Guest Post by Willis Eschenbach
In early 2013, the US Energy Information Agency (EIA) released their new figures for the “levelized cost” of new power plants. I just came across them, so I thought I’d pass them on. These are two years more recent than the same EIA cost estimates I discussed in 2011 here. Levelized cost is the average cost of power from a new generating plant over its entire lifetime of service. The use of levelized cost allows us to compare various energy sources on an even basis. Here are the levelized costs of power by fuel source, for plants with construction started now that would enter service in 2018:
Figure 1. The levelized cost of new power plants that would come on line in 2018. They are divided into dispatchable (blue bars, marked “D:”) and non-dispatchable power sources (gray bars, marked “N:”).
Now, there are two kinds of electric power sources. Power sources that you can call on at any time, day or night, are called “dispatchable”. These are shown in blue above, and include nuclear, geothermal, fossil fuel, and the like. They form the backbone of the generation mix.
On the other hand, intermittent power sources are called “non-dispatchable”. They include wind and solar. Hydro is an odd case, because typically, for part of the year it’s dispatchable, but in the dry season it may not be. Since it’s only seasonally dispatchable, I’ve put it with the non-dispatchable sources.
OK, first rule of the grid. You need to have as much dispatchable generation as is required by your most extreme load, and right then. The power grid is a jealous bitch, there’s not an iota of storage. When the demand rises, you have to meet it immediately, not in a half hour, or the system goes down. You need power sources that you can call on at any time.
You can’t depend on solar or wind for that, because it might not be there when you need it, and you get grid brownout or blackout. Non-dispatchable power doesn’t cut it for that purpose.
This means that if your demand goes up, even if you’ve added non-dispatchable power sources like wind or solar to your generation mix, you still need to also add dispatchable power equal to the increased demand.
So there are two options. If the demand goes up, either you have to add more dispatchable power, or you can choose to add both more dispatchable power and more non-dispatchable power. Guess which one is more expensive …
And that, in turn means that the numbers above are deceptive—when demand goes up, as it always does, if you add a hundred megawatts of wind at $0.09 per kWh to the system, you also need to add a hundred megawatts of natural gas or geothermal or nuclear to the system.
As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there, so you’ll have dispatchable power when you need it. Otherwise, the electric power will go out, and you’ll have villagers with torches … and pitchforks …
Finally, I’m not sure I believe the maintenance figures in their report about wind. For solar, they put the price of overhead and maintenance at about one cent per kilowatt-hour. OK, that seems fair enough, there are no moving parts at all, just routine cleaning the dust off the panels.
But then, they say that the overhead and maintenance costs for wind are only one point three cents per kilowatt-hour, just 30% more than solar … sorry, that won’t wash. With wind, you have a multi-tonne complex piece of rapidly rotating machinery, sitting on a monstrous bearing way up on top of a huge pipe, with giant propellors attached to it, hanging out where the strongest winds blow. I’m not believing that the maintenance on that monstrosity will cost only 30% more than dusting photovoltaic panels …
Best to all,
w.
Usual Request: If you disagree with what I or someone else says, please QUOTE THE EXACT WORDS you disagree with. That allows everyone to understand exactly what you are objecting to.
It’s interesting to watch, here in Texas on our own grid (separate from the rest of the country exc for a few DC TIE lines which allow us to stay asynchronous with the rest of the country) the subtle change in AC line frequency using a dual-trace scope compared against a high-stability source of ‘AC’ sinusoids (e.g. an HP8904A Multifunction Synthesizer) … the ‘grid’ can be seen to ‘ebb and flow’ over the course of a few minutes as ERCOT works to keep the system balanced and ‘on frequency’. Things don’t improve with highly-variable ‘wind’ to the mix …
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Oatley says: @ur momisugly February 16, 2014 at 2:34 pm
….Now for the kicker…in 2015 35-50 gigawatts of coal fired capacity is slated to come out of service due to the MATS rule….
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Thanks for that confirmation of what I had already suspected.
The Institute for Energy Research says that the North American Electric Reliability Corporation evaluated four major regulations now being proposed or implemented by the EPA and“estimates that nearly a quarter of our coal-fired capacity could be off-line by 2018 and that as many as 677 coal-fired units (258 gigawatts) would need to be temporarily shut down to install EPA-mandated equipment.[ii] These EPA regulations must be implemented within a 3-year window and the mandated equipment takes about 18 months to install. Because EPA’s three year timeline is so tight and the regulations affect so many units, utility companies are not sure that they can meet the standards and ensure reliability of the electricity system at the same time.”
