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The ramp up is inherently slow, we’re still generally seeing cheaper nighttime rates than daytime rates even after years of ‘heavy’ investment in solar. Solar
by Retric 3y ago
The ramp up is inherently slow, we’re still generally seeing cheaper nighttime rates than daytime rates even after years of ‘heavy’ investment in solar.
Solar’s impact on prices is going to remain fairly trivial for the next few years. But start looking 20 years out and a great deal of nighttime load will shift, which dramatically reduces the need for storage even as decades of X0 GW per year adds up.
Aka it’s not just one trend you need to follow but several.
- 7thaccount 3y agoThe merit order effect of renewables like solar and wind has already been substantial on wholesale prices with the spot price being $0 or below $0 in significant percentages of the year. This probably hasn't trickled down to retail rates as we're stuck paying for the fixed costs of many of those assets via the PPAs that the utilities sign.
- pfdietz 3y agoThus the rapidly expanding introduction of storage, which can take advantage of those periods.
- matthewdgreen 3y ago3400GW of solar nameplate is expected to be built from 2023 to 2028 globally, which is maybe 40% of all existing global electrical generation. So I don’t think “20 years” is the right time period to be thinking in.
- delecti 3y agoThat's shifting generation, not demand. Most people won't respond immediately, so 20 years isn't a crazy guess for a significant amount of the equipment in peoples' houses to cycle out.
- Retric 3y agoUS produced ~4% of its electricity from solar in 2023 and it’s predicted to hit 5.6% in 2024 and 7.0% in 2025. So ~4 years to break 10% of total generation which still doesn’t offset higher daytime demand. Thus for the next few years we’ll see higher daytime rates than nighttime outside of specific regions and specific times of the year. Beyond that you need to consider increasing EV adoption, energy storage etc. Cheaper daytime rates is going to happen faster than people realize, but not fast.
- matthewdgreen 3y agoLooking to the US to be on the cutting edge of the energy transition is like looking to the US to be on the cutting edge of steam engine development during the early Industrial Revolution. In a global sense, prices are going to change rapidly and huge amounts of industry will adapt to intermittent sources. The US will catch up a decade later, adopting whatever ideas worked overseas.
- Retric 3y agoThe US close to average in terms of solar with most countries are on a similar curve +/- a few years. However, I used the US because our electricity demand is fairly static. The US is only up 13% since 2000 unlike Africa’s electricity demand which doubled, or China’s 600% increase over that period.
- matthewdgreen 3y agoChina is where energy things are happening, both on the generation side and on the industrial consumption side. The US feels like a quiet backwater in comparison.
- Retric 3y agoOnly in terms of scale not innovation. China still gets most of its elected from coal and hydro. They are still building a little nuclear and lots of coal alongside all that wind and solar.