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Writing Off Germany's Energiewende as a Failure Is Unwise

German renewables transition

“I think we need to start over,” Germany’s new Minister of Economics and Energy, Sigmar Gabriel, told a popular German weekly newspaper at the close of 2013 (dw.de). Gabriel was referring to Germany’s Energiewende, which translates to “energy revolution,” the country’s push to transform its economy from one reliant on fossil and nuclear generation to one powered chiefly by renewable energy sources.

Gabriel’s about-face shocked those committed to seeing the Energiewende through, but it resonated with those who have anxiously watched Germany’s electricity prices climb amidst widespread operational problems on the nation’s grid. At a recent energy conference in Berlin, Gabriel advised his listeners, “We need to keep in mind that the whole economic future of our country is riding on this…The energy transformation has the potential to be an economic success, but it can also cause a dramatic de-industrialization of our country” (New York Times).

With hopes to reign in runaway electricity prices, Gabriel is grappling with how best to reform the Energiewende’s lifeblood – the EEG, or Renewable Energy Sources Act, passed by the Bundestag in 2000.

Nearly fourteen years ago, the EEG gave electricity from wind, solar and other renewables priority access to the grid over conventional fuels by creating a feed-in tariff. As intended, it yielded the aggressive deployment of renewable energy capacity across Germany’s residential, commercial and industrial sectors. Thanks to this act, the country today boasts more than 63 gigawatts of solar and wind power capacity. It has also become home to some of Europe’s highest electricity prices. 

Germany’s residential consumers shoulder the costs of the EEG, in the form of a surcharge, and over the years their electricity bills have increased steadily to levels three times the U.S. national average. Such surge in prices has pushed some into “energy poverty,” where leaving the lights is no less than a luxury. Stoking further controversy, the EEG exempts some of Germany’s energy-intensive commercial and industrial consumers to avoid hindering their ability to compete in the global economy.

The values underpinning the Energiewende were and remain environmental, social and economic; they are rooted in a desire to address global climate change, foster public ownership of renewable generation assets and stimulate job growth within a clean energy economy. Through this movement, Germany aims to supply 80 percent of the country’s electricity demand with renewables by 2050 while dramatically cutting carbon emissions.

Boldness rarely goes without criticism. The nation’s energy shift receives denigration and praise both domestically and abroad. Those who consider climate change a top priority praise Germany for their leadership in taking action to address it. Those who downplay the implications of climate change, as well as those who value short-term economic prosperity over long-term environmental stewardship, condemn the effort as yet another example of failed government policy.

American energy expert and IHS Vice Chairman Daniel Yergin recently spoke with the Wall Street Journal about Germany’s energy dilemma. He believes the country should consider developing its domestic natural gas supplies through the proven, yet globally controversial, process of hydraulic fracturing, or fracking. IHS estimates Germany could meet 30 percent of its gas demand if it fracked.

In addition to burning cleaner than Germany’s robust reserves of brown coal, gas offers further value through its reliability and flexibility, making it a strong complement to renewables. Despite these benefits, Chancellor Angela Merkel and others hesitate to pursue fracking due to the broad environmental concerns it arouses.

Outside Germany’s borders, countless industry leaders and government officials deem its Energiewende a failure. Such an assertion, though considered reactionary by some, in reality harkens back to the success of the traditional utility business model. Utilities take issue with Germany’s high electricity prices and misalignment between electric generation and demand resulting from a liberal deployment of intermittent renewables. These critiques are valid and should be acknowledged as the EEG is reformed.

Nevertheless, writing off Germany’s Energiewende as a failure is unwise. In the grand scheme of electric system transitions, the Energiewende is in its infancy. Edison’s model was designed and built over more than a century to meet the affordability and reliability standards it offers today. The Energiewende needs time to mature in the hands of motivated, intelligent people with the technology of the 21st century at their disposal.

Let me offer just one example of how Germans have responded to the challenge of renewable intermittency. A recent article from designworld.com covered Germany’s largest utility, E.ON, demonstrating the conversion of surplus renewable power into hydrogen fuel via electrolysis. The hydrogen can be stored in pipelines or containers as physical energy for consumption at a later time. Such ingenuity may not have occurred on its own – it blossomed from the hurdles of 21st century modernization.

Germany’s boldness should be fairly criticized but absolutely recognized. Gabriel and other policymakers should welcome ideas and collaboration as they address tough issues and reform their approach. And finally, if nothing at all, we should all observe Germany in the coming decades, as it could show the world how to power a vital economy in a clean way.

Photo Credit: Energiewende a Failure?/shutterstock

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Recent Comments

Robert Bernal's picture
Robert Bernal on March 20, 2014

I don’t read all of your sentances either (anymore). But from the start, looks like you got your numbers mixed up LOL.

