Amazon’s Mighty Wind (Cleantech Talk #38)

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Episode #38 of Cleantech Talk is here! Amazon wind energy in Texas, the Laffer Curve, V2G in Finland, and more. Check it out! And read Matthew’s summary/notes below for extra goodies.

You can listen to this episode and subscribe to Cleantech Talk on iTunes or Soundcloud. You can also listen via the embedded player above or download this episode. Jump into the show notes below for more goodies.

Amazon’s Mighty Wind

Episode 38 of Cleantech Talk kicks off with a discussion of how, while China may be overperforming with its solar panel buildout, those panels are underperforming due to the low air quality there. Which is a polite way of saying that coal-combustion aerosols are reducing solar panels’ electricity harvest — by up to a third! (Dark aerosols, like soot, tend to absorb light; other aerosols such as sulfates and nitrates, reflect light. In both cases, the aerosols prevent light from reaching solar panels below.)

There’s a Laffer Curve at play here, Laffer Curve being a wonkish way of describing the Goldilocks principle that the ideal porridge is between the two extremes of hot and cold. A fellow named Arthur Laffer once pointed out that if a government wanted to maximize revenue, it shouldn’t set the tax rates too high or too low. To his everlasting credit, he pointed out that others had the idea before him, but the name “Laffer Curve” has stuck.

Laffer Curve by Vanessaezekowitz at English Wikipedia, CC BY 3.0. 

In our context, if an area is already powered by renewables, then deploying vast amounts of solar doesn’t have much positive impact: the air will be clean to begin with. If an area is somewhat polluted, the solar will have a significant impact. But if it’s very polluted, the solar panels won’t produce as much electricity, so their positive impact won’t be as large. There you go — a Laffer Curve in three sentences!

Another solar panel Laffer Curve comes from photovoltaics not being as efficient when it’s super hot (during heatwaves, they’ll produce a bit less electricity than on regular sunny days). When it comes to wind turbines, windier is better when it comes to electricity production — unless it gets extremely windy, at which point wind turbines will be shut down to protect the equipment. Unfortunately, those thought experiments about being able to capture the energy from a hurricane won’t come true; the turbines might be running at 100% capacity before and after the storm pass by, but they’ll turn off when the worst winds arrive.

Finnish Line for V2G

Our second story relates to Virta, a company in Finland, beginning the deployment of V2G (Level 2) charging stations. Technically, this first EV charger complements a local solar array and battery energy storage. So it’s a Level 2 version of the vision Elon Musk offered for Tesla Superchargers awhile ago: chargers with solar and batteries.

CleanTechnica readers probably already know how important V2G (and other measures) will be for electric grids in coming years, as more solar comes online and the Duck Curve becomes more pronounced. Grid operators will need to find a way of creating midday demand for electricity, and electric vehicles (or not-in-use electric buses!) parked at V2G chargers would serve that purpose beautifully.

Well, that future arrived in California this past March. Spring melt meant high water flows from run-of-river hydroelectricity projects, few people needed air conditioning or heating, and solar panels were producing strongly on the sunny-but-not-too-hot days. Even with other power generators pulling back, wholesale electricity prices went negative. So British Columbia dialled down its dams and got paid to take California’s surplus power. If V2G becomes widespread, that should help mitigate the situation by providing some much-needed midday demand.

Oh, and Wikipedia has the compositions of the electric grid for Finland (here) and Sweden (here). Lots of clean, dispatchable hydroelectricity from dams. And while you may have heard that shallow tropical dams can produce enough methane to be as GHG-intensive as coal plants (regrettably true — in these dams, sunlight can promote anaerobic conversion of biomass at the bottom of the dams into methane), Scandinavia’s dams are in the Arctic, so that’s not a problem in their case!

Amazon’s Big Wind Win

Jeff Bezos — apparently now the richest person in the world again — launched Amazon Wind Farm Texas recently, while standing on one of the wind turbines. As discussed in the podcast, a lot of Fortune 100 companies are making renewable energy investments, not just because it’s the right thing to do, and not just because they’ve probably got corporate emissions-reductions targets, but because this reduces their tax rate. And who wouldn’t like to reduce the amount of taxes they owe?

(Well, Jeff Bezos for sure! Bezos told the Wall Street Journal several years ago that he specifically located Amazon outside of California so that he could sell books into California, without having to charge sales taxes. That gave him an important early leg up on Barnes & Noble in a state with a population of 30+ million potential book buyers, because their brick-and-mortar stores would have to pay those sales taxes.)

American wind projects currently qualify for either an Investment Tax Credit or a Production Tax Credit. Companies building projects that began in 2016 can claim 30% of their costs as a tax credit. The credit is only 80% as large for 2017 projects (i.e., 30% x 80% = 24% overall), 60% as large for those in 2018, and 40% for those in 2019. On the production side, you get a tax credit of 2.4 cents/kWh on wind production in 2016, with the same gradual decrease over time.

Because the transaction costs of these arrangements is so high, it’s only the truly biggest (and most reliably profitable) companies that are taking advantage of this setup. One hopes that arrangements are being put in place to allow smaller companies (e.g. Fortune 101–500 companies) to be able to do this as well.

And finally, before we sign off, the US DOE’s EERE (Department of Energy’s Office of Energy Efficiency & Renewable Energy) recently published its 2016 wind technologies report, which shows that some of the newer wind farms being built are getting 50%+ capacity factors. Having been built in Texas, Amazon’s wind farm is probably going to achieve — or at least come respectably close to — that 50% mark. That’s about level with the 52.9% capacity factor coal plants averaged in the US in 2016!

We’ll wrap this week’s show notes with the EERE’s wonderful chart showing that wind farm capacity factors are gradually increasing, and see you again next week! In the meanwhile, if we can persuade you to feel inclined to drop us a review on iTunes, we’d be highly appreciative of that, too! 😄

Wind Farm Capacity Factors Have Increased Over Time (source: DOE EERE)