10 ms·

Cheapest Solar on Record Offered as Abu Dhabi Expands Renewables

86 points by Osiris30 10y ago

tekni5 10y ago
Under 2.5 cents per a kWh is very cheap, but I'm guessing there are other costs like storage on top? Anyways will be interesting to see for the future if solar actually becomes a more dominant source of energy worldwide.
- deleted 10y ago
  [deleted]
- dx034 10y ago
  I guess most energy in UAE is used for cooling which should be highly correlated to solar output. They could probably meet most of their energy demand with solar power without significant amount of storage. Furthermore, desalination will probably also play a major role in electricity consumption and I can imagine that plants can be adjusted to solar power production instead of running them at the same level 24/7 (pure speculation, no idea how the technology behind this works). Edit: All water in UAE comes from desalination[0], so using clean water storage with larger plants instead of energy storage could be cheaper. [0] https://en.wikipedia.org/wiki/Water_supply_and_sanitation_in_Abu_Dhabi https://en.wikipedia.org/wiki/Water_supply_and_sanitation_in...
  - lucaspiller 10y ago
    > They could probably meet most of their energy demand with solar power without significant amount of storage. Not really, I was living in Dubai last year, and during the summer it was around 48C/120F in the day but it's still 35C/95F+ at night. As you can imagine literally everywhere inside is air conditioned, even some bus stops are! Due to the lower latitude the days are also quite short (at least compared to Europe), so solar less effective without some sort of backup or storage. The desalination plants are usually combined with power plants. The main source of fuel for power generation is natural gas, which is a by-product of oil drilling and often just burned off as it's harder to transport or store. Clean water is needed to run the turbines, so sea water is desalinated and then afterwards used for the water supply. It leads to an overall efficiency of ~86%, but if you assume the gas would have just be burnt off it's effectively free energy.
    - rbanffy 10y ago
      Some cooling systems make ice when energy prices are lower to use as a heat sink when energy prices are higher. The same principle can be applied here - during day the energy is used to cool and to make enough ice for cooling to last through the night.
    - dx034 10y ago
      Ok, agree with the AC, but you could use an ice storage solution as proposed in the other comment (at least for commercial buildings). For desalination, you could still use solar power for desalination plants and sell the natural gas instead of burning it? At 2.5c/mwh I can imagine that it's more lucrative to switch power and sell the gas to a country like US or UK where NatGas is needed for power plants as solar power is much more expensive.
      - pm90 10y ago
        It is a thoughtful suggestion but Im guessing that if it was possible to ship off that gas and make a profit, it probably would have already been done. Perhaps its not that cost effective right now. In any case, I think now is a good time for them to invest in developing these alternatives, perhaps on a smaller scale, so that when they run out of all the plentiful fossil fuels, they would then have another system that meets their needs.
      - deleted 10y ago
        [deleted]
    - deleted 10y ago
      [deleted]
- jessriedel 10y ago
  Yea, by way of Tyler Cowen, there is good reason to think that storage costs are dominant: http://marginalrevolution.com/marginalrevolution/2016/08/further-research-on-the-limits-of-solar-energy.html http://marginalrevolution.com/marginalrevolution/2016/08/fur... http://marginalrevolution.com/marginalrevolution/2016/07/what-are-the-costs-of-solar-power-intermittency.html http://marginalrevolution.com/marginalrevolution/2016/07/wha... Still unclear whether future developments (like mass desalinization mentioned by dx034) will change this. Or storage just could become unexpectedly cheaper, like solar itself did.
- diafygi 10y ago
  You can get to approximately 50% penetration safely without storage[1], then you have to start adding factors that can deal with intermittent sources like wind and solar[2]. It doesn't have to be storage, either. You can used demand response signals to outsource your "storage" by paying people to turn off their electric vehicle charging or ice manufacturing for a period of time. In energy, reducing demand has the same result as increasing supply. Additionally, in hotter places like the UAE, solar irradiation tends to correlate much more with grid load, since cooling is the primary energy use. So, you could safely push well beyond the 50% penetration point for solar/wind. [1]: https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc_2013.pdf https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc... [2]: https://www1.eere.energy.gov/solar/pdfs/2010ulw_ellis.pdf https://www1.eere.energy.gov/solar/pdfs/2010ulw_ellis.pdf
