Carbon Pricing

Published on December 3rd, 2015 | by Guest Contributor

96

Wind & Solar Cheaper Than Fossils & Nuclear Now

December 3rd, 2015 by  

Originally published on Sustainnovate.
By Henry Lindon

Wind energy and solar energy are notably beating out conventional generation modalities (coal, natural gas, nuclear, etc) with regard to production costs and abatement as well, according to a new study from the US investment bank Lazard.

The report notes that, despite recent drops in the cost of natural gas in the US, solar and wind energy are still beating out conventional modalities in most situations — partly owing to the fact that solar and wind energy costs have dropped by 80% and 60% since 2009. Utility-scale solar photovoltaic (PV) costs have actually even fallen by 25% just over the last year, according to the new study.

Here are a few graphs from the report illustrating important points, via RenewEconomy:

Lazard Solar Wind LCOE 1 Lazard Solar Wind LCOE 2

This first two graphs shows what’s happened to wind and solar energy project costs since 2009 (in the US). It should be noted that these numbers don’t include tax credits.

This next one shows how these modalities compare to the conventional ones. Worth noting is that, compared to earlier Lazard studies, the cost of nuclear has actually climbed. As you can see, rooftop solar is also notably higher in the US than in many other places.

And here’s a show of abatement comparisons:

Lazard Solar Wind LCOE 3

Lazard notes: “(This) analysis … suggests that policies designed to promote wind and utility scale solar deployment could be a particularly cost effective way of limiting carbon emissions.”

The reports provides a caveat on renewables though: “Even though alternative energy is increasingly cost-competitive and storage technology holds great promise (see our study on its first storage costs assessment) alternative energy systems alone will not be capable of meeting the baseload generation needs of a developed economy for the foreseeable future. Therefore, the optimal solution for many regions of the world is to use complementary traditional and alternative energy resources in a diversified generation fleet.”


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.

Tags: , , , , , , , ,


About the Author

is many, many people. We publish a number of guest posts from experts in a large variety of fields. This is our contributor account for those special people. :D



  • dhm60

    Lazard still hanging on to the base load theory, I see. Interesting to compare their (and other analysts) views on base load with those of Steve Holliday, CEO of the UK’s National Grid. In Karel Beckman’s EnergyPost piece in September; titled “The idea of large power stations for base load is outdated”. Same world apparently, just very different views of it.
    I believe traditional energy analysts are not factoring in the grid control effects of distributed generation and storage, rapid interconnector switching and the increasingly fast IT controlled response to (possibly – predictable) climatic variations and attendant supply dips. Germany makes the point by generating +26% from renewables whilst achieving a drop in outage times. Texas is a similar story.
    To quote from the article: “What is the future of base load generation (in such a system)? “That’s asking the wrong question”, says Holliday. “The idea of base load power is already outdated.”

  • thinkmorebelieveless

    Where would the other renewables like biomass and hydro show up on the above figures. These are noticeably absent

    • neroden

      There’s very little new hydro construction in the US, perhaps because most of the best sites already have hydro. That’s probably why it’s been omitted from the Lazard analysis. Hydro has pretty great LCOE numbers *if you have a good site*. They’ve been constructing a bunch in Quebec.

      • Bob_Wallace

        US installed hydro capacity was 100 GW in 2007.

        https://en.wikipedia.org/wiki/Hydroelectric_power_in_the_United_States

        10 additional GW could be added by converting existing dams.

        http://www.hydro.org/wp-content/uploads/2010/12/Converting4.pdf

        Oak Ridge National Laboratory (ORNL) has identified more than 65 gigawatts of untapped hydropower potential in US rivers and streams. Run or the river hydro.

        http://nhaap.ornl.gov/nsd

        It’s unlikely that we’d build any new large dams on existing rivers. There’s too much desire to leave some rivers ‘wild’.

        What might happen, that I haven’t seen discussed, is the creation of new holding dams in the California foothills. Built to store winter rain water to replace the snowpack storage which is likely going to disappear. There’s plenty of land and the water could generate power as it was fed out for use. We’ve now got dams that run in series down the mountains, generating power at each successive dam.

      • thinkmorebelieveless

        I believe that there is much more hydro that still could be added, especially at existing dams and sites. Here in New England we have thousands of unused Small and Micro hydro sites…..this was proven, industrial scale hydro. The government agencies and their regulations that suffocate hydro development should be directed to promote hydro, especially Small and Micro hydro instead of regulating it to death.
        Residential and Community Small and Micro hydro cost less ( if you take out the regulatory costs) than the solar and wind alternative. Just Google ” Micro hydro” and see all the equipment offerings and different technologies. If you have the water then hydro should be the preferred option based on cost and capacity factor. Hydro and biomass should have been included in the figures above.

  • Sonofswift

    In an interview with Elon Musk in Germany recently he said that a 5 Km square array of solar panels would produce as much electricity as a nuclear plant of the same size (they usually are much larger). He didn’t mention the cost difference – I assume solar would be much cheaper. This is interesting as there are still vested interests here in Australia pushing for more nuclear plants despite their known problems and even though they use a huge amount of water daily which is hard to come by on this dry continent.

