Clean Power

Published on January 1st, 2014 | by Zachary Shahan


Credit Suisse Projects ~85% Of US Energy Demand Growth Coming From Renewables Through 2025

January 1st, 2014 by  

Credit Suisse on December 20 released a report with some quite bullish projections regarding renewable energy growth and generation in the United States, which someone in the solar industry kindly passed on to me. Here’s the short summary:

Our take: We see an opportunity for renewable energy to take an increasing share of total US power generation, coming in response to state Renewable Portfolio Standards (RPS) and propelled by more competitive costs against conventional generation. We can see the growth in renewables being transformative against conventional expectations with renewables meeting the vast majority of future power demand growth, weighing on market clearing power prices in competitive power markets, appreciably slowing the rate of demand growth for natural gas from the power sector, and requiring significant investment in new renewables.

What percentage of future growth does Credit Suisse say might come from renewables? About 85%.

Renewables will meet most of US demand growth. We estimate that ~85% of future demand growth for power through 2025 (including the impact of coal plant retirements) could be met by renewable generation with compliance to the existing 30 mandatory and 8 voluntary RPS programs. From this we would see over 100 GW of new renewable capacity additions with wind and solar market share more than doubling from 2012 to 2025.

price of solar power drop graph

Solar PV’s rapid cost drop. Credit: Bloomberg New Energy Finance

Other key points are that falling wind and solar costs make them competitive with natural gas, even ignoring externalities. As a result, Credit Suisse has cut its natural gas projections considerably. “We estimate renewables slowing the rate of natural gas demand growth from power generation to <0.5 bcf/d through 2020 versus our prior estimate of 1.0-1.2 bcf/d even when taking into account planned coal plant shutdowns and assumed nuclear plant retirements.”

I think this report and the revisions implicitly highlight something very interesting that is going on in the energy industry. Renewable energy costs are primarily based on the cost of the technologies themselves, while fossil fuel costs are largely based on the fuel sources. As renewable energy grows, the technology costs come down. In the case of fossil fuels, increasing demand brings the price of these finite fuels up. Forecasts should take this into account, but they routinely seem to underestimate renewable technology cost drops, and thus also underestimate renewable energy growth. Credit Suisse, Deutsche Bank, and others that are a bit better at these projections are quickly shifting their forecasts to catch up with the renewable energy revolution we’ve been seeing. This new report from Credit Suisse analysts is certainly one of the most positive I’ve seen. The title of the first section says it all: “Renewables Are Economic and Disruptive to Conventional Markets.”

Credit Suisse analysts see Renewable Energy Standards (RES) as driving much of the coming growth, but they aren’t shy about saying (repeatedly) that renewables are also now cost competitive, and that technology improvements just keep advancing their prospects.

“We think old-line arguments against renewables – too expensive, too intermittent, too remote – will continue to fade, allowing a resource base that is underappreciated in the market but is positioned to have a broad impact on power and energy markets.”

The report projects that wind power, which is exceptionally cheap, will account for about 80% of the renewable energy growth, while solar will account for the other 20% or so. It sees a doubling of installed US wind power between 2012 and 2020, while it sees solar increasing 11 times over — starting from a much smaller installed capacity, of course. Together, solar and wind’s combined market share is projected to grow from ~4% to ~9%. By 2025, Credit Suisse projects that renewables will account for ~12% of US electricity generation.

Key drivers of the increasing competitiveness from wind and solar are a bit different in each of the industries. Wind farms have become a lot more effective at capturing energy from the wind and turning it into electricity. “Wind utilization rates have increased by 15-20 percentage points, with new machines in the same wind resource yielding 50-55% utilization rates from 30-35% in 2007 due to improvements in turbine design, taller towers / bigger blades, and better wind modeling. Higher utilization has led to dramatic drops in levelized costs with many new projects clearing at ~$30/MWh (Exhibit 5-Exhibit 6), in effect ‘creating’ natural gas under 20 year PPAs at less than $3/MMBtu.”

In the case of solar, it’s a story that CleanTechnica readers should be very familiar with — the price of solar technology has fallen off a cliff. “Solar capital costs have continued to bend the cost curve with utility scale PV today at ~$2000 per KW of capacity from $3250 in 2010, lowering levelized costs for utility scale solar to $65-80/MWh from well over $100/MWh and bringing solar to price parity with newbuild natural gas peakers.” Efficiency improvements have also helped solar on this front.

Yes, solar costs came down due to massive oversupply of polysilicon, solar cells, and solar panels. However, as demand has come to match supply again, costs have remained down. In fact, most solar market research firms project that the costs will keep climbing down in the coming few to several years. Furthermore, many big efforts to bring down the soft costs of solar are also now in motion, as these are the costs that make US solar much more expensive than German solar and are now taking up a huge chunk of the solar price pie.

As we’ve written and read numerous times in the past year, all of this also means some hurt for utilities and fossil fuel generators. Renewables are expected to result in lower power prices than were previously projected, while fossil fuel plants will not be able to sell as much of their (more expensive) electricity to the grid, cutting into their profits.

