6 ms·

Solar, wind plus batteries (and other intermittent sources) are only cheaper because it is subsidized by the base power stations. Only about 20% of the cost of

Solar, wind plus batteries (and other intermittent sources) are only cheaper because it is subsidized by the base power stations. Only about 20% of the cost of coal and 5% of nuclear comes from the fuel. Almost all costs are fixed costs. They need to be paid regardless of whether people use the power or not. But in the current system, those who use solar or wind and only use base power occasionally aren't paying those costs. Instead everyone else has to cover those costs, which is why the price of electricity skyrockets wherever there are more 'renewable' (or specifically, 'intermittent') sources. This is why electricity costs 10c per kwh in many parts of the US, but 40c per kwh in European countries with lots of windmills. basically it is a huge market distortion. The real cost of base power is a fixed yearly fee to get access, then 2c per kwh after that (i.e the 20% fuel cost). If this is what was charged no one would use wind or solar at all. (or you would have people using solar but disconnected from the grid, which would be great too).

cinntaile 5y ago
What costs aren't being paid for exactly?
- acidburnNSA 5y ago
  The ones that ensure with several 9's that the lights come on 24/7 regardless of time of day or weather. LCOE covers the generator alone, but not transmission lines, idled gas plants, energy storage, smart load balancing, etc. You can keep big gas plants around in a high intermittent grid and fire them up 10% of the time. The way we view LCOE right now, those plants would be insanely expensive while wind/solar would be super cheap. But we would still pay for the backup capacity. This kind of system cost is what matters dramatically more than LCOE.
  - cinntaile 5y ago
    LCOE is just an investment tool to figure out where you get the most bang for your buck as an investor. It does not tell us what the best option is for the energy system as a whole.
    - acidburnNSA 5y ago
      I know. Yet it is being used to say what energy tech is cheapest.
      - cinntaile 5y ago
        The thing that bothers me about the whole energy discussion is that there seems to be little room for a middle ground, it's just a political discussion at this point. In reality we won't have 100% renewables and we won't have 100% nuclear either. Neither of those 2 options, at their extremes, is best from a cost perspective.
- coryrc 5y ago
  Grid stability/storage, plus sunk costs. Say it's a cold cloudy day with no wind and it's been so for a week. You'll need the capacity of that coal/nuclear plant those days. And let's say every other day of the year solar and wind make enough power. So who pays the extremely high fixed cost of the nuclear and coal plant so it's available that one week you need it? No one wants to, so they're shutting them down. The power company could still be paying the bond for the plant, but ultimately that's the consumer's money. Then, surprise, you end up with blackouts or you pay for new natural gas plants to be built. Prices and fragility go up. It's likely cheaper to make demand more flexible, but that has a cost too.
  - pydry 5y ago
    Grid scale batteries have become cost effective in the last two years. It'll take time to build out capacity but it'll take more time AND cost to build new nuclear plants.
    - mrjangles 5y ago
      This is something people get confused about. Grid scale batteries are definitely not cost effective or in existence. The media does their best to obfuscate this. What has been built around the places are battery packs to absorb dangerous power fluctuations caused by windmills. They destroyed the grid in South Australia a few years ago, and Elon Musk famously went in and installed batteries (maybe that is what you are thinking of). If you don't believe me go back and have a look at how big the batteries were. The 500 million dollar project installed 130 MWh worth of electricity storage. That is enough to produce the same energy as a power station for 10 minutes before being fully drained.
      - pydry 5y ago
        I'm thinking of battery backed solar farm in Hawaii that cost around $70/MwH and supplied about 1/5th of the power for the island. There's a few new projects in California/Nevada/Colorado that are allegedly costing around $30-40MwH (although I'm skeptical of how much storage they have for that price). Either way, conservatively speaking, $50-60/MwH for battery backed wind/solar on the mainland seems fairly doable. Prices will likely keep dropping too. By contrast, in the UK Hinkley Point C is being paid $124/MwH guaranteed for 20 years. It doesn't exist because it's a cost effective way of supplying green energy that's for sure, but it does bolster the nuclear economy. The military do like to hire nuclear technicians and buy parts for PWRs in nuclear subs, etc. and somebody has to pay for these things. Rate payers, I guess.
Krasnol 5y ago
If you'd add the cost of maintaining radioactive waste for thousands of years on the cost of power, you'd end up with even higher prices and how do you think those reactors came into existence in the first place? Not even Bill Gates wants to pay for his reactor by himself. Here are state subsidies for energy sources in Germany in Billion: https://i.imgur.com/NbaNLK4.jpeg https://i.imgur.com/NbaNLK4.jpeg Than there is maintenance. EDF will have to pay staggering 100 billion € to increase the life of their fleet for another 10 years and the price won't go down in the future. Even though the fleet is quite well maintained and France relies on it, accidents, overheated rivers, too cold winters force them to buy (often dirty) power from Germany. LCOE for nuclear is only surpassed by peak gas: https://i.imgur.com/gRj8GS0.jpeg https://i.imgur.com/gRj8GS0.jpeg https://zenodo.org/record/5573719 https://zenodo.org/record/5573719 So yeah...number juggling is quite trendy in Shillenbergers Astro-Turf but it won't change the facts: nuclear is too expensive and too slow to fight climate change.
dd36 5y ago
Home solar also doesn’t have to support transmission and distribution lines.
7952 5y ago
What you are talking about is the marginal cost of producing an extra kWh of electricity. That does vary between different sources. For nuclear, solar and wind it is exceptionally low. For gas and coal it is higher due to fuel costs and market volatility (see gas prices now). A further factor is how quickly a generator can turn on, maintenance costs, and fuel efficiency. Also, different locations have better grid connections closer to population centres. These kind of discussions always touch on a few of these points. But actually a well designed market absolutely can take these factors into account and price accordingly. You have strike prices to cover capital costs, capacity markets, bidding to reduce costs etc. The low price of wind is just an acknowledgement that it is less valuable due to intermitancy. But you guarantee the rate regardless of the market because the low CO2 emissions are valuable. Nuclear is expensive because it is more valuable due to low CO2 and low intermitancy. Give it a relatively high subsidised rate. It should be more expensive than wind. Gas peakers are valuable because they can be turned on quickly. But they are dirty. So they charge a high rate but the rate is not guaranteed. The market avoids using them. You could and maybe should replace all of this with a state run electricity company that makes all the decisions. That is really what people are arguing for rather than a particular type of generator. But in an energy market costs need to actually mean something more than a political point.
- mrjangles 5y ago
  While it's nice to believe that through the magic of the market, everything just evens out, a simple thought experiment easily shows this isn't the case. Take the simplest case and ignore CO2 and carbon tax for now. The base power stations have to be sufficient to supply the whole power grid when the wind doesn't blow, and the sun doesn't shine. Ok, so now imagine what happens if we simply remove all the solar panels and all the wind turbines. What happens? Nothing happens. The grid still works normally. In other words the cost of all those windmills, solar panels, their construction, their maintenance, etc, it is all extra cost that the consumer has to pay somehow. So isn't the magic market supposed to fix all this? Why doesn't market dynamics take care of this? Because government regulation doesn't allow fixed power plants to charge a fixed yearly fee. If the government did allow this then the market would indeed price everything correctly. Now if you add a carbon tax, having a number of windmills on the side does eventually become advantageous, but never compared to non-intermittent sources of renewable power like hydro or nuclear which could also charge this fixed yearly fee.