    • Bob_Wallace

      The installed cost of PV Solar was $1.49 Installed Cost/Watt a few months ago and is on its way to $1/watt and likely lower.

      Greentech Media 2nd Qtr 2015 Executive Summary

      The installed price of the Vogtle reactors is currently $8.33/Watt and could go higher if there are further delays/overruns. It’s not likely that further plants could be built that cheaply because Vogtle received some super low interest rate loans due to starting construction during the Great Recession.

      The higher capacity factor of nuclear compared to solar (~90% vs. ~25%) shrinks that price difference some but still leaves solar much cheaper than nuclear.

      To use another comparison, the average unsubsidized selling price of solar in 2014 was about 6.5 cents per kWh. A recent bid for new reactors at North Anna would mean electricity at 19 cents per kWh. That’s a subsidized price for nuclear.

      PV solar is expected to drop to about 2 cents per kWh in sunny parts of the US and around 4 cents per kWh in less sunny parts.

    • A different Adrian

      He probably didn’t mention “cost” because that goes to the heart of this thread i.e. the difference between cost and value. Lazards did the same neat manoeuvre by pointedly mentioning that their analysis doesn’t take account of things like environmental impacts of reliability issues. It’s the same old story: the pricing of fossil-fired generation doesn’t (and in practical terms can’t) accurately account for the deleterious effects of CO2, NOx, SOx, Hg, etc, while the pricing of renewables doesn’t account for the fact that there are rare instances when the wind doesn’t blow and the sun doesn’t shine, so there’ll be insufficient electricity.

      Modern society is predicated on the guaranteed and continuous supply of electricity when we need it. A total loss of supply for a few days is all fine and dandy and nothing much to worry about when you’re just a residential consumer – maybe you can’t watch the TV, or maybe the freezer defrosts – but it’s somewhat more serious when petrol pumps don’t work (or people – including the emergency services – can’t charge their EVs), air traffic control radars fail, the water supply system doesn’t function, sewage systems don’t work, hospitals don’t have power, communications stop (server farms already consume GW and cellphone towers typically have a UPS that’s buffers just a few hours of supply), etc. At the moment wherever people even have a back-up supply, such as air traffic control or hospitals, it’s mostly a reciprocating diesel engine or two with enough fuel for about a day – because naturally for anything longer than that… well, the grid would be back, wouldn’t it? Or they’d just go get some more fuel – except for the fact that the pumps don’t work….

      The consequences of the total loss of the grid are the stuff of nightmares, and it’s why national security organisations around the world worry about national readiness for everything from solar flares to terrorist attacks on the grid.

      So, back to Elon Musk’s comparison; for sure in *cost* terms it would be cheaper to build 2,500 ha of solar (= about 1,500 MW) than a 1,500 MW nuclear plant. (For the moment let’s just assume that the 25 km2 of land the solar plant occupies has no value, which is already going to be a bit of a push for places like Singapore or Hong Kong). But what about in *value* terms? Let’s take an example:

      On 19th Jan 2015 the UK’s 12 GW fleet of wind turbines was putting out a paltry 191 MW, or a capacity factor of 1.6%. The contribution from solar was equally small in the day, and in any case, at latitudes between roughly 50 deg N and 55 deg N there’s not much daylight anyway. So the country was saved, quite literally, by nuclear, gas, coal, hydro and pumped storage all running pretty much to the max. The UK has 4 GW of interconnectors to Ireland, France and Netherlands, but the ridge of high pressure causing low winds over the UK affected the whole of northern Europe, so whatever could be imported wasn’t coming from wind or solar.

      In the above situation a 1,500 MW nuclear plant would have contributed 1,500 MW x 24 h = 36 GWh for a day. But for a solar plant to have contributed the same i.e. for a solar plant to have had the same *value* as the nuclear plant, the solar plant would need 36 GWh of associated storage. At the moment people are dreaming of $100 per kWh for battery storage – but let’s assume that’s already a reality. Thus to get the same value, the solar plant would need $3.6 B of batteries. Solar plus land cost plus batteries suddenly doesn’t look so very different in price from nuclear.

      Furthermore, there are occasions when there will be two consecutive days with no wind or solar, or three days, or four, etc. The risk can be estimated with extreme value theory, but what it comes down to is how much are we willing to pay to ensure that there is *always* a minimum level of power available across the country. Even if we set the threshold for losing the electrical grid for several days at a time at “once per century” there will be plenty of people who think that is still too frequent. By way of comparison, a 2001 FEMA report in USA estimated that the probability of a category 5 hurricane hitting New Orleans was a 1 in 500 year event, which must have seemed something of an underestimate in Aug 2005 when Katrina hit.

      LOCE comparisons are only valid if you ignore the consequences of fossil-fired emissions on the one hand, and the costs of mitigating renewables’ (and here I mean primarily wind and solar) intermittency on the other hand. In other words, pure LOCE comparisons aren’t very illuminating at all.

      • Bob_Wallace

        You are right to the extent that LCOE numbers are just a starting point that one can use to build an overall grid cost.

        Where you are wrong is assuming a nuclear powered grid would be at all affordable compared to a 100% reliable renewable powered grid.