Here’s a snippet regarding the power prices: “Using our bottom-up power market models, the risks we see to power markets are rooted in a slower market recovery as more (and bottom of the stack) generation is added leading to a fundamental step down in power prices $1-2/MWh or ~5% relative to a scenario without significant renewables growth, as the overall supply curve is ‘pushed to the right’ with lower cost renewables added.”

And here’s one regarding the threat to fossil fuel generators: “while generation output will be lower, the operating costs are broadly fixed meaning that coal and natural gas plants will produce less revenues without a change in cost structure, leading to some minor degradation in EPS.”

The entire report is very interesting, with many details that are surely useful to investors and industry insiders. But the overall trend is clear as a sunny day: the future is renewables.

Check out our new 93-page EV report, based on over 2,000 surveys collected from EV drivers in 49 of 50 US states, 26 European countries, and 9 Canadian provinces.

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About the Author

is tryin' to help society help itself (and other species) with the power of the typed word. He spends most of his time here on CleanTechnica as its director and chief editor, but he's also the president of Important Media and the director/founder of EV Obsession, Solar Love, and Bikocity. Zach is recognized globally as a solar energy, electric car, and energy storage expert. Zach has long-term investments in TSLA, FSLR, SPWR, SEDG, & ABB — after years of covering solar and EVs, he simply has a lot of faith in these particular companies and feels like they are good cleantech companies to invest in.


    environmentally friendly BECAUSE NO USE ANY KIND OF FOSSIL FUEL TO

  • sethdayal

    Yup those RES standards are sure working. Can’t even get rid of them in Red states with all of Big Oil’s good old boys slopping it up at the taxpayer subsidy feedin’ station.

    With production credits and renewable energy credits a wind producer can dump power at negative 10 cents a kwh and still make money. Nearly every dime of a wind/solar producers income comes from taxpayer subsidy. No wonder they can sign 4 cent a kwh contracts on top.

    The latest cost of a massive solar utility built in Ontario comes to $5.9 peak watt @ 1.5 Kwh/watt peak (dual axis). Financed at the 10% per annum required by this utilitys – the 45 cents a kwh paid by the state feed in tariff.

    Google “transcanada-acquires-additional-ontario-power-plant-from-canadian-solar”

    When looking at at the cost of Trans Canada’s wind power, it comes to the the 14 cents a kwh provided by the Ontario tariff.

    Unsubsidized with grid system costs due to 5 times transmission requirements, gas backup fees, and surplus dumping cost wind starts at 45 cents a kwh and solar at 80 cents a kwh. This in a market with prices bottomed out by massive Chinese subsidy.

    Since wind/solar nearly always has to backed to 100% of name plate capacity by filthy deadly inefficient fossil plant run inefficiently murdering even today tens of thousands of folks with massive air pollution, there is less gas less air pollution, less GHG’s and far less blood spilled with replaced the renewable gas scam with efficient CCGT plant or at a far lower cost, zero carbon nuclear.

    Google “EE-Levelling_the_playing_field_of_grid_cost”

    Understandably, having only a socialogy diploma, Zach is unable to understand even basic arithmetic and elementary science. For example he uses wacky projections of solar solar cells price curves, to come up with amazing price drops in the installed cost of solar panels, when nearly all of that panel cost is that made up of labour, structural/electrical materials and civils.

    Worse still Zach misses the main point.

    Telling us that the US answer to Global warming is an additional 80 GW peak renewable capacity,20 GW average to 2025, out of a capacity of current 470 GW average total, shows Zach is a Big Oil junk science embracing Warming Denier like Al Gore. Both reject the work of real science from folks like James Hansen telling us that a AGW extinction event is fast approaching, reject the reality that France was able to go from zero to 80% carbon free nuclear in less than 10 years, preferring to wait to 2050 to attain French standards with warm sunbeams and cool breezes murdering a hundred million folks with fossil air pollution while we wait – their blood a worthwhile sacrifice to their religion.

    Google “Scientists Consider Extinction : Are We Falling Off the Climate Precipice?”

    • Bob_Wallace

      “With production credits and renewable energy credits a wind producer can dump power at negative 10 cents a kwh and still make money. ”

      Explain that math to us. Including links to where you’re getting your PTC and energy credit information.

      • sethdayal

        I’ve noticed Bob you are unable to do simple web search’s. Why is that?

        Renewable energy credits have a market and are bought and sold at prices up to 8 cents a kwh. so far.

        That will likely increase drastically as state renewable standards begin to send utility exec’s to jail for non compliance.

        The other is the oft quoted and with any luck soon to expire federal production credit

        • Bob_Wallace

          Renewable energy credits are not available in all states.

          “Up to 8c/kWh” is a cherry-picked number.

          • sethdayal

            Sure Bob I got the info from two reliable industry sources, but the auction isn’t online like spot mid Columbia. Given that the unsubbed cost and feed in tariffs of wind power are 14 cents a kwh and they are signing contracts at 4 cents, I think 8 cents is pretty close.. Usually the credits can be transferred out of state as well. Given that the these things will be worth their weight in gold when the utilities hit RES jail time penalties, I think they are good bet.

            But hell Bob, you got some other info love to see it.

          • Bob_Wallace

            Well, in 2012 the highest REC was 6c in Connecticut, Massachusetts, New Hampshire, and Rhode Island
            . Those aren’t exactly states with a lot of wind capacity.