  - Loic 10y ago
    > solar irradiation tends to correlate much more with grid load. This is a very interesting remark. Last week, we had relatively high temperatures in Germany and France (above 30°C). In Germany, because the weather was perfect for solar, this reduced the middle of the day spot price where in France, this increased the spot price[0]. [0]: https://www.eex.com/en/ https://www.eex.com/en/ "European Energy Exchange"
    - brownbat 10y ago
      In the US, the peaks are in the afternoon, when you have a mix of business and residential use along with lingering high temperatures in summer.[0] In the UK, meanwhile, peak load is driven by tea kettles and Eastenders.[1] [0a] http://cleantechnica.com/2014/07/21/utilities-cry-fowl-over-duck-chart-and-distributed-solar-powercrying-fowl-or-crying-wolf-open-season-on-the-utilitys-solar-duck-chart/ http://cleantechnica.com/2014/07/21/utilities-cry-fowl-over-... [0b] http://businesstech.co.za/news/hardware/86252/new-battery-tech-will-change-how-we-use-power/ http://businesstech.co.za/news/hardware/86252/new-battery-te... [0c] https://www.cnet.com/news/a-technology-race-to-curb-peak-energy-demand/ https://www.cnet.com/news/a-technology-race-to-curb-peak-ene... [0d] There's a great NPR viz on power sources around the US, though somewhat dated now: http://www.npr.org/2009/04/24/110997398/visualizing-the-u-s-electric-grid http://www.npr.org/2009/04/24/110997398/visualizing-the-u-s-... [1] http://www.bbc.co.uk/britainfromabove/stories/people/teatimebritain.shtml http://www.bbc.co.uk/britainfromabove/stories/people/teatime...
ptaipale 10y ago
How is this "cheapest solar"? There are many instances where solar electricity price is negative.
- unchocked 10y ago
  This is a bulk power purchase agreement, not a spot price.
  - yessql 10y ago
    This is the correct answer.
  - deleted 10y ago
    [deleted]
- ars 10y ago
  > There are many instances where solar electricity price is negative. That's not how it works. When someone wants to buy power they get bids, the bids are sorted by price, and capacity. Then they work their way through the list, cheapest first, till they meet the capacity they need. And then pay the (same) TOP price to everyone! NOT the price they bid. So "negative" is just a tactic to get a good position on the list. Risky if you are a normal fuel-based plant, since you might actually have to make good on it. Not risky for solar power (but not something they actually want). If everyone was solar, they would never use negative prices - they might actually have to make good on that. It only works because their capacity is so low they are never the top bid.
  - Fede_V 10y ago
    Thanks for the explanation, that makes a lot of sense.
- barney54 10y ago
  I'm not sure there are cases where solar is negative, but there is with wind. That's because in the IS wind producers get paid the wind production tax credit when they produce electricity regardless of demand. So you can have negative prices over night when you get a lot of wind and low electricity demand.
splike 10y ago
Efficient renewable energy is great, but isn't the problem storage of that energy? Without storage, the energy generated by renewables needs to be used up by the grid immediately. Won't most of it be wasted?
- cm3 10y ago
  I've been wondering why AC units for buildings don't come in solar cell combi packages, where if it's hot, it's sunny, so the ac can be powered by the sun, ideally making it a zero sum calculation.
  - __Joker 10y ago
    Because it is not cost effective. Fossil fuel is still cheaper. Unless solar prices ( installation- panel, batteries) comes down or subsidised to match those existing prices, it will still take some time .
    - toomuchtodo 10y ago
      Wind is already cheaper than fossil fuels unsubsidized; solar will get there in the next 12-18 months (without storage).
  - pilom 10y ago
    Because the amount of solar required to power an air conditioner is significantly larger than the air conditioner itself and often you need more solar than you have roof space for buildings 2 stories and greater. (i.e. the total amount of solar you can fit on the roof of a 4 story building will likely not be sufficient to run the air conditioner required to cool that building.)
  - tim333 10y ago