        When you talk about the fact that wind and solar are not 100% of the time producers you fail to mention that is also true for nuclear. Nuclear plants, at best, run 90% of the time and reactors sometimes go offline for months and years. It’s necessary to have something to fill in for nuclear when it isn’t producing just as it’s necessary to have something to fill in for wind and solar when they aren’t producing.

        Let me throw in some numbers.

        Wind Onshore
        $1.64 Installed Cost/Watt
        DOE 2014 Wind Technologies Market Report

        PV Solar
        $1.49 Installed Cost/Watt
        Greentech Media 2nd Qtr 2015 Executive Summary

        CCNG
        $1.09 Installed Cost/Watt
        Open EI DOE Database Median Overnight Cost

        For just over $4 one can install a watt of wind + solar + CCNG and have a 100% reliable grid.

        The current installed price for the Vogtle reactors is $8.33/watt. Add $1.09 for a watt of CCNG to make that grid 100% reliable and now the grid cost is over $9 dollars.

        Plus we can’t build additional reactors for $8/watt. That number is a fluke resulting from Vogtle starting construction during the Great Recession and receiving incredibly low interest rate loans. The recent bid for new reactors at the North Anna site in Virginia prices out about 45% higher than Vogtle.

        And let me throw in one more reason why nuclear is priced out of the picture. The prices I gave for wind and solar are 2014 prices. 2015 prices will be lower. 2016 prices will be lower still. We should see wind and solar prices continue to fall over the coming years, increasing the price gap between renewables and nuclear.

      • neroden

        Lazard is an investment bank. They’re providing information for investors — basically their report is telling you which technologies might be worth investing in, and which ones are total losers (from an investment perspective) because they can’t compete on price.

        Nukes are total losers. Coal is a total loser. Solar thermal appears to be a total losers.

        P.S. Here in the northeast we lose the electrical grid for several days at a time pretty much *every winter*, in whatever the worst storm of the year is, so that doesn’t seem like a problem. This isn’t a problem which we are even trying to solve.

  • ROBwithaB

    I suspect that it will be a lot more efficient to create a viable method of long-term energy storage than to maintain an entire parallel infrastructure of “baseload” (read: fossil or nuclear) plants around the world for the very rare occasions when all renewables are under-producing simultaneously over a very large area.

    The “problem” of “lack of baseload” is in fact a problem of nomenclature, and improper understanding, rather than lack of suitable infrastructure.
    If we frame the problem, instead, as “electricity demand does not always match electricity supply” (which is kinda obvious anyway) we realise that the “problem” has always existed, no matter what the mix of technologies used to produce power.

    So defining the “problem” in terms of “baseload” is (deliberately?) misleading, and likely to lead to inefficient solutions.

    How do we match electricity demand to electricity supply?
    That is a more interesting “problem”, or question that we need to answer. And it is a problem that has multiple solutions, most of which can be implemented simultaneously and work together in an interlinked and flexible way.

    The REAL “problem” is actually THE PEOPLE who are trying try to paint “the problem” in purely binary terms. There is no need (nor logical reason) to define the problem as “baseload” versus “renewables”.
    The latest twist on the argument in favour of non-renewable and polluting power production is embodied within this Lazard report. The fossil fuel industry is now (finally, and reluctantly) prepared to concede the obvious, which is that the costs for renewable energy have fallen (or are soon going to fall) below those for non renewable energy in almost all markets.
    However, the scary monster of “Intermittent Production” (in Capital Letters, and bold italic if they have the chance) is now being paraded in front of us in all its gigantic, frightening inscrutability, as if it is a recently discovered beast threatening to destroy civilisation as we know it, if we dare to embark on the dangerous path towards renewable power.
    Aaaargh! The monster is here!
    It will always be here! It is indestructible!
    It is very large and dangerous and it is impossible to understand or predict its behaviour! Eeeeek. (Everybody screams and runs around in mindless panic.)
    And thus, the argument goes, we NEED to keep old faithful “Baseload” well fed and warm in the corner, awake and snarling. in case the monster comes to the door.

    Well, actually, no.

    The monster can easily be chopped up into a large number of smaller and less-scary pieces, as it turns out.
    And good old “Baseload” is turning out to be a less than ideal “watchdog”, sitting there in the corner, demanding to be fed even when the kids are going hungry. And from time to time snarling unpredictably (and occasionally biting) the people in the house. And never actually being required to protect us from the imaginary monster (and no guarantee that he would even by up for the job if the monster did actually arrive).

    There is no such thing as “renewable energy” in the same sense as there is “fossil fuel energy”. What there is, on the one side, is an existing and very well entrenched system of producing electricity, controlled by a very small number of powerful people, that is rapidly becoming technologically obsolete. Namely fossil and nuclear fuels.

    On the other side, we have EVERYTHING ELSE. All technologies ever invented, and many more yet to be invented, which allow us to produce, manage, distribute, modify, curtail, control, curtail, delay, store, transfer, produce, and consume ALL forms of energy available to us. And all these technologies can work together to yield the most efficient system.