cinntaile 5y ago

What costs aren't being paid for exactly?

acidburnNSA 5y ago
The ones that ensure with several 9's that the lights come on 24/7 regardless of time of day or weather. LCOE covers the generator alone, but not transmission lines, idled gas plants, energy storage, smart load balancing, etc. You can keep big gas plants around in a high intermittent grid and fire them up 10% of the time. The way we view LCOE right now, those plants would be insanely expensive while wind/solar would be super cheap. But we would still pay for the backup capacity. This kind of system cost is what matters dramatically more than LCOE.
- cinntaile 5y ago
  LCOE is just an investment tool to figure out where you get the most bang for your buck as an investor. It does not tell us what the best option is for the energy system as a whole.
  - acidburnNSA 5y ago
    I know. Yet it is being used to say what energy tech is cheapest.
    - cinntaile 5y ago
      The thing that bothers me about the whole energy discussion is that there seems to be little room for a middle ground, it's just a political discussion at this point. In reality we won't have 100% renewables and we won't have 100% nuclear either. Neither of those 2 options, at their extremes, is best from a cost perspective.
coryrc 5y ago
Grid stability/storage, plus sunk costs. Say it's a cold cloudy day with no wind and it's been so for a week. You'll need the capacity of that coal/nuclear plant those days. And let's say every other day of the year solar and wind make enough power. So who pays the extremely high fixed cost of the nuclear and coal plant so it's available that one week you need it? No one wants to, so they're shutting them down. The power company could still be paying the bond for the plant, but ultimately that's the consumer's money. Then, surprise, you end up with blackouts or you pay for new natural gas plants to be built. Prices and fragility go up. It's likely cheaper to make demand more flexible, but that has a cost too.
- pydry 5y ago
  Grid scale batteries have become cost effective in the last two years. It'll take time to build out capacity but it'll take more time AND cost to build new nuclear plants.
  - mrjangles 5y ago
    This is something people get confused about. Grid scale batteries are definitely not cost effective or in existence. The media does their best to obfuscate this. What has been built around the places are battery packs to absorb dangerous power fluctuations caused by windmills. They destroyed the grid in South Australia a few years ago, and Elon Musk famously went in and installed batteries (maybe that is what you are thinking of). If you don't believe me go back and have a look at how big the batteries were. The 500 million dollar project installed 130 MWh worth of electricity storage. That is enough to produce the same energy as a power station for 10 minutes before being fully drained.
    - pydry 5y ago
      I'm thinking of battery backed solar farm in Hawaii that cost around $70/MwH and supplied about 1/5th of the power for the island. There's a few new projects in California/Nevada/Colorado that are allegedly costing around $30-40MwH (although I'm skeptical of how much storage they have for that price). Either way, conservatively speaking, $50-60/MwH for battery backed wind/solar on the mainland seems fairly doable. Prices will likely keep dropping too. By contrast, in the UK Hinkley Point C is being paid $124/MwH guaranteed for 20 years. It doesn't exist because it's a cost effective way of supplying green energy that's for sure, but it does bolster the nuclear economy. The military do like to hire nuclear technicians and buy parts for PWRs in nuclear subs, etc. and somebody has to pay for these things. Rate payers, I guess.