            Elsewhere the number was below 5c.
            Now, given that REC are pretty much a year to year deal I expect they don’t figure too heavily in a 20 year PPA. If you can’t count on them being there after the current year you’re not going to discount your sales price based on “maybe”.

          • sethdayal

            Well that’s great work Bob, thanks for that.

            So these Big Oil good ole boys are gamblin’ – they love to do that – that utility execs are going to be fighting to the death to buy them RES credits to keep out of jail for the next ten years at least.

            So all other subsidies sales and tax credits aside we see that these guys, remember they own the politicians lock stock and barrel, are getting last year, 8 to 10 cents a kwh before they sign a single contract. Nice.

          • Bob_Wallace

            Wasted characters.

          • sethdayal

            Are you, an AWEA shill Bob. Sure seems.

            I searched the AWEA link you provided and I’m not seeing anything quantifying REC’s. Did I miss something or did you just make it up?

          • Bob_Wallace

            Page 54.

            And it is not an AWEA site. It’s a DOE/EIA site. The EIA 2012 Wind Technologies Market Report.

          • sethdayal

            Thanks Bob my search engine skipped the chart.

            “RECs are purchased to meet state RPS obligations”

            making my point exactly as RPS deadlines get closer – thanks again.

            The study was contracted out by the Big Oil’s EIA, and was not peer reviewed nor published in reputable journal as is usual for this sort of trash.

            ” For purposes of external review, the study benefited from
            the advice and comments of five wind industry and trade association representatives, seven consultants,
            three federal laboratory staff, and one U.S. Government employee.”

          • Bob_Wallace

            Aw, the report reported something you didn’t want to hear. So you piss on it….

          • sethdayal

            Actually as you discovered it had a very helpful chart on the RPS credits, so it wasn’t total loss.

          • Bob_Wallace

            I found an example of a REC figured into a 20 PPA.

            In Canada. BCHydro.

            I’ve found none for the US.

            Oh, the Canada one? $3/MWh. $0.003/kWh.

          • sethdayal

            There are no REC’s in BC Hydro you halfwit. Is there anything you can come up with that isn’t a lie.

    • Bob_Wallace

      “Since wind/solar nearly always has to backed to 100% of name plate capacity by filthy deadly inefficient fossil plant run inefficiently murdering even today tens of thousands of folks with massiv……”

      Well, that’s bullshit.

      When wind and solar are producing filthy deadly inefficient fossil plants are turned off. Don’t you understand how grids work?

      • sethdayal

        Once again Bob you have no clue.

        9 01 PM wind 10 Gw,, 9:02 Front passes through wind 1 GW. Gee what do we do? Answer spool up that 10 GW’s of OCGT gas plant that was idling a way, at wasting Gas at 1 GW. waiting for the front to pass.

        Less gas less GHG’s far less money having 10GW of nukes or CCGT plant carrying the entire load, skipping the wind/OCGT altogether.

        • Bob_Wallace

          What we do is to add storage at the wind farm so that they can sell in firm 15 minute blocks.

          And use gas turbines that go from full off to full speed in 10-15 minutes.
          Do you realize that the fossil fuel grid keeps spinning reserve all the time to deal with changes in supply and demand? And that wind and solar are very much more predictable than an unscheduled thermal plant shutdown?

          • sethdayal

            Yup Bob no offense but you are like my ex who couldn’t change a bike tire to save her life..

            The good ole boys from Big Oil that own all the wind farms don’t care about GHG’s or efficiency or like you dead folks so unless somebody makes them,,and remember they own all the politicians, they are really happy to just keep sellin lotsa gas for backup.

            15 mins is insufficient. You need an hour to get an efficient CCGT plant on line, and another hour of storage to act as a buffer, So two hours of grid level storage then we are talking – ain’t happinen.

            You forget Bob that we are talking here about RES regimes where 20% of average grid energy is wind. Fossil/nuke/hydro backup is set at a levels that cover the loss of the biggest generator on line usually about 8%. With wind providing 200% of grid needs, at times, we got a real dilemma if a front passes through more quickly than forecast.

            Gee solar predictable. So on a sky 50% covered with clouds, we can predict solar averages 50% peak capacity varying from 0 to 100% at random. Translate for you Bob, you need 100% name plate backup.

          • Bob_Wallace

            I said nothing about a CCGT plant. GE’s new turbines designed for work with wind and solar reach full speed in less than 15 minutes. The turbine part of many CCGT plants fire up very rapidly, it’s the thermal portion that takes a few hours (and the thermal portions produce well less than 50% of output).

            Those rare, very high wind events? We curtail. Depending on the grid annual curtailment runs 2% to 4%. Those numbers will drop as we add EVs and storage to the grid. (Except where the limiting factor is transmission.)

            With 50% cloud cover and dispersed solar we get some arrays going off line gradually as other gradually come on line.

            Backup must be available for all generation. When a nuclear reactor suddenly goes off line is scramble to find supply time in the old utility office. At least with wind and solar they get a few hours notice.

          • sethdayal

            Like I said Bob – couldn’t change a bike tire.

            If your literacy levels were higher, you get that the GE turbine you described is a CCGT plant, Lots of CCGT plants can be run in Brayton cycle mode at 30% efficiency, compared to 55% with the steam plant going. Given that these types of plants cost twice as much as OCGT plants, utilities usually try to avoid the expense.