    “Baseload” is a word that describes a LIMITATION of the entrenched system, rather than a benefit.
    Fossil and nuclear fuelled plants can not easily and cheaply modify their output. (Except when they fail or need maintenance. In which case very large chunks of capacity were unavailalbe, sometimes without notice. Requiring lots of standby capacity, just in case.) So we burn a lot of fuel to create a whole lot of electricity that we don’t need, when people don’t want it, just so that we can give them a lot of electricity for the short periods when they do want it.
    That’s a BAD THING, just to be clear. Wasteful, inefficient, expensive.
    And the whole electricity grid as we know it grew up and developed within that inconvenient and constraining paradigm known as “baseload” For more than a century, we have tolerated massive inefficiencies because that’s just the way things worked.

    But now we have multiple tools at our disposal to more accurately match, in real time supply and demand of energy.
    The supply coming from a much wider range of sources, using a broader range of technologies and over a much wider geographical area.
    The demand being much more elastic and responsive, over all time frames.
    With the ability to even out any remaining imbalances using massively distributed storage, of many different types.
    It’s a new (and, in retrospect obvious) way to think about energy. Very flexible, widely distributed, highly responsive, extremely safe. Rapid deployment of generating capacity, with efficient allocation of capital using competitive bidding.
    Huge amounts of very accurate data signals, in real time, used to automatically allocate resources in the most efficient way possible, facilitated by complete transparency of information.
    And without ANY need to continuously keep feeding the beast with fuel.

    It is time to recognise the REAL monster in the room.

    And his name is… (da-daah da DUMB)…. “Baseload”!
    Aaaarrrgh.

    • eveee

      Yes. “The Baseload Power Myth” . Flexible sources like gas turbines and hydro can be combined with variable sources like wind and solar for one. Storage is not the only solution for combining with variable sources. There is no need for inflexible base load sources and there never was. Thats just the way its been done in the past.

      http://cleantechnica.com/2014/08/08/rmi-blows-lid-baseload-power-myth-video/

    • Bob_Wallace

      The 20th Century baseload model worked only because we overbuilt generation, installed storage, and used dispatchable generation to match supply to demand.

      The 21st Century model tosses out the expensive and polluting thermal plants and replaces them with renewable sources, mainly wind and solar. The new grid will work exactly like the old grid did. It will overbuild, meaning that in order to supply demand peaks we’ll build more generation than we need during low demand times. We’ll use storage to time-shift energy just as we did with pump-up storage moving nuclear and coal output from high supply to high demand times. And we’ll use dispatchable generation to fill in any gaps.

      The difference? Electricity will be cheaper. We’ll suffer less from fossil fuel pollution. And we’ll curtail climate change.

      • Frank

        Outlaw electric distribution companies from owning generation. Work out the communications, so a homeowner can get pricing data as easily as a gigawatt plant, and if you need services, like frequency, or voltage regulation, buy it. Let anybody and everybody participate equally.

        • Bob_Wallace

          It’s something that could make the transition faster but it’s unlikely to happen.

          Best hope is that grid owners will be required to open up their wires to other suppliers so that clean energy companies can go head to head with their FF plants.

          • Jenny Sommer

            It’s a strange thing that we in Europe got an open electricity market and the US still allows grid owners to run their own plants.

          • eveee

            We believe in corporate socialism. Privatized profits and socialized losses.

          • Bob_Wallace

            You aren’t out of the woods yet. Look at what fossil fuels have done in Spain and Germany to RE.

          • Epicurus

            American corporations preach competition and free markets but in practice they avoid them like the plague. It’s a lot easier making money with little to no competition, protective regulations and special tax breaks. America is a fraud in so many ways.

          • Frank

            Yeah! Where is the tea party? Maybe some free market Republicans. Open her up, like Bob says. Got a bad taste in my mouth from First Energy trying to regulate me into supporting the Sammis coal plant. Ugh.

          • Epicurus

            Such Republicans do exist.

          • Calamity_Jean

            Yes, there’s the Green Tea Coalition, in Georgia and Florida.

          • Epicurus

            The concept of the privately owned or shareholder owned regulated utility with a guaranteed annual rate of return was a horrible idea. Publicly owned municipal utilities were a better idea, like the one in Austin, as is the deregulated market most of Texas has now.

        • Epicurus

          “Outlaw electric distribution companies from owning generation”

          Texas did that. For years after deregulation, electricity prices were very high, and many pundits declared deregulation a failure. A few years ago, prices started coming down and now we have some of the lowest prices in the country. I have unsuccessfully tried to find an explanation of why prices were so high for so long and why they finally came down. We have an online marketplace for purchasing plans (powertochoose.org), although the quoted prices don’t include the fees (distribution, etc) and taxes.

          • neroden

            Rose because an oligopoly was selling the power. Then dropped when wind power was introduced, which competed with the oligopoly.

          • Epicurus

            That sounds plausible. Do you have a link?

            What a great advertisement for wind.

      • Epicurus

        “Electricity will be cheaper.”

        This is the most important thing the public needs to know. The entire Republican climate denialist war has as its premise that fighting climate change, even if it exists, will “bankrupt the economy.”

        There should be a web site devoted to dispelling this Republican lie. I wish you, Zach and some of the other commenters would create it.