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

The share of renewable in German electricity production rises with ~1%-2% each year, until it is at least 80% in 2050. So logic dictates that the gradual demise of coal is inevitable.

And it does, if you check serious periods such as 1990-2013, or the period after the start of the Energiewende; 2001-2013.
Or just the past 7 years.

Despite the closure of 8 NPP’s in 2011, coal generated 11TWh (4%) less in 2013 compared to 2007.
And that was done with newer, less polluting, more efficient plants (~33% vs ~45%).
So the decrease of GHG emitted, was substantial more in the last 7 years (~15%).

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

Utilities closed more coal plants than they brought online. Even some of the new ones!

Many US/UK people share your distorted view, due to the selective publications of a.o. Bloomberg, Der Spiegel.

Some examples we see here in Netherlands:
– Vattenfall (one of the big 4 of Germany) built a new power plant at Rotterdam. When it was ready, they sold all removable parts to the Far East…
– Last year at Delfzijl harbor (north in NL), a new plant (from RWE?) finished and was mothballed.

Only new advanced, lignite plants situated in the lignite mine, have a real low cost price.

Here, in the competitive environment, utilities cannot raise the rate as in monopoly situations. If they do, consumer unions will rate them expensive… And customers move off (I can choose from ~20 utilities).

It are difficult times for the big incumbent utilities as they loose turnover & market share. The desperation of their CEO’s became visible in their outcry in Brussels last Okt, asking for a capacity market which would deliver them more income (superfluous until at least ~2025, probably also thereafter).
Just check the development of their stock market prices.

donough shanahan's picture
donough shanahan on March 20, 2014

So indeed it is preliminary data. I will note that the data does not agree with the levels for 2012 in terms of change with the IEA and EIA wghich is surprising as only one quater is included in thedata shown in that graph.

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

France now targets to reduce the share of nuclear towards 50%, replacing it with renewable.

So following Germany.

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

Just compare the German FiT’s for wind & solar with the expected UK nuclear strike prices in 2023 (start of the plant) and 2040 (halfway the 35year strike price period of 35years). With 2% inflation, the strike price for Hinkley will be £115/MWh in 2023 and £161/MWh in 2035.
Then add the partly not visible yet, high subsidies to Hinkley, such as the huge loan garantee, etc.

If you do correct, you understand why London city financial analysts called the investment: “insane”, etc

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

Sorry. It was not my intention to frustrate you.

Btw.
I read the whole of your story, and studied different reactor designs long ago.

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

…Hinkley Point reactor gets a lower strike price than wind and solar..
In the initial UK government document. Those would deliver real windfall profits for solar and wind owners.

But in the last UK government docs, the truth came. Only restricted budgets available for FiT’s of solar and wind. And it will be auctioned, so the lowest price will win.

That implies that UK strike prices for wind and solar will be at the German FiT’s level (as those are calculated with a profit of ~7% for the investor, and little cost price differences).

The Hinckley strike price in 2023 will be ~£115/MWh, in 2030 ~£161/MWh (2% inflation).
FiT’s for solar in 2023 £52/MWh for rooftop and £37/MWh for solar installations >1MW.
etc.

Bas Gresnigt's picture
Bas Gresnigt on March 20, 2014

Seems US has far less strict air pollution regulations regarding power plants than we have here in NL and Germany. Should be improved (India too).

Even New York Academy of Scientists found the IAEA/WHO lies around Chernobyl so striking that they published the review / book of prof. Yablokov on their WEB-site. Based on thousands of studies, that states: 1million death before 2007. And realize that most death still have to come as low level radiation has a latency of 20–60years before harm shows.
It is special as it is the only book they publish on their site (as far as I could see).

That shows that Chernobyl alone killed already far more.

It is not only killing, also damage to next generations: A week ago a documentary on Dutch TV showed that ~90% of all children in the Chernobyl region have chronic diseases, 26 years after the disaster.

wind smith's picture
wind smith on March 20, 2014

Foreign investment in 2013: 

France = minus 77%

Spain = plus 37%

Germany = plus = 400%

Minnesota GNP = $243 billion , 50 billion kwh used @ $0.10/kwh = $5 billion = 2.06% of GDP

Electricity costs are just not that important to an economy compared to education, public health, well managed,efficient, trasparent bussineses and goverment, low cost high quality health care, etc.

 

Jesper Antonsson's picture
Jesper Antonsson on March 20, 2014

Again, Germany doesn’t lead if you are worried about AGW. France does. By 60 years.

Paul O's picture
Paul O on March 20, 2014

Bas Nuclear plants “Heat The Earth”, and Coal Plants do not ?

Joris van Dorp's picture
Joris van Dorp on March 21, 2014

Even New York Academy of Scientists found the IAEA/WHO lies around Chernobyl so striking that they published the review / book of prof. Yablokov on their WEB-site. Based on thousands of studies, that states: 1million death before 2007.”

