed target of 40% reduction in 2020.

Jarmo Mikkonen's picture
Jarmo Mikkonen on Jan 9, 2017 12:22 pm GMT

It feels strange when US people criticize the carbon emissions of Germany as::
– US emissions are still at the 1990 Kyoto level while Germany reduced 25%. More than any other major country!

Everybody knows that 1990 was picked as a starting point because it camouflaged BAU emission reductions in Europe as policy-driven. In the case of Germany, 1990 gave Germany the huge emissions of former DDR inefficient industry which was quickly shut down, resulting impressive reductions – which would have happened anyway.

US population in 1990 was 248 million, in 2016 it is 325 million. The US population has grown over 30% while the population of Germany has remained about the same as in 1990.

Darius Bentvels's picture
Darius Bentvels on Jan 9, 2017 1:16 pm GMT

Jarmo,
The 78% higher US emissions are per capita, so population grow in US hardly plays a role (2013 data from the WorldBank). The per capita 2013 US emissions even increased 2.5% since 1990!

While the US consumed KWh is only slightly more polluting than the German KWh (US ~550kg CO2/MWh vs 536kg CO2/MWh in Germany), the ~2 times bigger electricity consumption per capita in USA is an important factor.

Note that the US backlog regarding pollution per KWh will gradually increase compared to the German KWh, due to the lower increase of renewable in USA.

Jarmo Mikkonen's picture
Jarmo Mikkonen on Jan 9, 2017 5:11 pm GMT

The US greenhouse gas emissions since 1990 have hardly grown despite 30% increase in population. Germany’s emissions wouldn’t have decreased if their population had also grown 30%. Therefore I see no reason to celebrate Germany’s achievement vs. the US.

The fact German electricity generation today is about as pollutive as the US generation per kWh – thank you for pointing that out – speaks volumes of the failure of German Energiewende and its emphasis on renewables to cut greenhouse gas emissions.

Mark Heslep's picture
Mark Heslep on Jan 9, 2017 7:12 pm GMT

The per capita 2013 US emissions even increased 2.5% since 1990!

No. US per capita CO2 emssions have returned to early 1960 levels, continue to fall, and are 16% below 1990 levels.

http://data.worldbank.org/indicator/EN.ATM.CO2E.PC?locations=US

Germany’s collective emissions remain fixed at the levels of five years ago.

Darius Bentvels's picture
Darius Bentvels on Jan 9, 2017 8:07 pm GMT

Mark,
Sorry! I got only the numbers 16.0 and 16.4 and misread the year for the first number ”1960″, as 1990. Probable because I’m rather fixed on that Kyoto reference year.

Emissions for German electricity per KWh in past decades decreased gradually:
year : CO2 in Kg/MWh
1990: 761
1995: 712 ( – 6%)
2000: 640 ( -10%)
2005: 608 ( – 5%)
2010: 557 ( – 8%)
2015: 535 ( – 4%)

Mark Heslep's picture
Mark Heslep on Jan 9, 2017 11:13 pm GMT

Emissions for German electricity ..

Bas – Could you share your source for those CO2 kg/MWh figures?

I find the following breakdown from UBA, on collective CO2 (equivalent) emissions by source. As others have noted, German emissions fell after reunification, though since 1995 most of the drop has been not in the energy industry but in the like of household usage and general industry, taking advantage of some of the low hanging fruit in improved efficiency. Those efficiency plays can’t be easily be run again. Interestingly, energy industry emissions have chanced little. In 1999 energy emissions were 344 million tons, and in 2015 were 345 million tons. There is no longer any possibility of reaching Germany’s 2020 CO2 target of a 40% cut from 1990. If the anti-nuclear push for renewables continues there, the 2030 target of a 55% cut will also soon become out of reach.

Darius Bentvels's picture
Darius Bentvels on Jan 10, 2017 8:45 am GMT

Mark,
I used the “CO2-Emissionsfaktor Strommix” column*) in the table from this UmweltBundesAmt (UBA) page.

You see yearly fluctuations due to economy, weather, ..
We can assume that the closure of 8 NPP’s in spring 2011 also played a role in the last upswing (2011-13).

But the trend is downwards which is logical with renewable increases that are higher than nuclear closures. Though those increases were small in the nineties (1990: 3.6%, 2000: 6.5%). But then more efficient power plants and increased nuclear production (1990: 27.7%, 2000: 29.3%) helped.
The new more efficient lignite power plants helped also with the reduction in recent years.

One can also see that there is no special effect due to the German reunification in 1990 visible.
Neither is Jarmo’s statement (in its comment above):

Everybody knows that 1990 was picked as a starting point because it camouflaged BAU emission reductions in Europe as policy-driven.

supported by the facts.
__________
*) = CO2 emission factor of the electricity mix.

Mark Heslep's picture
Mark Heslep on Jan 10, 2017 1:52 pm GMT

trend is downwards

No longer, not for the last 6 years with collective electricity generation.

Get Published - Build a Following

The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                 Learn more about posting on Energy Central »