            Yup nobody voluntarily curtails as they get paid for every kwh they produce. Bonneville tried it and the court ruled that they had to pay anyway. In any case we aren’t talking extreme wind, we are talking normal high wind days.

            High school stats would tell you the with a 50% random cloud cover over a large area, the chances that all generators are under or without cloud cover is statistically significant. No grid operator would take the chance so 100% name plant backup must be on line.

            As I shown here several times Bob they must have 100% name plant capacity on line spinning away wasting gas at 10% full load capacity as you never know at when or even if during a period of several hours when the wind or sun will drop off within a few minutes. Non technical types like you are more into poetry and just don’t get it.

            The utility always keeps enough spinning reserve to allow for the loss of a large generator or transmission facility, It’s only with the arrival of 20% RES standards that a large grid has to defend from a 100% loss of grid power from a single albeit distributed source.

          • Bob_Wallace

            It’s very interesting that you think a 50% solar outage is a larger management problem than a 100% nuclear plant outage.

            And it’s interesting that you don’t know that unities report that managing wind and solar is easier than large thermal plants and the cost of integrating their power is almost zero.

            You might want to check out the GE FlexEfficiency 50. Designed to work with wind and solar.

            Got some more insults you want to throw my way?

          • sethdayal

            Ontario has 2.5 GW of wind and will have 1.5 GW of solar next year but its largest Nuke is .7 GW. Given it can lose that 2.5 GW of wind plant in 10 minutes while the worst case nuke outage is .7., I’d say the wind/solar was more problematic – wouldn’t you?

            Gee the Ontario Auditor General disagrees telling citizens that wind cost them $2B last year in dumping costs. Some integration hmm’. Heres a real quote from a real utility for ya.

            AWEA board member E.ON, which operates German transmission grids and also builds wind plants in the US, is succinct:

            “Wind energy is only able to replace traditional power stations to a limited extent. Their dependence on the prevailing wind conditions means that wind power has a limited load factor even when technically available…. Consequently, traditional power stations with capacities equal to 90% of the installed wind power capacity must be permanently online [and burning fuel] in order to guarantee power supply at all times”

            No insults Bob just trying to help you reach your potential.

          • Bob_Wallace

            Not necessarily. With today’s technology they can see that change in wind output coming quite a ways ahead. They might lose all their wind in 10 minutes (unlikely, wind doesn’t abruptly stop, especially over a wide area) but they’ll know it’s going to happen a long time before it does.

            When that nuclear reactor gets a flat tire, well, those things are not predictable. Perhaps the floods and heat wave events are.

            Of course wind by itself is not a reasonable way to replace thermal plants. Only anti-wind people ever make those sorts of suggestions as they build strawmen arguments.

            The US grids will be able to take about a 30% wind/solar penetration without adjustments. Past that point we’ll need more load-shifting, storage and dispatchable generation. We’re a few years from that point.
            You Ontario Auditor General has a poor understanding of how grids work. Those spinning reserves serve all generation, not just wind. And spinning reserve is not the solution we’ll use in the future.

          • sethdayal

            Actually Bob my advice is never buy a sail boat as you are going to kill somebody.

            Fronts can stall, or accelerate at random,, and can only be approximated over periods of hours. Lots of folks at the bottom of Davy Jones locker that went into harms way on a weather report. No utility manager is going to risk being fired gambling on the weather guy.

            We are talking tens of Gigawatts of wind energy, that must be 100% backed up, as my EON quote shows not 1 GW on nuke energy handled by normal spinning reserve.

            Actually the biggest 100% renewable nutballs are guys like Bob. Google “Mark Jacobson”

            So tell me Bob I’ve got a grid that is 10 GW average, 30% wind. It’s nightime we are running at 5 GW load, wind comes up, we now have 12 GW of wind energy. To pass your grade 1 greenie exam, a) what do we do with the extra 7 GW’s.
            b) what sort of plant will we used to continue to provide that 12 GW (we only have 7 GW spare) when the front passes over our wind mills over a 15 minute period.

            It’s you that understands bupkiss Bob,The Auditor General’s report detailed how much it actually cost to handle these wind surplus’s.

          • Bob_Wallace

            Well, let me first observe that you’re morphing into a real ass Seth.

            What do you do with too much wind? Curtail.

            Longer term what do you do if you’re curtailing at a significant level? Shift some load or install some storage.

            The cost of integrating wind? Let’s check in with a grid that does it on a significant level…

            “Very large quantities of wind are being used by several grid operators with virtually no increase in the need for operating reserves,” AWEA Transmission Policy Manager Michael Goggin. “The Midwest System Operator (MISO) has over twelve gigawatts. The Electric Reliability Council of Texas (ERCOT) has over ten gigawatts. Xcel Energy subsidiary Public Service Company of Colorado (PSCo) has had well over 50 percent wind at times.
            Renewables opponents, Goggin recalled, “have said for years that costs would go up and the grid would fall apart. They have been proven wrong.”
            In ERCOT’s calculations for 2011,
            Goggin said, “the total cost for integrating wind came out at about $0.50 per megawatt-hour.” And, he added, without 2011’s anomalies in July and August that accounted for 80 percent percent of all costs, the total costs in 2012 for the necessary balancing reserves and other expenses associated with the integration of large amounts of wind are expected to be even lower.
            “Newer research suggests systems can go to 40 percent renewables with no problem,” Goggin said, “using the very efficient grid operating practicesbeing applied by MISO, ERCOT, the California Independent System Operator (CAISO) and others.”