Bas Gresnigt, it is you who are the liar! You repeat your endless lies at will. You abuse the right of free speech. You are a threat to humanity and the planet.

People who are interested in the depth of your lies can study the fully referenced discussion of the ‘study’ by Yablokov here, including a devastating review of the ‘study’. You know this, it has been shown you many times, but you ignore it and continue your lies year in year out. Perhaps someday you will get what you deserve. There is no sleep for the wicked.

In December 2009, the editor of the Annals of the New York Academy of Sciences decided to provide printing services for a small group of people who had a history of pursuing an agenda against the use of nuclear energy. They had translated a book titled Chernobyl: Consequences of the Catastrophe for People and the Environment that had initially been sponsored by Greenpeace and written by a co-founder of Greenpeace Russia, Alexey V. Yablokov.

Using scientifically unsupportable techniques, Yablokov claimed that hundreds of millions of people had been exposed to radiation from the Chernobyl accident and close to a million had already died as a result of that exposure. Several months after the book was published, Ted Rockwell, a long time member of the NYAS began a letter writing effort to convince his organization that the work violated many of the principles on which the organization was founded. You can find a number of articles on Ted’s saga here on Atomic Insights.

A couple of days ago, Ted sent out an update that he wants shared widely. Ted is a tenacious man who is a staunch defender of the scientific method and the integrity of scientific organizations against efforts to co-opt their credibility with the public. He wants everyone to understand the reasons he is so offended by the continued availability of the unscientific work on the web site of the organization of which he is a proud member. I’ll let Ted do the rest of the talking:”

http://atomicinsights.com/challenging-nyas-decision-to-keep-yablokovs-chernobyl-fiction-online/

 

 

Bas Gresnigt's picture
Bas Gresnigt on March 21, 2014

If negative and high prices during longer periods & more often, storage becomes economic in Germany.

Now the price is near always low and only sometimes negative. 
So near all ~35 pumped storage facilities in Germany make losses, and installation of new pumped storage facilities stopped totally.

Taking into account the succesfull rooftop solar battery subsidy program, I’m not sure whether that will change.

Bas Gresnigt's picture
Bas Gresnigt on March 21, 2014

So many attempts to disqualify the book and get it off the site. Depite all that, NYAS apparently found the book so valuable that they kept it on their site.

May be it is worthwhile to read it, so you can judge yourself.

Bas Gresnigt's picture
Bas Gresnigt on March 21, 2014

“…There is no way to compete against nuclear…” 
So why is it that all new nuclear reactors need great government support?
Such as:
 – Laws that transfer the investment risk to rate payers (Vogtle, etc)
 – Accidents liability limitation laws that limit liability to <0.1% of the possible accident damage. Transferring the costs (invisible insurance premium) to the nearby citizen and tax-payer.
 – Loan guarantees worth ~$1billion/year (Hinkley)
 – Waste liability limitation laws (e.g. <100years and even then not all; compare Hinkley)
 – Insane high strike prices (with 2%/a inflation $170/MWh in 2023 when Hinkley starts, going up further with inflation during 35years), or granted rate increases (Vogtle).
etc.

Or do you mean that the pro-nuclear lobby will crush any opposition at Government? 

Robert Bernal's picture
Robert Bernal on March 21, 2014

No, don’t “just”. I ask for what it takes to power a world without nuclear and without coal! That means like 50,000,000 times what you get from the renewables times TEN or so for when its not working (nightime) times whatever to store all this for MONTHS at at time

Ok, I’m exaggerating now, but now you get my drift…. If we must quit nuclear then we MUST also quite coal and that means about 1 million sq km (at least) of solar covered land (with solar for much less than today plus NO land costs and almost free storage). Will you accept that!

Bas Gresnigt's picture
Bas Gresnigt on March 21, 2014

Rooftop solar deliver enough electricity if 50% of all roofs are covered.

Phil Hughes's picture
Phil Hughes on March 21, 2014

Original post was duplicated

Phil Hughes's picture
Phil Hughes on March 21, 2014

Original post was duplicated.

Phil Hughes's picture
Phil Hughes on March 21, 2014

Coal Plants with Carbon Capture come in far less than that implied by 3X rates in Germany versus US. The Cost Basis for Coal with CC is less than half of Natural Gas here, and that is when NG is $6 per MMF. And the Carbon Dioxide can be sold for purging mature fields in the Middle East and the residual sold for Algal Ethanol production at 160 gallons per ton. In short, Coal, not NG is still the answer, but with Capture and delivery of CO2 at $40 per ton. And even at that price, the raw materials for Algal Ethanol is still only $0.25 per gallon.