        • Bob_Wallace

          We need a site similar to Skeptical Science’s ‘arguments’ page. I don’t feel qualified to build and run one and I haven’t been successful in talking anyone else into doing the job. I don’t think it would be a money maker like blogs that post new stuff daily. It should probably be fronted by industry groups like AWEA and SEIA.

          • Epicurus

            Did Zach do the coding for this site?

            Building a site and running it are two different things, I think.

            AWEA and SEIA must be crazy for not doing it. Maybe they don’t have the money. How about Public Citizen or the Skeptical Science people themselves?

            Content-wise, I think you could do as good a job as anyone, Bob. BTW, do you have a background in the utility industry? If this is just a hobby for you, the breadth of your knowledge is very impressive.

          • Bob_Wallace

            I’m on overload now. Just moderating and commenting takes hours each day.

  • vensonata

    Hmmm, I never seem to be satisfied with these reports by major information gatherers. The two areas which seem to be out of line are the cost of rooftop pv and the storage report. I am not surprised by the strangely inaccurate numbers of the storage report, there is possibly something radiating out of batteries that affects the math skills of otherwise sane men.
    As to the rooftop PV estimates, they are high by at least 30%. There is no excuse for that. The other thing that Lazard must emphasize is the bottom line cost to the customer. In the case of nuclear vs rooftop solar they are comparing commercial costs of nuclear to final residential costs of rooftop PV. This is senseless. If you produce nuclear at say 9 cents kwh (probably not possible) then how much does John Q. Public pay at his meter? 15 cents? And how much does the Texan with a rooftop array just installed for $3 watt without subsidy actually pay for his electricity? It will be less than 15 cents kwh.

    • Epicurus

      “As to the rooftop PV estimates, they are high by at least 30%”

      Link? Thanks. Soft costs remain a problem, don’t they?

      • vensonata

        The links are all in my neuronal circuits. How many reports have I read of national PV averages being $3.30 in 2015. And of course I chose Texas as an example, since they can get installations at less than $3 watt. Now you do have the $5 and up solar city lease installations skewing the picture upwards. That should be filtered out as an aberration. And we know that present unsubsidized fully installed Australian prices are $1.50 US. And the wages for installers in Australia are higher than the U.S. So yes “soft costs” are the culprit. I suspect they are more or less a form of insidious bureaucratic “corruption” which is endemic in the U.S. It is not overt corruption as in Asia or certain areas of Europe and Russia, it is subtler and perhaps more hideous because of that. Like a healthy looking girlfriend with VD.

        • Karl the brewer

          And today’s ‘simile of the day’ is – “Corruption is…..like a healthy looking girlfriend with VD.”

          • Epicurus

            Yes, that is a gem.

          • vensonata

            I actually had an (ahem) friend with a girlfriend like that. And wouldn’t you know it she was going to MIT at the time.

          • Epicurus

            Funny, same thing happened to my friend.

            Things like to grow in warm moist places unfortunately.

          • Karl the brewer

            Does that mean that MIT is a hot-bed of promiscuity then?

          • Steve N

            I’m using that one. Soon.

        • Epicurus

          “insidious bureaucratic ‘corruption’ which is endemic in the U.S.”

          Right, like the cost of the permits and inspections which vary like crazy just in N. Texas. From what I have read, local governments in other countries don’t require what our local governments do. N. Richland Hills required hearings (!) to install rooftop solar until the ordinance was overturned by citizen referendum a few months ago. There was basically one guy–the zoning commissioner–who held up installations in the whole town because he thought rooftop solar was too ugly for their neighborhoods. One man who controlled development based on his personal whims. How Soviet Union.

          I often wonder why people want to come to the U.S. Is it because the U.S. doesn’t appear to be corrupt like the countries they are fleeing?

          • vensonata

            There are a number of examples similar to solar. Ford supported municipal politicians in the thirties advocating ripping up street car lines for better car access. Notice they didn’t just try it out and leave the rails in….they made sure there was no way back. And building codes which do not require insulation formulated in the 40’s. Now wouldn’t GE love that. All that delicious electric energy to heat your house with the hollow walls. Notice these kind of things are baked into codes and by-laws. Who needs to slip somebody an envelope under the table when you can just build fat right into the system. It is all hidden in plain sight.

          • eveee

            Good point. Codes is where we need to start moving. We have examples in many areas, not just buildings. In cars, we still have laws mandating silly mirrors. Now we have ones mandating backup cameras. But keeping the useless mirrors!

            We need to make uniform codes that remove local, city, and state roadblocks to progress in solar installations.

          • neroden

            The mirrors are very useful if the electronics fail. Same reason they used to require fully mechanical chain-driven handbrakes (and I’m really surprised they don’t require them any more).

          • eveee

            Yes. Why not make the mirrors foldable so they don’t interfere with aerodynamics unless they are needed in an emergency. That should make everyone happy.

          • Epicurus

            “Notice these kind of things are baked into codes and by-laws.”

            Thus ALEC.

          • Martin

            But that is not the only place there stuff like that happens.
            I and other people have been dealing that that for years around here, never mind what the regulations are you have to do what the person in charge thinks should be done!
            BC, Canada

          • Epicurus

            Local bureaucrats are the worst because no one checks their power. People who have a psychological need to lord it over other people are drawn to these positions. They seem to exist in all societies.