    You can get them on Alibaba https://www.alibaba.com/product-detail/working-10hours-18-hours-SUNCHI-100_884031161.html https://www.alibaba.com/product-detail/working-10hours-18-ho...
- crdoconnor 10y ago
nobrains 10y ago
How does that compare to other existing energy generation sources today?
- diafygi 10y ago
  The investment firm Lazard has a nice report[1] on comparing U.S. energy costs by source. Here's the costs in the U.S. (without counting subsidies): * Wind: $ 32/MWh * Solar: $ 43/MWh * Natural Gas: $ 52/MWh * Coal: $ 65/MWh * Geothermal: $ 82/MWh * Biomass: $ 82/MWh * Nuclear: $ 97/MWh * Solar+Storage: $ 119/MWh * Diesel: $ 212/MWh So wind and solar are currently the cheapest, but you can only get to about 50% penetration with those without storage[2]. The rest has to be "dispatchable". [1]: https://www.lazard.com/media/2390/lazards-levelized-cost-of-energy-analysis-90.pdf https://www.lazard.com/media/2390/lazards-levelized-cost-of-... [2]: https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc_2013.pdf https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc...
  - deleted 10y ago
    [deleted]
  - crdoconnor 10y ago
    >So wind and solar are currently the cheapest, but you can only get to about 50% penetration with those without storage[2]. The rest has to be "dispatchable". That % will probably go up as the demand side of the market reacts to variable pricing. We've barely scratched the surface of what's possible in terms of demand shifting.
  - barney54 10y ago
    One issue with these numbers that they are making and apples-to-oranges comparison with non-dispatchable sources (wind and solar) and dispatchable sources. There is value to being able to turn on and off a generation source that isn't accounted for here.
    - JshWright 10y ago
mrfusion 10y ago
I'm confused why these are in units of energy kWh? Shouldn't the just be watts a unit of power?
- Justin_K 10y ago
  Because the unit of measure takes into account how long you used a watt. It's a measure of rate... Sort of like a car uses mph.
  - cellularmitosis 10y ago
    I don't think you've addressed his question. GP was expecting to see a price in terms of $/W, because that's what matters to consumers interesting in purchasing panels: https://en.wikipedia.org/wiki/Price_per_watt https://en.wikipedia.org/wiki/Price_per_watt The article quotes a price in terms of $/kWh, because that's how a bid from an industrial electricity provider is stated. GP was confused / frustrated because a bid in $/kWh completely obscures the cost of the hardware, which is what he's interested in.
- phaemon 10y ago
  I'm confused why you're confused. You pay for energy, not for power. You wouldn't pay the same for a kW delivered for 1 hour as you would for a kW delivered for a whole year, right?
  - jessaustin 10y ago
    When you buy solar panels, or build what TFA called "a solar plant capable of generating at least 350 megawatts" (note the units) you certainly are paying for power. Quoting an energy price hides all sorts of assumptions about finance, equipment longevity, and maintenance costs, so it's clear that doing so is just an excuse to say "cheapest solar on record".
    - yessql 10y ago
      The people who build the power plant pay for MW of solar panels. The people who buy the energy from the power plant pay for kWh. Notice that this an interesting article because the plant is going to have a power purchase agreement price of under 2.5 cents per kWh. We don't know what the equipment costs per Watt.
bmetz 10y ago
I'm gung-ho on solar but the article clearly says there is a low penalty for going over budget. They may just be guessing where prices will be by the time they have to pay for the panels.
ZeroGravitas 10y ago
Solar seems to be getting cheaper every year, and has been for decades now so at what point does this headline become boring or redundant?
- g52oevr0in 10y ago
  Never, just like the headlines about the new biggest disk drive.
- tim333 10y ago
  It's getting more interesting now because it's becoming competitive with other sources.
cowardlydragon 10y ago
What kind of solar were these? I read the first couple pages and my skim didn't find them. If they aren't perovskite (and probably can't be since those are oh-so-close but not being manufactured), that raises two exciting possiblities: 1) another jump when perovskit ~20% efficient cells are produced en masse 2) The hybrid perovskite + other types variants that give even better efficiency with mixed costs... As I understand it, the only challenge with perovskites now is that they break down in contact with humidity IIRC. Great for deserts though?