Robert Bernal's picture
Robert Bernal on March 21, 2014

We’ve got to stop burning coal because it kills. Using the excess CO2 as a feedstock for algae will not quite make it as efficient as NG, anyways. It’s time to develop the least expensive most abundant source and deal with the isolation of the very small amount of wastes (preferably fissioned in a molten fuels reactor which is meltdown proof, up to 100x less waste and which waste is almost all fission products which means 300 years and the radioactivity is GONE… That’s the closed cycle, by far, the most promising energy technology available!

Robert Bernal's picture
Robert Bernal on March 21, 2014

Hinkly is only a billion a year? Sounds like a good deal! Hmmm, not to (really) be against solar but, (Please pause as I look up the solar thermal plant in Arizona… Oh here it is…) 

Solana Generating Station
Robert Bernal's picture
Robert Bernal on March 22, 2014

I already proved that wrong. It only provides a tenth of the electricity. Efficiency improvements includes electric cars (which require yet more electricty). The US has about 105 million households. I assume not all of them have their own roof, and only about 40% of that would be suitable for solar (watch out for trees). Each sq meter of solar panel nets about 150 watts (max). Figure 40,000,000 x 10 sq meters = 60GW capacity times 1/4 of the hours in a year = 132 TWh. The United States consumes 3,800 TWh

Gary Tulie's picture
Gary Tulie on March 22, 2014

There is a difficulty on the horizon for solar power in Germany, and that is that in summer, if solar keeps growing, capacity could soon exceed demand on sunny summer days, whilst only making a very modest contribution on dull winter days. This being the case, even if solar becomes the lowest cost electricity solution per kWh generated, the average value of this power could also reduce as a significant proportion will be produced when it is not needed. 

The same is true for wind, however rather than seasonal variation, wind generally varies on the time frame of weather systems – usually a few days to a couple of weeks. Wind therefore is better matched to balancing by hydro and pumped hydro storage.

To reach 80% there is a need for one of the following.

1. Baseload renewables – biomass (Limited fuel availability) and geothermal power systems which require further development to become affordable at scale in Germany.

2. A European Supergrid extending to Iceland, North Africa and the Middle East – with substantial import and export of power from intermittant renewables. This latter could be enhanced by substantial German investment in solar and wind power abroad e.g. Greece, Iberian peninsular, and North Africa which may prove more cost effective than more solar and wind capacity in Germany.  

Phil Hughes's picture
Phil Hughes on March 22, 2014

The ratios which I used were good solid figures. Figures regarding Algal Ethanol yield come from Algenol.com. The figures on Carbon Capture come from the International Energy Agency. I agree that Nuclear is there, but the question is what we can do to retrofit the existing Coal Plants and ameliorate problems with new Coal Plants put in before the Nuclear such as you mentioned is developed.

The problem in general is that there is a major disconnect that no one wants to acknowledge, and that is the disconnect between conceptual “pumped profits” and profits from manufacturing. The expectations on the former are so high that algal ethanol from nations with low labor costs can actually come in and undercut produced oil. And Natural Gas as a transportation fuel which will be extremely dangerous is undercutting everyone, and with a false promise.

And a nation with extremely low labor costs is China and speaking of Coal Plants, they are adding a new Coal Plant every two weeks. With only 17,000 square miles of uncultivatable land (0.5% of their land area) and 2 million workers, China has the ability to produce one Saudi Arabia in output per year. Then after that it will cascade and drive oil services into the ground, essentially trapping othherwise recoverable reserves. Incidentally, the only reason that the high cost of manufacturing labor is not more of a problem is that in the US there is a lot of money from exploitation of resources and we also have a large annual deficit.

In short, something needs to be done about providing work and Capital Investment within the spheres of influence of the US and Europe (i.e., Mexico and Northern Africa) and when we have the entire cycle of Carbon Capture, CO2 Sweeping of mature fields, and Algal Fuel Production down under control, the proper relationship will exist in profits from manufacturing and exploitation of resources. All the emphasis behind Solar and Wind renewables is just a matter of “feeling good” compared with this. It does nothing but enable the disconnect in over all consumption and productivity we have in our spheres of influence as compared with China and Asia.

 

Phil Hughes

HughesSynergies.com 

 

Bob Meinetz's picture
Bob Meinetz on March 22, 2014

Phil, coal has more in common with fast food than you might think.

When I go to my favorite fast food drive-thru (or any one, for that matter) they always take my money first. Then they give me my food. It doesn’t take much consideration to figure out why – even if they were to extend this level of trust as a courtesy, a fair number of customers would bolt without paying. I haven’t seen any studies on this, but I assume it would take a significant chunk out of their profits.

Carbon offsets and CCS fail on a similar basis – the amount of carbon we use will never be “paid for” after the fact. This is due to inefficiencies, to cost, to fraud, but mostly to human nature. Who’s going to know? What’s a little more of my invisible gas in the atmosphere when “everyone else” is putting in their share? As long as I go through the motions, I receive a “Get Out of Jail Free” card, and you nor anyone else can perform the calculations which might justify denying it from me.