(wwwDOT)instituteforenergyresearch.org/2012/08/01/generating-companies-are-shuttering-coal-plants-at-record-rates-eia-reports/
It looks like a massive problem just-in-time for the next president and that is a gross understatement especially when 1/3 of the nuclear plants may also be shutting down. About 10% of capacity will be shutdown permanently and 1/2 of the remaining coal plants shutdown for an 18 month retrofit. Coal now supplies ~ 40% of our electric. It looks like the light at the end of the tunnel is an on coming train.
Get your diesel generators and supply tanks now before the rush folks.
Oh and do not forget the EPA has also targeted Wood Stoves. Looks like Holdern and Co. really do want us to die.
Two points. Localized power generation (i.e. natural gas) saves transmission costs and those can be very expensive, depending on where you live. Second, to increase WT efficiency why hasn’t someone desi9gned a horizontal system so all the major moving parts can be at ground level?
Hmmm … shifts that ‘transmission; job over to the ‘pipeline’ network, which may require ‘upgrading’ if sufficient demand for natural gas materializes …
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We simply must to find a way to store up wind power for those moments when we really need it. I’d suggest bottling up Nick Stokes, & then showing him an Eschenbach post, & tell him the spinny thing is a speech-to-text converter when the grid needs a little boost.
A most excellent discussion. I have also spent my entire career in the electric utility industry trying to explain the folly of grid-connected intermittent resources and the games people play with levelized cost forecasts. I am heartened to see how many of my fellow engineers are skeptical of the whole climate change scam.
Can anyone point me to studies that address the net impact of wind-turbines on CO2 emissions when the need to provide fast ramping generation reserves is taken into account? My intuition is that we are better off even from a CO2 perspective building a CCGT, than building windturbines with “back-up” ( as it it euphamistically phrased by greens) from gas turbines which presumably would have to be simple cycle. We knw the economics but can anyone point to the CO2 numbers on this?
Richard
Tom J says: @ur momisugly February 16, 2014 at 4:44 pm
….See, there’s no similarity between a Lotus and a wind turbine. Oh, there is one though; that wind turbine’s got fiberglass blades.
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Dang, if you aren’t right! The Quest for the Monster Wind Turbine Blade – MIT Technology
I thought they would use the same hollow core technology used for aircraft blades. cross section image
Lightrain says: @ur momisugly February 16, 2014 at 5:57 pm
………… Second, to increase WT efficiency why hasn’t someone desi9gned a horizontal system so all the major moving parts can be at ground level?
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I assume WT is wind turbine.
You run small home windmills at least 80ft off the ground because that is where the wind is. Think trees.
len says:
February 16, 2014 at 5:40 am
Thanks Willis …
At what point do we all start installing gas reciprocating engines like some industrial customers (http://www.catpowerplants.com/Default). Maybe that’s not what the regulators wanted, shopping malls with on site thermal generation because of the degraded infrastructure and ‘all in’ cost of this ‘fuel mix’.
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Len – Albertan to Albertan – I live in rural Alberta. In the 50’s and early 60″s we had a “light plant” on the farm which consisted of a building full of batteries and an old “one lung” diesel generator. We ran the milk separator (big advantage over the old hand crank one) and a few other things twice a day then shut it down and used kerosene or naphtha lighting. If prices increase much more, I may be looking at a battery building again (I already have an LP generator). I still have a wood stove with a water reservoir and hot water heating coils. But what will city folks do as the John Kerry’s of the world go around making statements like he made today in Indonesia about Global Warming being the greatest threat to the world today? It justifies the ridiculous expenditures and increases in energy costs in the US, Canada, and other countries while scaring sh– out of the public. Meanwhile, Eastern North America is shovelling up all that Global Warming and England is pumping it.
Where are the leaders?
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PV’s – maybe in the near future, but I look at it every few years and until electricity costs triple or battery technology improves greatly, it doesn’t compete at this latitude and may never be practical in the winter with just a few hours of sun.
Lightrain says:
February 16, 2014 at 5:57 pm
Second, to increase WT efficiency why hasn’t someone desi9gned a horizontal system so all the major moving parts can be at ground level?
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Environment Canada had a very large experimental vertical axis (VA) wind turbine just north of Lumsden, Saskatchewan for years. There are now many VA designs.
http://en.wikipedia.org/wiki/Vertical_axis_wind_turbine
The so-called “grid” (from generation to transmission and into the switching yards) is already ‘smart’; it’s the last leg of ‘distribution’ onward toward ‘the home’ (and business) which is being made ‘smart’*.
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* their term, not mine.
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Richard says: February 16,
Someone that should know for the Energy Collective is All I can find any more. He does have several good links in his report too.
http://theenergycollective.com/willem-post/64492/wind-energy-reduces-co2-emissions-few-percent
There used to be more, a good one by MIT and (I think) the U of Minn. Can not find them on the net any more. they are probably still there but I think the search engines have been climatized.
Non scientific envro greens don’t understand why you can;t just add intermittent generation to the grid.