Krasnol 5y ago

If you'd add the cost of maintaining radioactive waste for thousands of years on the cost of power, you'd end up with even higher prices and how do you think those reactors came into existence in the first place? Not even Bill Gates wants to pay for his reactor by himself. Here are state subsidies for energy sources in Germany in Billion: https://i.imgur.com/NbaNLK4.jpeg https://i.imgur.com/NbaNLK4.jpeg Than there is maintenance. EDF will have to pay staggering 100 billion € to increase the life of their fleet for another 10 years and the price won't go down in the future. Even though the fleet is quite well maintained and France relies on it, accidents, overheated rivers, too cold winters force them to buy (often dirty) power from Germany. LCOE for nuclear is only surpassed by peak gas: https://i.imgur.com/gRj8GS0.jpeg https://i.imgur.com/gRj8GS0.jpeg https://zenodo.org/record/5573719 https://zenodo.org/record/5573719 So yeah...number juggling is quite trendy in Shillenbergers Astro-Turf but it won't change the facts: nuclear is too expensive and too slow to fight climate change.

dd36 5y ago

Home solar also doesn’t have to support transmission and distribution lines.

7952 5y ago

What you are talking about is the marginal cost of producing an extra kWh of electricity. That does vary between different sources. For nuclear, solar and wind it is exceptionally low. For gas and coal it is higher due to fuel costs and market volatility (see gas prices now). A further factor is how quickly a generator can turn on, maintenance costs, and fuel efficiency. Also, different locations have better grid connections closer to population centres. These kind of discussions always touch on a few of these points. But actually a well designed market absolutely can take these factors into account and price accordingly. You have strike prices to cover capital costs, capacity markets, bidding to reduce costs etc. The low price of wind is just an acknowledgement that it is less valuable due to intermitancy. But you guarantee the rate regardless of the market because the low CO2 emissions are valuable. Nuclear is expensive because it is more valuable due to low CO2 and low intermitancy. Give it a relatively high subsidised rate. It should be more expensive than wind. Gas peakers are valuable because they can be turned on quickly. But they are dirty. So they charge a high rate but the rate is not guaranteed. The market avoids using them. You could and maybe should replace all of this with a state run electricity company that makes all the decisions. That is really what people are arguing for rather than a particular type of generator. But in an energy market costs need to actually mean something more than a political point.

mrjangles 5y ago
While it's nice to believe that through the magic of the market, everything just evens out, a simple thought experiment easily shows this isn't the case. Take the simplest case and ignore CO2 and carbon tax for now. The base power stations have to be sufficient to supply the whole power grid when the wind doesn't blow, and the sun doesn't shine. Ok, so now imagine what happens if we simply remove all the solar panels and all the wind turbines. What happens? Nothing happens. The grid still works normally. In other words the cost of all those windmills, solar panels, their construction, their maintenance, etc, it is all extra cost that the consumer has to pay somehow. So isn't the magic market supposed to fix all this? Why doesn't market dynamics take care of this? Because government regulation doesn't allow fixed power plants to charge a fixed yearly fee. If the government did allow this then the market would indeed price everything correctly. Now if you add a carbon tax, having a number of windmills on the side does eventually become advantageous, but never compared to non-intermittent sources of renewable power like hydro or nuclear which could also charge this fixed yearly fee.