    • Bob_Wallace

      Nuclear does not seem possible for less than 13 cents. That’s based on the current cost of the new Vogtle reactors and Citigroup states that it will not be possible to build more reactors that cheaply. Vogtle enjoys some very low financing rates due to their start of construction during the Great Recession when money was available at close to zero percentage rates.

      North Anna recently received bids for two new reactors. Prices out at 19 cents per kWh. That’s the low bid.

      I want to know more about their storage numbers. My understanding is that PuHS is less than 10 cents. I think the DOE said 5c/kWh and the Swiss said something similar.

      • Frank

        I’m guessing that doesn’t include storing spent fuel, cleaning up site, or insuring against any unforseen problems, right? But hey, if you can force it onto ratepayers, who cares, right? Ain’t being a regulated monopoly peachy?

        • Bob_Wallace

          Generally decommissioning costs are built into the price structure. Long term storage costs will likely fall back on taxpayers as we have no long term storage solutions and are likely to have recurring costs over thousands of years as we replace aged out storage casks with new ones.
          Insuring against future disasters is almost all on the backs of taxpayers. The nuclear industry is required to make only a token payment.

          As for being forced onto ratepayers, customers in South Carolina have already seen their electricity rate increased six times with the extra money being used to help pay for reactors which won’t be online for years. And then their rates should go up further. They’re already up 30% thanks to the being built reactors.

          Boy, are people going to be pissed when they realize that had the money been spent on wind and solar their rates would be going down rather than up.

          • eveee

            Uranium mining reclamation is paid for by all of us through the US EPA. Billions.

          • Epicurus

            American capitalism: socialize the costs, privatize the profits.

            Thanks for this example.

          • neroden

            http://www.abandonedmines.gov/wbd_um.html

            About $2.3 billion just for the abandoned mines used for *military* mining.

          • Epicurus

            “Boy, are people going to be pissed when they realize that had the money been spent on wind and solar their rates would be going down rather than up.”

            Will anyone tell them? The local media? Their politicians? I’m guessing no.

          • Bob_Wallace

            I suspect people who live in Georgia and South Carolina are already looking around and noticing that they have the some of the highest priced electricity of all the SE states. $0.1210 and $0.1276 per kWh. Alabama is the only other SE state to break 12 cents at $0.1231.

            Windy Texas has seen their electricity prices decrease.

          • Epicurus

            An aside: electricity rates were as high or higher than $.12/kWh for a long time after deregulation in Texas. Now, finally, they are half that. Can’t find an explanation why but I suspect wind has played a part. Maybe a big part. Who knows?

        • neroden

          It doesn’t include *any* of the cleanup costs. There’s a decommissioning reserve fund, but they are ALWAYS too small. Much much much too small. Doesn’t include waste or spent fuel disposal. Insurance is only for really small accidents, the federal government absolves them of liability for Chernobyl-scale stuff.

          Nuclear is *massively* subsidized and they *still* can’t compete economically.

      • vensonata

        Yes, you see many of the numbers in the Lazard report are suspect. I confined my remarks to rooftop solar, but the storage numbers for residential made me feel like I simply did not understand what the graph was saying. They seemed to indicate residential battery storage cost for lead acid and lithium were about $1 kwh!!!. Jumpin Jeez, that is so far off there is no point in talking about it.

        • Bob_Wallace

          I’ve got to dig into the report. I won’t have time for another week or so.

  • Epicurus

    So the transition to utility scale wind and solar won’t raise anyone’s bills now, contrary to what the Republicans keep saying? Will we hear that on CNN?

    When can we expect utilities to start building wind and solar farms like crazy all over the country, replacing fossil fuel plants?

    • sault

      “Will we hear that on CNN?”

      Nope, that would destroy the precious yet unattainable “objectivity” CNN likes to think is the bestest thing evar. Too bad reality doesn’t care where the middle point between two political parties lies.

      “When can we expect utilities to start building wind and solar farms like crazy all over the country, replacing fossil fuel plants?”

      They’re doing it right now:

      http://www.solarplan.org/images/SolarChart.jpg

      New Coal is basically done and natural gas plant additions are only viable until the fracking boom goes bust (or maybe even when the industry finally gets adequately regulated).

      Agree on the external costs, but convincing people that coal, oil refining and the guzzler they drive all cause hundreds of billions of dollars in damage from pollution is a tall order. I’ve shown some of my “conservative” friends the studies by Epstein et al (2011) and Nordhaus showing the massive costs of just coal power and they dismissed them out of hand without even trying to prove them wrong.

      • Epicurus

        Thanks for this chart.

        “reality doesn’t care where the middle point between two political parties lies.”

        That seems to be the standard of American journalism now, and it’s why mainstream American media is worthless. I read The Guardian online when I want to learn something. I have heard Aljazeera is good too but my cable company refuses to carry it.

        It’s paradoxical: we don’t have state run media but we are almost as sheltered from the truth as people who do. The difference? Our government doesn’t censor our internet access.

    • Frank

      Well one problem in my neck of the woods(Ohio) is that the electric distribution companies are allowed to own generation, and mine does, so guess who’s juice the parent company wants them to sell? It’s called a conflict of interest. We should outlaw it.