It’s because you have to keep the grid stable and not oscillating.
Perhaps you have seen pictures of the Verazano bridge in Washington back in the 1930-40s. A little wind started the bridge oscillating and each breathe of wind added to it until the bridge was wildly swaying, Finally a bridge support snapped adding stresses to other supports, which soon failed also, and the bridge came crashing down,
That is exactly what happens on a grid, with power sloshing back and forth until a circuit breaker trips or a transformer blows on a grid transmission wire over loading the others, until there is a cascade of failures, and blackout.
There is no fixed amount of intermittent power a specific grid can handle as each is different.
Power EEs spend lots of time calculating the stability of a specific collection of transmission wires, that we call a grid with different generators adding power to it, at different generating levels. That is all I did for a year of my career. The permutations are large, and you must calculate variable amounts of power being generated at generating stations as equipment comes online, or goes offline for repairs, maintenance etc.
With an intermittant, non dischargeable power generation system, the problems of keeping a specific grid from starting to oscillate and sending or absorbing power on a specific transmission wire and overloading it grows astronomically. Generally 15-20% of intermittent power can be smoothed and stabilized by the other 85% of power being generated; but such is not always the case,
Intermittent non dischargeable power wouldn’t be a bargain if it were 10% of the price of dispatchable generation,
But it isn’t.
Spain, Germany and even and T Boone Pickens discovered that in painful lessons,
Despite this “levelized power propaganda” the intermittant sources cost up to10 times what you actually get from them. And that does not include the costs with beefing up the grid to provide better redundacy. Nameplate capacity, unlike dispatchable generation is a gross fiction. It is usually only a dreamy wish for the eco weenies’ renewable generation sources. in addition to the missing costs for actual generation versus the nameplate fantasies, the costs for grid extensions, real world experience says that 30 year financing cost for a 30 year lifetime are grossly over estimated, The UK has seen an average life of but 8 years for wind.
The reality of that isthe numerous wind farms we see with only a few spinning turbines and lots of non spinning, abandoned, ones which would cost too much to fix, after only about 8 years of operation.
Reality is quite different.
What a shame. You use to be able to get good numbers from the US Energy Information Agency. Looks like CAGW politics have started to affect their numbers. In my opinion these numbers are way off because they are using some very basised assumptions. Too bad.
len says:
February 16, 2014 at 5:40 am
So if you look at my bill which is locked in at 0.08$/kwh with 0.06$/kw
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It’s worse than you think, Len. In Alberta cities you have a choice of electricity suppliers and rate plans. In the rural county where I live, you are locked in to one supplier and a regulated rate that varies with demand from C$0.07 per kWh to over 11 cents plus demand charges, transmission charges and “adjustments” that can bring winter electricity cost to over 18 cents a kWh in spite of the supplier quoting 8 to 10 cents. When you take your bill and divide by the kWh, it is a lot higher than the “published” rate.
Minor correction, it was the Tacoma Narrows bridge: http://en.wikipedia.org/wiki/Tacoma_Narrows_Bridge_%281940%29
All of the costs calculated ignore the environmental costs of the power. Without including the environmental costs all the discussion is meaningless. For example, the lifetime cost per kwh of the fukushima power plant just went off the charts. Averaged over the entire nuclear power production base, one fukushima sized accident every 25 years adds 0.10/kwh to every kwh of nuclear power generated.
Of course, Its true that to maintain environment healthy, and in order to save electricity its must to have a current collector in the generator. And above blog and comment discussion in very informative.
@ur momisugly Norm B –
Yes, that is yet another hidden cost of wind power, and it can also apply to fossil generation being constantly ramped up and down, as well as hydro. It’s like city traffic on a car’s engine, compared to highway driving. Excellent point.
When will they ever learn? Presumably never, since ideologues are incapable of learning from experience.
This report says one thing and one thing only: build more combined-cycle gas turbine power plants. What a coincidence, back in ’81 my first job out of the big U, Project Engineer on the very first one! Congratulations, yes, thank you all very much.
It was a Westinghouse machine, 110 megawatts, Lake Charles LA, shed the last row of blades one day and titanium was raining down from maybe a mile in the air. Pressure sensor let go from some vibration. We all lived through it…
Stas Peterson,
Verezano Narrows bridge goes to New York City. Tacoma Narrows, the famous “Galloping Gertie,” definitive case of the structure’s natural frequency being far too low, in other words not nearly stiff enough.
All Mechanical Engineers know this story…
jai mitchell says:
February 16, 2014 at 8:21 am
The EIA LCOE analysis is flawed.
NREL Estimates of LCOE for installed domestic wind in 2012/2013 BEFORE SUBSIDIES come in at 0.0675, the trend is that LCOE will continue to go down from there.
