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These analysis are not comparing apples for apples. Renewables don't supply base load and hence they sell energy when people don't need it, which is why they ar
by jamez1 9y ago
These analysis are not comparing apples for apples. Renewables don't supply base load and hence they sell energy when people don't need it, which is why they are achieving lower prices.
Maintenance and depreciation are much larger costs because the asset is the business for wind farms. Who cares how much operating profit you make, if your depreciation is higher than it?
To understand depreciation, consider a guy driving Uber making $30/hr in an $80k merc. He might be making good operating profit, but when you consider he has to replace the car in 5-10 years, spending another $80k, is it really that good?
- epistasis 9y agoAre you claiming that profits don't cover depreciation? Because that directly contradicts the LCoE analysis from Lazard. The LCoE, takes that into account. Dispatchability has no relevance to the profits/depreciation game. Based on these comments I have to agree with another commenter that you're just trolling.
- dbenhur 9y agoYou make no sense with your statement about depreciation. Depreciation is expense which lowers profit. It's the accounting mechanism we use to spread one-time capital cash outlays over the service life of an asset so as to more realistically calculate profit and loss on an ongoing basis.
- nate_meurer 9y ago"Baseload" power is an outdated concept, a relic from a model of generation and distribution that is rapidly disappearing. Here's what the chief economist of the American Petroleum Institute says about it: "Baseload is kind of a historical term. It’s not really relevant to how electricity is produced today…What you need is dispatchability… and [coal and nuclear] are far slower when you compare them to a lot of the technology natural gas plants have."