These post-use carbon games, while they serve as a convenient salve for our souls, have no such effect on climate and are pointless. The answer is to never pull it out of the ground in the first place.

Phil Hughes's picture
Phil Hughes on March 22, 2014

Bob, if we can use coal and remove 70% plus of the Carbon Dioxide and still be less than Natural Gas in cost, even new plants would be justified. And that Carbon Dioxide is the start of another fuel chain giving jobs to 2 million people for each Saudi Arabia equivalent rate of production we have. In fact, it is the only thing which will guarantee that the equivalent price of a barrel will never exceed $120 per barrel. In fact, if liquid fuels do go and start staying that high, Algal Fuels will come in a manner which we cannot anticipate or control.

The processes are all scaleable and therefore very low risk and the costs are therefore well-known. Even if I derate exceedingly a price of $60 per ton of Carbon Dioxide will result in feedstock prices of $0.40 per gallon on ethanol which will wholesale out at $2.70 per gallon.

Another consideration comes in the question when China is adding a Coal Plant every 2 weeks, what harm would it do to just pursue Carbon Capture, oil field scrubbing, and sale of the excess for Algal fuels? This is exactly because we know that it is scaleable and we know what the costs are going to be long term after the process is expanded and refined. It make no sense to spend the kind of money Germany has on Solar and wind when two pipelines can convey the equivalent of 80 gigawatts equivalent CO2 to Northern and Eastern Africa to generate $10,000 profit per acre on uncultivatable land.

I think that the corruption is actually with those who know that wind and solar are not going to work out and that even without selling the CO2, the cost of CC will still cause coal to come in cleaner and less expensive than natural gas.

Bob Meinetz's picture
Bob Meinetz on March 22, 2014

Phil, the best thing that could happen for the environment is that fossil prices would go through the roof.  I am in favor of any policy which leads to that end, be it a tax, tariff, or import limits. By any standard, resouce waste is rampant in America, and making waste expensive is the only proven way to reduce it.

It also leaves us with the question of what to use going forward. While efficiency can reduce our needs somewhat, eventually we’ll need more energy – a lot more. I agree with you about wind and solar, and the renewables/fossil industries have become strange bedfellows – they both assist with the other’s bottom line.

The harm in pursuing CCS is that we have limited resources and there’s no evidence we’ll be capable of permanently sequestering 22 billion tons of carbon every year.  Better to spend the money on 4th-generation nuclear technology, which could provide all the electricity we need as well as generate synfuels from atmospheric carbon.

Phil Hughes's picture
Phil Hughes on March 22, 2014

Bob, I want to curb CO2 emissions, but I fail to understand what a draconian effort to do so with unwise approaches will do for us when there are huge emitters like China out there. Makes no sense.

I take exception on the objective of having oil prices go through the roof. We have seen what it will do to the economy. So is the question that we in the US and Europe are to have our economies crippled when it will make absolutely no difference in Warming? Makes no sense except for feeling good. When I worked at Exxon and Valdez happened, I was all too liberal with my opinion that the CEO should go on site. That Shell’s CEO would and therefore Lawrence Rawls should.

You know what, I was wrong. It would have been a Feel Good event but would have done absolutely nothing to solve the problem. In short, I was an Idiot.

Same situation on Solar and Windpower … and recycling Cell Phone Batteries, et. al.

What we do must be Bulk Processes. We must add the Bulk Processes of Amine Scrubbers to Bulk Coal Plants. And, as I say again, since all proceses are scaleable we know what the long term results are going to be.

Phil Hughes

HughesSynergies.com

Robert Bernal's picture
Robert Bernal on March 22, 2014

We need to make a trade law against coal. We need to clean up our act. Solar, despite growing, has only made a, as you say “feeling good” dent in the overall capacity. Wind is only slightly higher.

Thus, it is nuclear that can clean up humanity’s death spiral towards fossil fueled depletion into an overheated biosphere (I prefer that to be of the molten fuels design).

Bob Meinetz's picture
Bob Meinetz on March 23, 2014

Phil, the “common sense” wisdom which says higher energy prices cripple the economy has no basis in science. Some evidence suggests the opposite is true:

https://rwer.wordpress.com/2010/08/27/the-relation-between-oil-prices-an...

The bottom line is this: we’re doing damage to the environment which will last for 100,000 years or more, so the economy of the next decade or five decades is irrelevant. Moreover, when the U.S. is #12 on the list of per capita carbon emissions and China is #55, you bet it’s our responsibility to take the lead on this critical issue. We have no right to blame China for past carbon emissions which have provided us with the highest standard of living in the world. Claiming we should be judged by a different standard is American exceptionalism at its worst – and no one in the international community is buying it.

