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"Tidal Lagoon Swansea Bay is thought to be seeking a guaranteed subsidised price of about £168 for every megawatt-hour (MWh) of electricity it generates over a

by quokwok 12y ago

"Tidal Lagoon Swansea Bay is thought to be seeking a guaranteed subsidised price of about £168 for every megawatt-hour (MWh) of electricity it generates over a 35-year period – almost four times the current market price of power." http://www.telegraph.co.uk/finance/newsbysector/energy/11426748/Swansea-Bay-tidal-lagoon-appalling-value-for-money-says-Citizens-Advice.html http://www.telegraph.co.uk/finance/newsbysector/energy/11426...

Alphasite_ 12y ago
I'd assume that 35 years of inflation needs to be factored in as well, at 2% that would half subsidy by that point. Also, there is an inherent cost to green power, if it was cheap power companies would flock to build them of their own accord, but of course they dont, so the government has to subside them.
- quokwok 12y ago
  If something has negative externalities, the solution is to tax the externality. E.g. a carbon tax will raise the price of fossil-fuel energy, which will make some green energy projects worth building. That's it -- job done. Subsidising "good" projects is instead of taxing bad projects is the wrong way to do it, because the government has to evaluate every project proposal to figure out which projects should be subsidised. Whereas a carbon tax does it for you; all the government needs to figure out is the cost of carbon, and the market takes care of the rest.
- scottkduncan 12y ago
  Timestamp this and come back in three years because we are basically sitting on the tipping point of some clean energy sources (not the one in this article!) becoming cost competitive. Solar and wind are at grid parity in an increasing number of places (Deutsche Bank says 47 of 50 states by 2016) and innovations in financing will be able to pick up the slack if/when subsidies expire.
7952 12y ago
Presumably the barrages will last >100 year and be able to generate power the entire time. In the long run it could be much cheaper.
- achamayou 12y ago
  It likely won't, because it will be heavily silted before then, and dredging a lagoon that size is really quite expensive.
achamayou 12y ago
At GBP1bn for 320MW, this doesn't look too good. If the numbers on wikipedia for the Sihwa Lake Tidal Power Station [0] are right (254MW for GBP180m), this is prohibitively expensive, even for the technology. [0] http://en.wikipedia.org/wiki/Sihwa_Lake_Tidal_Power_Station http://en.wikipedia.org/wiki/Sihwa_Lake_Tidal_Power_Station
Brakenshire 12y ago
That's for the first plant, the other 7 are expected to cost the same as the recent nuclear power deal for Hinckley C. That's in the BBC article. I actually think that's pretty amazing as a first off price. By contrast, solar panels have only got to where they are today because governments (principally but not exclusively in Germany) subsidized them for decades at two to three times that level. God know how many billions of subsidies have gone in nuclear, and the strike price is still high. Or, for that matter, into traditional energy technology and infrastructure. Many new technologies do require up front subsidies in order to develop, and that's sensible as long as there is a credible path to reducing the cost. Solar panels are just now starting to become competitive, if this technology could do it second or third time out, that is something to be lauded.

by quokwok 12y ago

Alphasite_ 12y ago

I'd assume that 35 years of inflation needs to be factored in as well, at 2% that would half subsidy by that point. Also, there is an inherent cost to green power, if it was cheap power companies would flock to build them of their own accord, but of course they dont, so the government has to subside them.

quokwok 12y ago
If something has negative externalities, the solution is to tax the externality. E.g. a carbon tax will raise the price of fossil-fuel energy, which will make some green energy projects worth building. That's it -- job done. Subsidising "good" projects is instead of taxing bad projects is the wrong way to do it, because the government has to evaluate every project proposal to figure out which projects should be subsidised. Whereas a carbon tax does it for you; all the government needs to figure out is the cost of carbon, and the market takes care of the rest.
scottkduncan 12y ago
Timestamp this and come back in three years because we are basically sitting on the tipping point of some clean energy sources (not the one in this article!) becoming cost competitive. Solar and wind are at grid parity in an increasing number of places (Deutsche Bank says 47 of 50 states by 2016) and innovations in financing will be able to pick up the slack if/when subsidies expire.

7952 12y ago

Presumably the barrages will last >100 year and be able to generate power the entire time. In the long run it could be much cheaper.

achamayou 12y ago
It likely won't, because it will be heavily silted before then, and dredging a lagoon that size is really quite expensive.

achamayou 12y ago

At GBP1bn for 320MW, this doesn't look too good. If the numbers on wikipedia for the Sihwa Lake Tidal Power Station [0] are right (254MW for GBP180m), this is prohibitively expensive, even for the technology. [0] http://en.wikipedia.org/wiki/Sihwa_Lake_Tidal_Power_Station http://en.wikipedia.org/wiki/Sihwa_Lake_Tidal_Power_Station

Brakenshire 12y ago

That's for the first plant, the other 7 are expected to cost the same as the recent nuclear power deal for Hinckley C. That's in the BBC article. I actually think that's pretty amazing as a first off price. By contrast, solar panels have only got to where they are today because governments (principally but not exclusively in Germany) subsidized them for decades at two to three times that level. God know how many billions of subsidies have gone in nuclear, and the strike price is still high. Or, for that matter, into traditional energy technology and infrastructure. Many new technologies do require up front subsidies in order to develop, and that's sensible as long as there is a credible path to reducing the cost. Solar panels are just now starting to become competitive, if this technology could do it second or third time out, that is something to be lauded.