            “They do very fast interval dispatchof all energy resources,” Goggin continued. “because load is continuously changing, the output of fossil-fired plants is continuously changing, and, of course, wind is continuously changing, too.” The closer system operators are to real-time dispatch, he explained, the more effectively supply and demand can be balanced without the use of reserves.

            “They also have pretty large balancing areas,” Goggin added. “If one wind project is going off, another is probably going on somewhere, providing an overall
            more stableoutput. Larger areas also simply have more resources to accommodate variability. In MISO, wind’s variability is just something in the noise. It is not showing up in their reserve needs.”

            ERCOT’s data is similar, Goggin said. “The areas of the country that have efficient grid operating practices have shown it is possible to integrate very large quantities of wind very reliably at virtually zero incremental cost. The areas of the country that don’t have efficient grid operating practices, namely, much of the West outside California, are seeing increased costs and challenges.”

            Studies show nuclear and large fossil plants actually have “far higher integration costs than renewables,” Goggin said. “Contingency reserves, the super-fast acting energy reserve supply required of grid operators in case a large power plant shuts down unexpectedly, are a major cost. Comparing the incremental cost of wind to those costs that ratepayers have always paid, the wind cost looks even more trivial.”

            The fundamental issues are more or less the same with integrating solar, Goggin, who specializes in wind, said. “Relative to wind, solar has more minute-to-minute variability, which increases the cost. But forecasting the sun is easier because it is clear when the sun will come up and go down and when the peak is, and that reduces the cost. But grid operators who use efficient operating methods are finding it is no more of a challenge or cost than wind.”

            $0.50/MWh is $0.0005/kWh which is about nothing.

          • sethdayal

            Well let me first observe Bob that posting massive cut and pastes that you haven’t read, don’t understand, and come from a well known AWEA shill who has no technical qualifications whatsoever, defines you absolutely as a troll. Several of my examples trashed Groggin’s spew already

            Very few RPS scenario’s allow curtailing without paying for the curtailed wind output. The operator will try to dump the power for anything it can get. This is example why Ontario lost $2B on wind, on wind surplus dumps and Bonneville is dumping wind for free most every bnight on the Columbia grid.

            Given you are illiterate, unable to answer any of the examples or question I have for you, then perhaps you can call a friend at home who can read and is used to ‘splaining things at a kindergarten level, what these eminent professional electrical engineers are showing in this detailed study.

            “It finds that the so-called dispatchable technologies – coal, gas and nuclear – have system costs of less than $3 per MWh, while the system costs for renewables can reach up to $40 per MWh for onshore wind, $45 per MWh for offshore wind and $80 per MWh for solar. The costs for renewables vary depending on the country, technology and penetration levels, with higher system costs for greater penetration of renewables.”

            Google “EE-Levelling_the_playing_field_of_grid_cost-2911128”

          • Bob_Wallace

            Seth, you can got to ERCOT and verify what Groggin reports.

            Frankly, I don’t care whether you believe him or not.

            Now, I can tell you that if you take one more shot at me you will be out of here. You already got your warning.

          • Bob_Wallace

            What! You want to bring the nuclear industry in as a trustworthy source?
            The nuclear industry that ignores the fact that we build a ton of storage in order to incorporate only 20% nuclear?

            The nuclear industry that calculates the service cost of high penetration wind/solar but uses low penetration coal/nuclear in it’s dishonest argument.
            Give me a break….

          • A Real Libertarian

            The nuclear industry that claims $0.15/KWh is cheap?

            The nuclear industry that declares they can deliver $0.03/KWh as long as they don’t have to sign a contract holding them to it?

          • A Real Libertarian

            “Given it can lose that 2.5 GW of wind plant in 10 minutes while the
            worst case nuke outage is .7., I’d say the wind/solar was more
            problematic – wouldn’t you?”

            Actually no.

            Ontario has got ~13 GW operational nuclear capacity, so if that goes down, much bigger shock to the system.

          • Bob_Wallace

            I think he means a single plant, not all reactors at once.

            BTW, I just saw and article bragging about how Bruce was selling power for only 6 cents per kWh. Out of a plant that was paid off long ago.

            New wind farms in the US are selling for 4 cents.

          • A Real Libertarian

            “I think he means a single plant, not all reactors at once.”

            Why would he mean that?

            He’s talking about all wind turbines in Ontario not having any wind. So he must be talking about something just as likely, so all reactors at once would fit the bill.

            He’s not a complete and utter hypocrite, right?

          • Bob_Wallace

            He has a significant problem understanding how stuff works….

          • sethdayal

            You don’t know how to change a tire on a bike Bob. How would you know how anything works.

          • sethdayal

            A north south wind front can cross nearly all Ontario wind generators in minutes. Did you study geography before you left school in grade 1?