A “feelgood” solution is adding amine scrubbers to coal plants, which might create even more carbon depending on what’s powering these energy-intensive processes.

Phil Hughes's picture
Phil Hughes on March 23, 2014

Bob, Regardless of the “per capita” distribution, the addition of those Coal Plants is there. The point that I am trying to make is that these CO2 emissions have taken a long time to escalate and we stand a chance of hurting the situation far more by draconian efforts attacking Coal Plants and still not taking the correct route. Makes no sense. It is not that we are doing damage to the economy that will last 100,000 years. The half life of Carbon Dioxide is not that high that it will last that long with abatement, but we have done damage by continued emissions that will last many years it is true. Taking extra time to make sure we have the correct solution even if it is added onto the end is not going to hurt anything.

By the way, with its coal plants and labor productivity, China is in an excellent position to start a cascade toward Algal Fuels which will cripple our Oil Services industry. 0.5% of their land and 2 million workers yields one Saudi Arabia of production. 1.0% of their land and 4 million, two Saudi Arabia’s. And with their ability to finance projects the potential that this will cascade is huge.

Also, it does no one any service to infer that another party supports American exceptionalism. I state clearly that we need to do something but not the wrong things. The animals are out of the barn. Let’s try to get them back in the barn, not burn it down.

Finally, I would never go along with any figures that did not quote percentage of Carbon Dioxide avoided and include that in the marginal increase on cost of Coal. Coal still comes in better than Natural Gas with Carbon Capture and use of Coal will not drive up the cost of Natural Gas to the point where people freeze. By the way, when the draconian irrational approach of closing or suppressing Coal Plants and buying Natural Gas at any cost fails and people are cold, what fuel do you think they are going to use to avoid freezing to death? They are going to use coal.

 

Phil Hughes

HughesSynergies.com

 

 

Gary Tulie's picture
Gary Tulie on March 23, 2014

Can the figures from Algenol be relied upon?

I recognise Algenol has reached the proof of principle stage, and that they may be achieving the yields they suggest – which are at least credible from a basic bio-physics of photosynthesis point of view (Unlike some claims made by others in the past). I would however point to some fairly hefty inputs in terms of hardware and energy required to grow and separate the algae and to turn it into fuel.

In theory, algae can offer a useful contribution however I think it will be some time before the technology is mature enough for large scale deployment on the millions of barrels a day scale. 

 

 

 

Gary Tulie's picture
Gary Tulie on March 23, 2014

The half life of CO2 is not the only consideration. Putting a huge pulse of CO2 into the atmosphere will have effects which will last many thousands of years longer than the CO2 pulse itself through various feedbacks and delayed effects.

Lag effects – raise CO2 levels and the Earth absorbs more heat than it releases. The full effect will take many years to show up. If CO2 levels stabilised today temperatures will continue to rise for possibly a century or more even without a further rise in CO2 levels. 

Rising temperatures threaten to set off a series of feedback effects – melting arctic ice allows more heat to be absorbed as water is darker than ice – boosting the rate of temperature rise, and in turn triggering net melting of the Greenland ice sheet. As ice melts, the ice surface lowers so being exposed to higher temperatures and melting faster. Likewise there are possible effects which might turn rainforest areas dryer changing the habitat from dense forest to scrub – with far less carbon storage capacity. Other effects relate to ocean current and atmospheric circulation changes which can have huge and somewhat unpredictable effects on climate.  

Overall therefore it looks to me entirely feasible that human activities now will very substantially affect habitats, ecology and sea levels over >100,000 years.

Phil Hughes's picture
Phil Hughes on March 23, 2014

They are Government funded and so subject to auditting. They quote $1.27 per gallon costs for a mix which is fundamentally ethanol but also gasoline and fuel oils.\

The yield of 8,000 gallons per acre per year is 20 times better than ethanol from corn which although it is subsidized still must be low in cost already since only 10% added drops gasoline prices by 5 cents per gallon. Admittedly the capital costs are there but certainly they are required to factor that into their quote at $1.27 per gallon. 

The process would be scaleable and Algenol says they are doing so. The refining processes can be shared after collection over many acres so I am not that concerned about that machinery. The concern that I would have is what investment is actually distributed on the ground and what its service life is.

Phil Hughes's picture
Phil Hughes on March 23, 2014

Even so, I think that we must go with Coal with scrubbers lest the price of Natural Gas go prohibitive. I think that Algal fuels will offset the costs of capture and transmission but even if we have to sequester for a while it is still better to use Coal. The eqivalent amount of Natural Gas we have to move to offset coal and liquid petroleum is enormous. Accidents, high cost spikes, and shortages due to inability to store and transmit NG will be extreme. And where is the limit once the money starts flowing toward NG prolifieration? It will be the dark ages.