      • Epicurus

        Texas transitioned from the same system to a deregulated market. Ohio can too. BTW, it was a disaster for years–prices were sky high. In the last few years, prices have fallen a lot and now we have some of the cheapest rates in the nation. Can’t find an explanation for it all.

        • Bob_Wallace

          Wind.

          And the next thing that will shake up ERCOT is solar and offshore wind.

        • neroden

          “Deregulation” is a total misnomer. When you’re separating generation and distribution, it’s possible to screw up completely and end up with a manipulated market run by an oligopoly. That’s what happened in California (they were manipulated by Enron), and initially in Texas. New York separated generation and distribution the *right* way — it involves a lot of regulation!

          • Epicurus

            Efficient markets require regulation. The wingnuts can’t understand that.

          • Bob_Wallace

            Wingnuts don’t do nuance.

  • Ivor O’Connor

    alternative energy systems alone will not be capable of meeting the baseload generation needs of a developed economy for the foreseeable future.

    That’s a fairly bad conclusion. As alternative energy systems grow and the minimal amount of energy produced increases beyond 100% we won’t need storage but instead use a smart grid. A grid that can apply the excess energy into things like water desalination plants. The report though gets caught up on storage and doesn’t see the big picture.

    • Frank

      I think the whole concept of baseload is something that people who own 40+ year old plants like to talk about as if somehow their inability to follow load were somehow an asset. That said, I live in the US, and I think it’s irrelevant till the amount of wind and solar capacity quadruple. Not to say people shouldn’t be looking ahead, but not in the “need to figure out how to handle this before we proceed” kind of way.

      • Karl the brewer

        I also think the term ‘baseload’ is bandied about by those who really, really don’t know what they are on about.

        • Bob_Wallace

          The word seemed to come into higher use a couple of years back when the FF and nuclear industries recognized that REs were going to create big problems for them.

          Over time the thermal industries have floated a lot of concepts such as baseload and energy density in an attempt to argue for their continued existence. You can smell the flop sweat….

          • Karl the brewer

            Up until a few months ago i would have put myself into the ‘don’t know’ camp. Having spent a lot of time reading and researching it was still quite difficult to cut through the deliberate fog of disinformation. And then i read an article on here in which Steve Holliday of National Grid states that baseload is outdated – http://www.nextgenexpo.co.uk/page.cfm/action=press/libID=1/libEntryID=76/listID=2. Suddenly the case for baseload vanishes in a puff of smoke.

            To paraphrase Stanley Kubrick….I have now learned to stop worrying and love distributed energy 🙂

        • Calamity_Jean

          So true! I ran into a idjit on another website a week or so ago who was yammering about “dispatchable baseload”, which is of course a contradiction in terms, like “dry water”. I tried to explain the difference to him/her, but I’m totally not sure s/he got it. Such massive ignorance is positively painful.

          • Bob_Wallace

            They were correct to some extent. Coal and nuclear plants can be turned on and off at the will of the plant operator. That makes them dispatchable in the gross sense of the word. But they take so long to cycle off/on that they aren’t actually useful in the common use sense of dispatchable supply.

            We do turn off coal plants seasonally and I’ve even seen coal plants being turned off and on daily in Canada. France shuts down some of its nuclear plants during parts of the year when demand is down. But these are not ways to deal with short term changes in demand. Gas plants, hydro, storage and curtailing wind/solar are highly dispatchable.

  • Nolan Thiessen

    I’m glad that CT finally covered the new Lazard report. I know LCOE isn’t the whole story, but it is certainly useful. And like Zachary posted, they created the first storage calculation this year as well.

  • Frank

    I am confused by the natural gas reciprocating engine. If that is so much cheaper than a natural gas peaker plant, why did anybody build those peaker plants?

    • someone who knows better can answer, but my guess is that the peaker plants ramp up very quickly, which is needed to fill short-term supply gaps.

      • Jan Veselý

        Gas engines used as generators.

        • Bob_Wallace

          It takes a gas turbine 10 to 15 minutes to reach full speed. I would think a gas engine could get there much faster.

          CCNG plants take a few hours to reach full output. The turbine section is as fast as a standalone gas turbine but the steam portion takes time to build up sufficient heat.

          • Steven F

            jet turbines are frequently used to power navel vessels. They can start the engine and throttle up to fulll power in about 2 minutes.

            A natural gas turbine is nothing more than a jet engine attached to a generator. frequently used in peaker plants have very good load following characteristics but are only about 35% efficient.

            A natural gas ICE however is about 50% efficient (about the same efficiency as a good diesel ICE without the emissions. they are slower to start and there high mass makes them slower to respond to changes in demand.

            Natural gas combined cycle power plants attache gas turbine to a steam turbine. These are quick to start and reach 35% efficiency very quick. However it can take some time to get the steam turbine up temperature and running. But once that is done the efficiency reaches 60%. The increase in efficiency on combined cycle power plant also results in substation power increase

            https://en.wikipedia.org/wiki/Gas_turbine

          • Bob_Wallace

            I wonder if Navy turbines are sped up faster than commercial turbines because there is more of a need for immediacy and less concern about long turbine life?