          • Bob_Wallace

            And there are weather stations upwind of those wind farms that are monitoring wind conditions and how they are changing.

            Got some more insults to share?

          • sethdayal

            WHo says there are Bob – you just made that all up.,

            In any case so what The utility still has to have the 100% backup in full spinning reserve in anticipation of the event as my EON quote tells us.

            No insult intended Bob. Just corrective action putting the student back on the learning curve.

          • Bob_Wallace

            Seth, to be a teacher you should know your field of instruction. You’ve demonstrated a clear lack of knowledge.

            You really should learn more about wind in order before trying to talk intelligently about it.

          • A Real Libertarian

            Really? Proof please.

            And all nukes will be shut down if Chernobyl 3.0 happens here.

            For proof see Chernobyl 2.0.

          • sethdayal

            Yup a privately run plant sold out by a fascist premier Actually cost of the plant is/was 3 cents a kwh financed by public power. Still its pumping out power at less than half the feed in tariff rate that wind is getting. No REC or production credits in Canada Bob.

            As I’ve shown numerous times Bob but you are too stupid to get it, the actual cost of wind power is around 15 cents a kwh. As your own numbers show they can contract it for 4 cents because they get 10 cents a kwh in subsidy.

          • Bob_Wallace

            Seth, I showed you that there is no 10 cent subsidy for wind.

            The subsidy for wind is 2.3 cents per kWh for the first ten years of production. It just went up from 2.2 cents.

            There’s some small REC action going on around the edges but I find no evidence that it plays a role in 20 year PPAs.

          • sethdayal

            You are obviously illiterate Bob, and unable to read the chart which clearly states the credits are going for in the order of 6 cents a kwh and are as we approach RES limits are going to go for a lot more. Since the Ontario wind feed in tariff is the the same as the combo of wind contracts and RES credits and production subsidies, or the actual cost of US wind farms like Shepherds flat, no further proof is required.

            But make my day, Bob. Provide for the readers one single solitary example unsubbed actual capital + operating cost of a wind farm that amounts to your laughable 4 cents a kwh.

          • Bob_Wallace

            As I posted some time back –

            “Well, in 2012 the highest REC was 6c in Connecticut, Massachusetts, New Hampshire, and Rhode Island
            . Those aren’t exactly states with a lot of wind capacity.

            Elsewhere the number was below 5c.

            Now you are trying to get away with posting misinformation.

            Let me just say Seth that you insulting and misrepresentation is getting a bit tiresome. You need to clean up your act or go away.

            BTW, if you were to look at the history of REC pricing you would discover that prices are plummeting. Wind and solar prices are dropping so low that rather than purchasing certificates utilities are just installing renewables and the REC market it crashing.

            Oh, and maximum LCOE for onshore wind is 9c,
            Quartile 3 6c
            Median 5c
            Quartile 1 4c
            Minimum 3c

            (You do understand that subsidies are not included in LCOE calculations?)


          • sethdayal

            Actually Bob one more time you are proving yourself to be illiterate; The chart shows REC are trending rapidly upward and and as of January last year were a high a 6 cents a kwh. When you can get your friend at home to read the report for you, he will point out that this is in a scenario where because of numerous subsidies there is a plethora of wind energy available.

            Everything you’ve posted so far has been a misrepresentation or an outright prevarication. You have been unable to counter any of my rather simple grid examples

            Now Bob here’s your chance, I’calling you out your bull., Give the readers a single solitary example unsubbed capital cost, operating and finance cost with calculation of the LCOE of onshore wind anywhere in the 1.4 to 9 cent range,.

            To get you off to good start keep in mind that the calculation for Shepherds Fflat comes to 15 cents a kwh and the good folks in the government of Ontario have determined that their feed in tariff needs to be 14 cents a kwh to get folks to invest.

            Our illiterate friend Bob thinks them to be idiots, so lets see an AWEA shill squim..

          • sethdayal

            We’re talking spinning reserve designed to handle the unexpected loss of one nuke/coal/gas plant . Look it up on the IESO.

          • A Real Libertarian

            That is relevant how?

          • sethdayal

            It will tell you the actual spinning reserve. At this minute Ontario Demand is 18,756 MW and Operating Reserve Requirement: is 1418 MW.

          • A Real Libertarian

            And how is “spinning reserve” relevant?

          • sethdayal

            That’s what we are talking about here Bob and I. Obviously you have no clew. Go to bed

          • A Real Libertarian

            No, what you’re claiming is that all wind in Ontario can stop within 10 minutes and that’s more likely then a nuke plant going down.

            And that $2 billion is for all reserve not wind reserve.

          • Bob_Wallace

            Just look at how close the Forecast and Output numbers for wind are. Looks like the forecasters have their stuff together.

  • Peebles Squire

    Wind power is an American success story, one that promotes energy security while continuing to support domestic manufacturing.

    Already, wind power employs more than 80,000 people across multiple sectors, including construction, development, engineering, and operations, working in 550 manufacturing facilities located all over the country.

    Wind turbines are increasingly American-made, too, with domestic content composing approximately 70% of new turbines.

    Securing permanent offsets in carbon dioxide emissions, using virtually no water and producing reliable, affordable power, wind power is a win-win for consumers and the environment.