By the way, I need corrobation on this so I am not committing to it, but have you seen the data that the sun is entering a lull in its output? If so, they are predicting Ice will come down into the lower latitudes based upon that factor.

Nathan Wilson's picture
Nathan Wilson on March 27, 2014

“… it is now already economic for home owners to install rooftop solar in Germany… They save 28cent/KWh electricity they have to buy from the utility now.”

Wow, do they have net-metering? (i.e. can they off-set their night-time consumption against extra daytime generation?)

German voters must be really bad at math.  How can they not understand that letting homeowners avoid a 28 cent payment for every kWh of solar power they produce to replace coal-generated electricity which has a marginal cost of only 3 cents per kWh is extremely uneconomical (i.e. the cost is shifted elsewhere in the economy, but it must be somewhere, other electricity users and taxpayers).

wind smith's picture
wind smith on March 27, 2014

Foreign investment in 2013: 

France = minus 77%

Spain = plus 37%

Germany = plus = 400%

Minnesota GNP = $243 billion , 50 billion kwh used @ $0.10/kwh = $5 billion = 2.06% of GNP

a third of the $.10/kwh is for local distribution which would be the same for any generation source so actual cost is $.07/kwh = 1.44% of GNP.

Electricity costs are just not that important to an economy compared to education, public health, well managed,efficient, transparent businesses and government, low cost high quality health care, etc.

Keith Pickering's picture
Keith Pickering on March 28, 2014

You’re forgetting option 3:

3. Baseload nuclear. Already affordable at scale, no supergrid required.

Robert Bernal's picture
Robert Bernal on March 28, 2014

Electricity prices ARE important because “everything else” is secondary. I’m sure there is a term for that in economics. The “foundation” to any economy (energy) may be required in various different proportions to total economic output due to society’s demands (and wants) and technology. It is assumed that as a civilization progresses, less and less of its total economic output is from energy. Some of these may only require trivial amounts of energy such as a years worth of (still expensive) LED lights. However, some will require huge amounts of energy (such as a years worth of hot water, gasoline, heating and air conditioning, etc).

Consider also that outside of the home, where about two thirds of all our per person carbon footprints actually come from: Food production, water, industrial processes, etc do NOT have much to offer in the way of efficiency improvements. Thus, the costs for the “foundation” to all that must not increase substantially. Even so, some extreme environmentalists say that we really can reduce our “consumption” of these vital (and energy consuming) infratructure needs to make up for the high cost of replacing hydrocarbons with the vast overbuild of renewables needed to be put in (again vast) storage. This is simply NOT true (and not happening!).

“Everybody” will need close to the same amount of energy to power their share of food, water, mobility, metal goods, entertainment, these computing devices, etc.  No matter how efficient, civilization WILL use more electricity… VASTLY more (because there will become billions of new developed citizens requiring juice to power their electric cars, and even a few more billion people, the energy requirements to “erase” excess CO2, etc).

Best to make its that energy source’s waste isolatable from the environment, make it for less and make it 24/7.

Bas Gresnigt's picture
Bas Gresnigt on March 29, 2014

…energy source’s waste isolatable from the environment, make it for less…
So that excludes nuclear, as that is one of the most expensive. Especially if all subsidies (liability limitations, etc) are accounted for.
Far more expensive than: Solar+storage+wind

Solar+storage+wind even do not produce waste.
So no problem to keep it isolated for a millon years.

Bas Gresnigt's picture
Bas Gresnigt on March 29, 2014

Nathan,You forget: 
 – that most of electricity price here are taxes (which the government needs anyway):
 – the other cost components such a the grid.
Here in NL no Energiewende, still electricity 22cent/KWh.

German voters made the calculation that the insurance premium to cover the costs of a nuclear disaster and safe storage of nuclear waste (which they subsidize now) is bigger than the extra costs of the Energiewende, which is 6cent/Kwh now and projected to rise slightly until ~2023 and then go downwards.

Nathan Wilson's picture
Nathan Wilson on March 29, 2014

Right, my point was really that the owners of solar systems weren’t paying any taxes on the power they self-generate.  That’s great for early adopters, but it is not scalable, since goverments can’t function if no one pays taxes.

Taxes are just part of the reason that retail electricity prices are higher than wholesale prices, there are other fixed grid costs.  This is really the heart of the battle in the US over net-metering: how long should we ignore those other costs in order to stimulate the home solar market?

Nathan Wilson's picture
Nathan Wilson on March 29, 2014

If Germany’s energy experiment requires a European Supergrid, then that makes it a failure, since the stakes are far too high to gamble the entire continent.  We know the nuclear option works; if Germany chooses not to use it, fine, but don’t drag the whole world down too.