            Heating stuff quickly can cause stress problems. Maybe the naval turbines are specially built for faster cycling and that would make them more expensive?

          • Ronald Brakels

            Gas turbines are treated very gently from a cold start because if something goes wrong it can destroy itself. But once they are up and running they can respond quickly. If a blade breaks at 50 revolutions a second it can cause a lot of damage. But a reciprocating gas generator is much less suicidally inclined.

            However, reciprocators tend to be more polluting as they may not have spark plugs and so a small amount diesel is sprayed in along with the natural gas to ignite the mix. Their efficiency is also generally lower than gas turbines.

            In South Australia our reciprocating combined cycle natural gas generators were load following, while gas turbines were peak. When gas is cheap, as it used to be, the lower maintenance costs per hour of operation made reciprocators worthwile to use despite lower efficiency. Now that natural gas prices here have risen towards international prices it favours more turbine use over reciprocating generation.

          • Ronald Brakels

            Here is a page about startin’ ’em up with a graph showing the differences in start times: http://www.wartsila.com.au/energy/learning-center/technical-comparisons/combustion-engine-vs-gas-turbine-startup-time

          • Bob_Wallace

            Thanks. Looks like GE now has a turbine that will reach full output in ten minutes from a hot start and 75% load from a cold start in ten minutes. GE produced a new generation of turbines especially for RE use, this seems to be one of them.

            https://powergen.gepower.com/products/heavy-duty-gas-turbines/7e-03-gas-turbine.html

          • Steven F

            Many of the first generation of ship and power plant turbines of were modified jet aircraft engines. An aircraft jet engine on a typical landing gos from idle to fuel power revers in about time it takes the pilot to move the throttle. A typical passenger aircraft does that several times a day.

            A typical navel turbine goes from idle to full power rarely. Most of the time it operates at a cruse setting for days at a time. Gas turbines are not more expensive due to changes related to sea use verses aircraft use. They maybe more expensive due to one extra turbine disk attached to a high RPM crankshaft and transmission. The biggest drawback is the efficiency loss compared to a diesel which means more money spent on fuel and more time spent refueling.

          • Ronald Brakels

            Our recipricating natural gas generators are only about 25% efficient. However, they can be combined with a Heat Recovery Steam Generator to make them combined cycle and greatly improve their efficiency.

          • Steven F

            Reciprocating efficiency is very strongly related to the amount of compression in each cylinder before the fuel is burned. A gasoline engine fuel system modified; to run on natural gas will have a low efficiency. However if you replace the pistons and crank shaft with ones appropriate to high compression (a more expensive modification) would give you diesel like deficiency.

            One key difference between diesel and natural gas is that gas requires a spark ignition. Diesel however is often ignited by compression. So if you want a diesel that runs on natural gas you will find a lot of engines that use a small amount of diesel to ignite the gas. A spark ignited engine however can be simply modified by injecting gas into the air intake.

            Diesel burns more slowly than natural gas. Diesels have been modified for spark ignition but in the few stores I have read about them piston, valve failures were often reported.

            To get the best efficiency and reliability in a Reciprocating engine running on natural gas often involves designing an engine from the the ground up to specifically run on natural gas. That takes a lot more time and money.

          • krypton

            Dual fuelling a diesel engine with natural gas means injecting a measured amount of gas into the air intake. Then diesel is injected in the normal way after compression of the air-gas mixture. The amount of diesel injected is small, the same as a diesel engine when idling. It is enough to light the match, burning the gas. So nearly all the energy comes from the gas, only a few percent from diesel.

            The engine behaves exactly the same as a normal diesel engine, with computer-controlled gas injection. It has to be controlled wisely as it is possible to over-energise the engine, stressing the machine.

            So any diesel engine can be easily converted to dual fuelling by adding a kit, becoming a half way point between a true gas engine with spark ignition and a diesel engine with compression ignition. Both these engines are built strong because they normally work at over 20:1 compression ratio, and therefore a higher efficiency is obtained with all three types.

            Acceleration is as fast as a normal diesel. Starting from cold it would take only a few seconds to reach full power.

            A spark ignition gasoline engine has a lower compression ratio, so a lower efficiency, on petrol, LPG or natural gas.

            There are many suppliers of all types of engines, so there is no need to build one from the ground up.

          • Ronald Brakels

            Thanks for that.

            I checked and our 25% efficient natural gas reciprocating generators are 38 years old and can run off both natural gas and diesel and apparently don’t care which, so it’s pretty clear they’re not state of the art.

          • element

            Im sure this discussion was all sorted out but apparently nobody mentioned the energy density issue. Engines are highly efficient and responsive, but their output is limited. If you require 400MW peaker, you can do that with 2 turbines instead of 40 engines.

    • globi

      The investment costs of a gas peaker plant are definitely lower than of a combined cycle gas power plant (which has lower LCOE than a reciprocating engine).
      The reason why they obtained low LCOE for the peaker plant is probably because they calculated with a low capacity factor.
      (A reciprocating engine is usually faster than a gas turbine – think of a vessel which can adjust power output quickly).

      • Guest

        The Lazard Report indicates that gas reciprocating engines would be distributed generation assets, probably with combined heat and power.

Back to Top ↑