    Peebles Squire
    American Wind Energy Association

  • The Fulminolo machine, which extracts electricity from thundery clouds by magnetic fusion has been hailed as probably the most exciting invention since time began, free clean energy, more powerful than the Sun.
    Experts say the capturing of lightning was always one of the worlds most horrendous challenges, due to the amount of heat that lightning produces,
    The Feed Coil will eventually span the Globe, possibly starting in Venezuela (Lightning strikes 3 times a second) with extracting points to all major Grids at all major cities around the world,
    Michael Lewendon whose been studying Fulminology for forty years states:
    “This energy has been on this planet from the beginning of time and as of now has never been harnessed” but also said “This could be the end to a lot Wars and fighting for oil etc, which can only be a good thing for the millions that suffer this fate”” Big power Stations will be a thing of the past,the changes to this planet will be endless, Free Clean Energy for all, the future looks bright” he says

    • Bob_Wallace

      If we could only harvest crackpot power….

  • ShaleGasExpert

    How does this fit in with the lets leave all fossil fuels, especially natural gas in the ground school? What does Bill McKibben think abou this.

    • Bob_Wallace

      Coal first, then gas.

      It’s impossible to leave all fossil fuels in the ground. People, in general, will not go along with that. People are going to act for short term gain and give themselves more long term pain. That’s just how human beings roll.

      Our best hope is to keep making renewables cheaper and cheaper so that we switch away from fossil fuels simply to save money.

    • it’s certainly getting there. note this quote: “We estimate renewables slowing the rate of natural gas demand growth from power generation to <0.5 bcf/d through 2020 versus our prior estimate of 1.0-1.2 bcf/d even when taking into account planned coal plant shutdowns and assumed nuclear plant retirements.”

      one big downgrade at a time…

  • Kevin McKinney

    It’s great news. But presumably it doesn’t mean a dramatic drop in emissions, which is what we *really* need.

    • Indeed, we need much more than this… i’m certainly hoping Credit Suisse will have to revise its projections again next year in as positive a way as it did here….

    • Bob_Wallace

      Zach is going to be bringing some very good news about Europe soon.

      (Yes, I am leaning on you….;o)

      • haha, on the top of the list now. 😀 after a side project i have to work on for someone.

  • Bob_Wallace

    “with wind and solar market share more than doubling from 2012 to 2025”

    That’s a very safe prediction.
    In 2012 wind and solar held less than 4% of market share. Wind gained about 1% in 2013. Solar is starting to really heat up. Wind and solar could easily double from 4% in 5 years.

    2025 – 2012 = 13.

    20% in 13 years wouldn’t be an outrageous bet. Just moving at a bit faster rate than in 2013 would do it. Make “more than doubling” something like 5x to 10x and I’ll sign on.

    2025 – I’ll go 10% hydro, 15% nuclear, 25% wind, 10% solar and 10% assorted renewables (tidal, biomass, geothermal). 30% fossil fuels.

    The one thing that could throw that off track would be Homer-ing one of our reactors. That would likely lead to large scale shutdown and put fossil fuels in the 40% range.

    • Bob_Wallace

      “By 2025, Credit Suisse projects that renewables will account for ~12% of US electricity generation.”


      I laugh in their face….

      We’d have to slow the current rate of installation.

      More likely we’re going to see the Arctic Ocean ice free in the next 4-6 years, experience a lot more “weather weirding” and start demanding fossil fuels get shut down.

      And don’t forget, we’re cutting demand which means that every MW of wind or solar grabs a larger market share in a shrinking market.

    • patb2009

      the doubling period for new PV installs appears to be around 18 months.
      That can easily continue. If we see this I think by 2020, Renewables
      will be the dominant energy source.

      • Omega Centauri

        This is the usual “conventional wisdom” we’ve been hearing for years now. Renewables have been growing exponentially, but all the serious people project they will level off at no more than todays rate. This broken record has gotten to be very tiring. We get the same from the various international energy agencies (which were created mainly by and for fossil energy).

        • Bob_Wallace

          “all the serious people project they will level off at no more than todays rate”

          People deserving all the derision that can be administered…

          To think that installation rates will stall when prices are coming down so quickly is simply foolish.

    • jeffhre

      If wind (working from a larger base) continues to grow as it has, it will double in 4 to 6 years. Is doubling solar by 2025 much more than than a rounding error compared to it’s growth in the past year.

      Zach, you may just be right about the need for revisions.

      • Bob_Wallace

        Let me throw in an interesting graph that shows the declining cost and increasing installation rates for wind.

  • KKostek

    Where can I find this Credit Suisse report?

    • i’m not sure… i don’t see it online anywhere.

    • Bob_Wallace

      It’s probably not publicly released. A lot of stuff gets produced behind very expensive pay walls.

      • yeah, definitely not publicly available. but it’s not even clear how/where to get the report. all i can say is that it was passed on to me by a notable in the world of solar who would clearly have subscriptions to these kind of things.

  • JamesWimberley

    Zach: “As renewable energy grows, the technology costs come down. The opposite is true for fossil fuels.”
    I’m not sure what you are trying to say in the second sentence, but it’s wrong to assert that fossil fuel plants get more expensive over time, like nuclear. (Exception: they are forced by regulation to add carbon capture.) What is true is that as mature, slow-growing or contracting technologies, the learning curves are more or less flat, unlike those of renewables.