86 points by Osiris30 10y ago

Under 2.5 cents per a kWh is very cheap, but I'm guessing there are other costs like storage on top? Anyways will be interesting to see for the future if solar actually becomes a more dominant source of energy worldwide.

deleted 10y ago
[deleted]
dx034 10y ago
I guess most energy in UAE is used for cooling which should be highly correlated to solar output. They could probably meet most of their energy demand with solar power without significant amount of storage. Furthermore, desalination will probably also play a major role in electricity consumption and I can imagine that plants can be adjusted to solar power production instead of running them at the same level 24/7 (pure speculation, no idea how the technology behind this works). Edit: All water in UAE comes from desalination[0], so using clean water storage with larger plants instead of energy storage could be cheaper. [0] https://en.wikipedia.org/wiki/Water_supply_and_sanitation_in_Abu_Dhabi https://en.wikipedia.org/wiki/Water_supply_and_sanitation_in...
- lucaspiller 10y ago
  > They could probably meet most of their energy demand with solar power without significant amount of storage. Not really, I was living in Dubai last year, and during the summer it was around 48C/120F in the day but it's still 35C/95F+ at night. As you can imagine literally everywhere inside is air conditioned, even some bus stops are! Due to the lower latitude the days are also quite short (at least compared to Europe), so solar less effective without some sort of backup or storage. The desalination plants are usually combined with power plants. The main source of fuel for power generation is natural gas, which is a by-product of oil drilling and often just burned off as it's harder to transport or store. Clean water is needed to run the turbines, so sea water is desalinated and then afterwards used for the water supply. It leads to an overall efficiency of ~86%, but if you assume the gas would have just be burnt off it's effectively free energy.
  - rbanffy 10y ago
    Some cooling systems make ice when energy prices are lower to use as a heat sink when energy prices are higher. The same principle can be applied here - during day the energy is used to cool and to make enough ice for cooling to last through the night.
  - dx034 10y ago
    Ok, agree with the AC, but you could use an ice storage solution as proposed in the other comment (at least for commercial buildings). For desalination, you could still use solar power for desalination plants and sell the natural gas instead of burning it? At 2.5c/mwh I can imagine that it's more lucrative to switch power and sell the gas to a country like US or UK where NatGas is needed for power plants as solar power is much more expensive.
    - pm90 10y ago
      It is a thoughtful suggestion but Im guessing that if it was possible to ship off that gas and make a profit, it probably would have already been done. Perhaps its not that cost effective right now. In any case, I think now is a good time for them to invest in developing these alternatives, perhaps on a smaller scale, so that when they run out of all the plentiful fossil fuels, they would then have another system that meets their needs.
    - deleted 10y ago
      [deleted]
  - deleted 10y ago
    [deleted]
jessriedel 10y ago
Yea, by way of Tyler Cowen, there is good reason to think that storage costs are dominant: http://marginalrevolution.com/marginalrevolution/2016/08/further-research-on-the-limits-of-solar-energy.html http://marginalrevolution.com/marginalrevolution/2016/08/fur... http://marginalrevolution.com/marginalrevolution/2016/07/what-are-the-costs-of-solar-power-intermittency.html http://marginalrevolution.com/marginalrevolution/2016/07/wha... Still unclear whether future developments (like mass desalinization mentioned by dx034) will change this. Or storage just could become unexpectedly cheaper, like solar itself did.
diafygi 10y ago
You can get to approximately 50% penetration safely without storage[1], then you have to start adding factors that can deal with intermittent sources like wind and solar[2]. It doesn't have to be storage, either. You can used demand response signals to outsource your "storage" by paying people to turn off their electric vehicle charging or ice manufacturing for a period of time. In energy, reducing demand has the same result as increasing supply. Additionally, in hotter places like the UAE, solar irradiation tends to correlate much more with grid load, since cooling is the primary energy use. So, you could safely push well beyond the 50% penetration point for solar/wind. [1]: https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc_2013.pdf https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc... [2]: https://www1.eere.energy.gov/solar/pdfs/2010ulw_ellis.pdf https://www1.eere.energy.gov/solar/pdfs/2010ulw_ellis.pdf
- Loic 10y ago
  > solar irradiation tends to correlate much more with grid load. This is a very interesting remark. Last week, we had relatively high temperatures in Germany and France (above 30°C). In Germany, because the weather was perfect for solar, this reduced the middle of the day spot price where in France, this increased the spot price[0]. [0]: https://www.eex.com/en/ https://www.eex.com/en/ "European Energy Exchange"
  - brownbat 10y ago
    In the US, the peaks are in the afternoon, when you have a mix of business and residential use along with lingering high temperatures in summer.[0] In the UK, meanwhile, peak load is driven by tea kettles and Eastenders.[1] [0a] http://cleantechnica.com/2014/07/21/utilities-cry-fowl-over-duck-chart-and-distributed-solar-powercrying-fowl-or-crying-wolf-open-season-on-the-utilitys-solar-duck-chart/ http://cleantechnica.com/2014/07/21/utilities-cry-fowl-over-... [0b] http://businesstech.co.za/news/hardware/86252/new-battery-tech-will-change-how-we-use-power/ http://businesstech.co.za/news/hardware/86252/new-battery-te... [0c] https://www.cnet.com/news/a-technology-race-to-curb-peak-energy-demand/ https://www.cnet.com/news/a-technology-race-to-curb-peak-ene... [0d] There's a great NPR viz on power sources around the US, though somewhat dated now: http://www.npr.org/2009/04/24/110997398/visualizing-the-u-s-electric-grid http://www.npr.org/2009/04/24/110997398/visualizing-the-u-s-... [1] http://www.bbc.co.uk/britainfromabove/stories/people/teatimebritain.shtml http://www.bbc.co.uk/britainfromabove/stories/people/teatime...