There is another solution that they have been ignoring, and that is ammonia synthesis.  They can make ammonia from excess renewable energy and store it for months if needed; it can be used for transportation  fuel, combined-heat-and-power, or burned to make electricity.  They have experimented with power-to-gas (i.e. using electricity to make methane), but this costs more than ammonia and the need for CO2 makes it unsustainable (i.e. it’s another make believe solution).  

Of course using fuel synthesis for energy storage has poor efficiency, and therefore costs more than just continuing to use coal.  The fact that they have continued investing coal, but have not invested in ammonia suggests that Germany is not actually on a path to phase out fossil fuel use.

Nathan Wilson's picture
Nathan Wilson on March 29, 2014

According to the US government EIA, coal with CC&S is not attractive economically.  They put its cost at $0.136/kWh, compared to only $0.093/kWh for natural gas with CC&S, and $0.108/kWh for nuclear.

At those prices, CC&S programs are just welfare for the coal industry.

Phil Hughes's picture
Phil Hughes on March 30, 2014

What is the cost of Natural Gas per MMF used for the 10 cent per KWH figure? I suspect it is less than $6 per mmf.

The controlling factor with CNG/LNG in the mix is the price of gasoline and diesel. With this situation Natural Gas can and will rise to $12+ per mmf and even then our friends overseas, especially the Saudis, cannot get the price they need from mature fields, or actually any field because that is the last they will have. We are betraying our friends by paying for liquids with Trinkets.

Now when natural gas goes to $12 per mmf, electric power from Natural Gas will be at least 20 cents per KWH.

Phil Hughes's picture
Phil Hughes on March 31, 2014

We have been advancing a new model for high speed rail at a compromise 150 mph. The movement of semi-trucks 5 at a time generates $12.50 per mile and at 10,000 miles and only 30% load factor it will gross over $50 billion per year and net over $25 billion per year.At 60% load factor and more passenger carriers in the mix the revenue will be enormous and we can actually retire the development costs whch is unheard of for HSR systems.

Then that enabled the placement of an American Carbon Dioxide Manifold (ACDM) along side of that and then that suggested a European Carbon Dioxide manifold (ECDM) which knowing about a future ACDM would have been good to have working now.

Now, finally, the 4 42 inch carbon steel pipes comprising the ECDM and ACDM will serve as a 800 KVDC UHVDC power backbone with losses less than 1% per 1,000 miles, or 1,600 kilometers. There will be a line from Berlin area through Vienna, then though the Balkans, then Turkey, then Jordan, down the West Coast of Saudi Arabia and then to Ethiopia and Kenya. Then on the West we will go from Holland through France, Spain, Morrocco, and Nigeria. What is not used for flushing the last 25% out of mature or intermediate age fields will supply feedstock for Algal Ethanol at only 40 cents per gallon cost of raw feedstock.

Look at HughesSynergies.com under the PowerPack Section.

Phil Hughes

Phil Hughes's picture
Phil Hughes on March 30, 2014

Nathan, I respect your knowledge. it is very good.

But NG prices are not stable. This is what T. Boone Pickens and Associates are counting on. And if they were stable at $6 per mmf the Saudi’s will be in trouble and we have no right to use that against them to force them to pump at low prices. Literally, it is greed like that that will cause World War III. The only clean and Kosher use of Natural Gas is Gas to Liquids conversion and that only adds $1.50 at most to the cost of a wholesale gallon. That is also the spread we need to keep home heating and industrial prices where they should be.

I have to dispassionately cut to the chase because it is objectively true without Passion, Natural Gas Interests are pure Greed.

Phil Hughes

HughesSynergies.com

Bas Gresnigt's picture
Bas Gresnigt on March 30, 2014

@Nathan,”...solution that they have been ignoring, and that is ammonia synthesis…
Dubious whether it is viable for now. It requires a change in infra-structure, far more than only a production plant.
They have pilot plants for the synthesis of car fuel and ‘natural’ gas.

Studies show that all these are not needed before 2025, when the share of renewable approach 50%.
The fact that their 35 pumped storage facilities are making losses, indicate also that with a renewable share of ~24% (present figure) no substantial need for storage.
They stopped building new pumped storage facilities..

Note that the official German target is 80% renewable for electricity in 2050. Though there are strong forces to upgrade (they are far behind Denmark). If they use the 20% fossil for the periods of no wind + no solar, they may reach that target without substantial storage or conversion to fuel.

…they have continued investing coal…
Coal went down during the 1990-2013, and 2001-2013, and even the 2007-2013 period. Despite closing the majority of their nuclear plants in the 2003-2013 period, and even 8 in 2011 alone.

They replaced only a part of the old coal capacity by new coal capacity as these new coal power plants are more flexible (fast up and deep down) and have substantial higher efficiency. So those new plants compete the old plants out of the market.

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