    It’s also true that renewables have a deadly no-so-secret weapon against fossil generators independently of their respective capital costs. With near-zero marginal costs, they are always at the top of the merit order and so reduce the capacity factor – and earning ability – of all plants with significant fuel costs.

    • Bob_Wallace

      I think we can say that over time the cost of fossil fuel electricity will rise due to fuel cost.

      We’re dealing with a finite source and over time it takes more energy to extract. We burn the easy/cheap stuff first.

      • Steeple

        2018 nat gas futures are trading at $4.50/MMBTU.

        I presume that you are long these or some other proxy for forward gas prices. If not, there’s not much invested in your point of view.

        • Bob_Wallace

          They’ve come down some recently (IIRC). Seems like they were over $5.
          We’ll see what they do once exports pick up a bit.

          • Steeple

            Future LNG exports is knowledge that the market has.

            So if you have a strong view, you should be long. Are you?

          • Bob_Wallace

            I don’t invest in commodities.

            Or individual stocks.

          • Steeple

            I’m long oil stocks but don’t own any nat gas heavy stocks.

            Money where your mouth is and all.

          • Bob_Wallace

            Not much more foolish than trying to outguess the market.

          • A Real Libertarian

            “Not much more foolish than trying to outguess the market.”
            Not really, go long on renewable index-funds.

          • Steeple

            But you’re convinced energy prices are moving up 3% per year and would encourage people to make investments based on that view.

            What’s the difference?

          • Bob_Wallace

            No, that’s a ‘best guess’. The best information we have. It’s the historical record.

            The real issue is people trying to price out a solar system but leaving out the fact that the price of electricity is likely to rise over time.

            Once you realize that inflation has always happened (as long as we have the history of money) the best guess is that it will going forward.

            Then one needs to gen a number. Long term average is about as objective as one can get.

          • Steeple

            Well, the forward curve represents what market participants are willing to buy and sell at based on their informed views, and there is a lot of capital at risk in that market. At it shows the nat gas curve flat for at least 5 years.

            Meanwhile, you have zero capital at risk and a very different point of view. That should give you some pause at the very least.

          • Bob_Wallace

            Of course. When I see that the futures market is pricing gas differently four or so years out I wonder why the price has dropped.

            But when I guesstimate the role of gas I’m not thinking four or so years out but a decade or more.

            I hear two different messages about NG, one reflected by futures prices that all’s swell. That we’ve got plenty of gas, don’t worry, be happy. The other one is a story of wells playing out after a year or so (increased drilling/fracking cost) and a rapidly expanding market (finite supply).

            We’ve got the NG industry singing the don’t worry, be happy message. And the EIA telling us that there’s probably less gas than the industry claims. The industry message would lead to low futures. The other version may be reality and those prices could change quite abruptly.

            Commodity futures are a very high risk investments. I learned that long ago by watching someone invest a few hundred dollars and lose several thousand overnight.

          • Steeple

            Any investment where the payout is over 10 years out is one that won’t get too many people’s attention. It’s well known that investments that don’t have good return profiles in the first 5 years or so typicall turn out to be poor investments, at least in a commercial realm.

            The EIA does typically good work in gathering statistics and presenting them in arrears. They aren’t the best forecasters, and I admit that forecasting is hard.

            The primary deferred sellers of forward natural gas contracts are producers who are hedging their investments. So they are betting millions of $ of their own capital hat the forward price is a fair one. Will it be correct? Probably not. But it’s the best source of knowledge we have because it is based on people analyzing their risks and betting their own capital.

            So anyone ignoring that does it at their peril.

          • A Real Libertarian

            “I’m long oil stocks”

            Have fun losing your shirt!

          • Steeple

            EOG up over 30% this year. XOM up over 10.

            Once again, you bring nothing to the party.

          • Bob_Wallace

            My funds are up 32.33% and 33.52% for 2012. Actually they will be a percent or two higher as I haven’t put the last round of dividends into the database.

            OK, my Euro fund earned only 24.89%. Plus EOY dividends. But I’ve got only small money there, just a few year’s living expenses in the event that the US markets went sour but the European markets didn’t.

          • A Real Libertarian

            And Enron’s up over 100%!.

    • “it’s wrong to assert that fossil fuel plants get more expensive over time”

      Luckily, that’s not what Zachary said:

      “The opposite is true for fossil fuels”

      The fuels get more expensive, not the power plants.

      However, due to ever stricter environmental regulation they have to add a lot of emission controls that drive up cost. I don’t know how that relates to the general trend of ever dropping costs of technology.

    • Sorry, it was poorly worded. I meant to say that the fuel costs go up as fossil fuel use grows.

      • ShaleGasExpert

        That doesn’t seem to be the case in the US the last few years. Lower production costs have meant higher production swamping demand.

        • Bob_Wallace


          The drilling/fracking “gold rush” boom flooded the NG market and knocked prices down. We’ve pretty much used up that surplus and prices have doubled off their low.

          The Bakken formation won’t be a long lasting source. Supply will tighten back down pushing prices back up. And other sources are drying up at the same time.

          Little downward blips on a rising price curve.

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