ptaipale 10y ago

How is this "cheapest solar"? There are many instances where solar electricity price is negative.

unchocked 10y ago
This is a bulk power purchase agreement, not a spot price.
- yessql 10y ago
  This is the correct answer.
- deleted 10y ago
  [deleted]
ars 10y ago
> There are many instances where solar electricity price is negative. That's not how it works. When someone wants to buy power they get bids, the bids are sorted by price, and capacity. Then they work their way through the list, cheapest first, till they meet the capacity they need. And then pay the (same) TOP price to everyone! NOT the price they bid. So "negative" is just a tactic to get a good position on the list. Risky if you are a normal fuel-based plant, since you might actually have to make good on it. Not risky for solar power (but not something they actually want). If everyone was solar, they would never use negative prices - they might actually have to make good on that. It only works because their capacity is so low they are never the top bid.
- Fede_V 10y ago
  Thanks for the explanation, that makes a lot of sense.
barney54 10y ago
I'm not sure there are cases where solar is negative, but there is with wind. That's because in the IS wind producers get paid the wind production tax credit when they produce electricity regardless of demand. So you can have negative prices over night when you get a lot of wind and low electricity demand.

splike 10y ago

Efficient renewable energy is great, but isn't the problem storage of that energy? Without storage, the energy generated by renewables needs to be used up by the grid immediately. Won't most of it be wasted?

cm3 10y ago
I've been wondering why AC units for buildings don't come in solar cell combi packages, where if it's hot, it's sunny, so the ac can be powered by the sun, ideally making it a zero sum calculation.
- __Joker 10y ago
  Because it is not cost effective. Fossil fuel is still cheaper. Unless solar prices ( installation- panel, batteries) comes down or subsidised to match those existing prices, it will still take some time .
  - toomuchtodo 10y ago
    Wind is already cheaper than fossil fuels unsubsidized; solar will get there in the next 12-18 months (without storage).
- pilom 10y ago
  Because the amount of solar required to power an air conditioner is significantly larger than the air conditioner itself and often you need more solar than you have roof space for buildings 2 stories and greater. (i.e. the total amount of solar you can fit on the roof of a 4 story building will likely not be sufficient to run the air conditioner required to cool that building.)
- tim333 10y ago
  You can get them on Alibaba https://www.alibaba.com/product-detail/working-10hours-18-hours-SUNCHI-100_884031161.html https://www.alibaba.com/product-detail/working-10hours-18-ho...
crdoconnor 10y ago

nobrains 10y ago

How does that compare to other existing energy generation sources today?