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Great, that means we can end the subsidies and feed in tariffs for wind power, because it is now less expensive to build wind power than any other form of power.
Only that isn’t happening. Instead governments are subsidizing wind farms and giving them long term price guarantees many, many times more than the average wholesale price. Even if there is no demand for the power they produce, the wind farms still get paid to produce, then someone else needs to be paid to dump the power so the grid doesn’t burn out.
They use a capacity factor of 34% for onshore wind and 25% for solar PV both of which seem high.
I acted as an informal consultant for a financial manager who wanted my opinion of various “clean” technologies. 25% efficiency for silicon PV is correct. I don’t know how the wind capacity factor is derived, so I have no opinion on that.
It may be of interest to do some investigation of the Danish Grid. They have a major maintenance problem with the 6000 odd turbines installed, quite a few for 20+ years. During that time baseload generation (dispatchable) using coal has increased by around 40% to cover the low efficiency wind turbines. Most of the environmentally friendly renewable power generated by the turbines is sold to the eco-friendly people in Norway and Sweden. Apparently the maintenance/overhaul costs of the older turbines will be higher in real terms than the original installation cost, leaving the Danish government with a substantial problem.
AP & Reuters at odds!
13 Feb:San Jose Mercury News: AP: Huge Ivanpah solar power plant, owned by Google and Oakland company, opens as industry booms
by Michael R. Blood/Brian Skoloff:
“The Ivanpah project is a shining example of how America is becoming a world leader in solar energy,” U.S. Energy Secretary Ernest Moniz said in a statement after attending a dedication ceremony at the site. “This project shows that building a clean-energy economy creates jobs, curbs greenhouse gas emissions and fosters American innovation.”…
The $2.2 billion complex of three generating units, owned by NRG Energy, Google and Oakland-based BrightSource Energy, can produce nearly 400 megawatts — enough power for 140,000 homes…
http://www.mercurynews.com/business/ci_25134528/huge-ivanpah-solar-power-plant-opens-industry-booms
13 Feb: Reuters: California solar plant greeted with fanfare, doubts about future
by Rory Carroll/Nichola Groom
One of the world’s largest solar projects, which uses heat from the sun to generate power in California, opened on Thursday but may be the last of its kind in The Golden State…
Though Ivanpah is an engineering marvel, experts doubt more plants like it will be built in California. Other solar technologies are now far cheaper than solar thermal, federal guarantees for renewable energy projects have dried up, and natural gas-fired plants are much cheaper to build…
The Ivanpah plant was partially backed by a $1.6 billion loan guarantee from the U.S. Department of Energy, the same controversial program that supported failed solar panel maker Solyndra…
That means the private sector must fill the gap at a time when building a natural-gas fired power plant costs about $1,000 per megawatt, a fraction of the $5,500 per megawatt that Ivanpah cost…
Ivanpah developer BrightSource Energy Inc has failed to secure a permit for any other solar thermal projects in California in part due to environmental concerns, including fears that the intense heat and energy around its plants would harm or kill desert birds.
Ivanpah is jointly owned by privately-held BrightSource, power plant owner NRG Energy Inc and Google Inc …
Late last year, Oakland-based BrightSource said it would focus increasingly on markets outside the United States and in using its technology for industrial applications like enhanced oil recovery, desalination and augmenting existing fossil fuel power plants…
BrightSource is more than 20 percent owned by French power equipment maker Alstom SA. Other investors include venture capital firms VantagePoint Capital Partners and DBL Investors, Goldman Sachs Inc GS.N, Chevron Technology Ventures and BP Ventures.
http://www.reuters.com/article/2014/02/13/solar-ivanpah-idUSL2N0LI1D420140213
Kerry’s real agenda:
17 Feb: Bloomberg Sangwon Yoon: Kerry Burnishes Green Badge in Asia as Volcano Disrupts Trip
Climate change can also be an economic opportunity, Kerry said, adding that investment in “the global energy market of the future” is expected to reach nearly $17 trillion between now and 2035.
In order to boost investments in the sector, governments must encourage greater innovation in renewable energy technology and check the use of coal and oil as power sources for their immediate energy needs.
Kerry said the world “must look further down the line,” even as he acknowledged the challenges for developing countries such as Indonesia in developing alternate energy sources.
“They have to factor in the cost of survival,” he said. “And if they do, they will find that the cost of pursuing clean energy now is far cheaper than paying for the consequences of climate change later.” …
Kerry, who spent much of his Senate career fighting an unsuccessful battle for climate legislation, may be pressured to approve TransCanada’s Keystone proposal in a turn away from urging governments to do more to address climate change risks…
http://www.bloomberg.com/news/2014-02-16/kerry-burnishes-his-green-badge-in-asia-ahead-of-keystone-call.html