diafygi 10y ago
The investment firm Lazard has a nice report[1] on comparing U.S. energy costs by source. Here's the costs in the U.S. (without counting subsidies): * Wind: $ 32/MWh * Solar: $ 43/MWh * Natural Gas: $ 52/MWh * Coal: $ 65/MWh * Geothermal: $ 82/MWh * Biomass: $ 82/MWh * Nuclear: $ 97/MWh * Solar+Storage: $ 119/MWh * Diesel: $ 212/MWh So wind and solar are currently the cheapest, but you can only get to about 50% penetration with those without storage[2]. The rest has to be "dispatchable". [1]: https://www.lazard.com/media/2390/lazards-levelized-cost-of-energy-analysis-90.pdf https://www.lazard.com/media/2390/lazards-levelized-cost-of-... [2]: https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc_2013.pdf https://people.eecs.berkeley.edu/~vsmith/docs/renewables_sgc...
- deleted 10y ago
  [deleted]
- crdoconnor 10y ago
  >So wind and solar are currently the cheapest, but you can only get to about 50% penetration with those without storage[2]. The rest has to be "dispatchable". That % will probably go up as the demand side of the market reacts to variable pricing. We've barely scratched the surface of what's possible in terms of demand shifting.
- barney54 10y ago
  One issue with these numbers that they are making and apples-to-oranges comparison with non-dispatchable sources (wind and solar) and dispatchable sources. There is value to being able to turn on and off a generation source that isn't accounted for here.
  - JshWright 10y ago

mrfusion 10y ago

I'm confused why these are in units of energy kWh? Shouldn't the just be watts a unit of power?

Justin_K 10y ago
Because the unit of measure takes into account how long you used a watt. It's a measure of rate... Sort of like a car uses mph.
- cellularmitosis 10y ago
  I don't think you've addressed his question. GP was expecting to see a price in terms of $/W, because that's what matters to consumers interesting in purchasing panels: https://en.wikipedia.org/wiki/Price_per_watt https://en.wikipedia.org/wiki/Price_per_watt The article quotes a price in terms of $/kWh, because that's how a bid from an industrial electricity provider is stated. GP was confused / frustrated because a bid in $/kWh completely obscures the cost of the hardware, which is what he's interested in.
phaemon 10y ago
I'm confused why you're confused. You pay for energy, not for power. You wouldn't pay the same for a kW delivered for 1 hour as you would for a kW delivered for a whole year, right?
- jessaustin 10y ago
  When you buy solar panels, or build what TFA called "a solar plant capable of generating at least 350 megawatts" (note the units) you certainly are paying for power. Quoting an energy price hides all sorts of assumptions about finance, equipment longevity, and maintenance costs, so it's clear that doing so is just an excuse to say "cheapest solar on record".
  - yessql 10y ago
    The people who build the power plant pay for MW of solar panels. The people who buy the energy from the power plant pay for kWh. Notice that this an interesting article because the plant is going to have a power purchase agreement price of under 2.5 cents per kWh. We don't know what the equipment costs per Watt.

bmetz 10y ago

I'm gung-ho on solar but the article clearly says there is a low penalty for going over budget. They may just be guessing where prices will be by the time they have to pay for the panels.

ZeroGravitas 10y ago

Solar seems to be getting cheaper every year, and has been for decades now so at what point does this headline become boring or redundant?

g52oevr0in 10y ago
Never, just like the headlines about the new biggest disk drive.
tim333 10y ago
It's getting more interesting now because it's becoming competitive with other sources.

cowardlydragon 10y ago

What kind of solar were these? I read the first couple pages and my skim didn't find them. If they aren't perovskite (and probably can't be since those are oh-so-close but not being manufactured), that raises two exciting possiblities: 1) another jump when perovskit ~20% efficient cells are produced en masse 2) The hybrid perovskite + other types variants that give even better efficiency with mixed costs... As I understand it, the only challenge with perovskites now is that they break down in contact with humidity IIRC. Great for deserts though?