How quickly things change. It was only two years ago, in 2023, that I was writing posts compiling long lists of quotes from climate activists warning that all assets used for production of coal, oil and gas were about to become obsolete and “stranded.” After all, wind and solar were (supposedly) cheaper and cleaner for generating electricity, which could then power anything and everything. Therefore anyone stupid enough to make further investments in producing fossil fuels would lose everything. Here is one such post from June 2023, and another from February 2023.
If you look today, you can still find predictions in 2025 that fossil fuel assets will shortly become “stranded.” (Here is one from Bloomberg from March 6: “Investors Risk $2.3 Trillion of Stranded Fossil Fuel Assets.”). But such predictions are becoming fewer and fewer. Instead, what looks far more likely is that large portions, if not the entire business, of “renewable” electricity generation from wind and sun is likely to get “stranded.”
Consider the latest from the UK. The current Labour government of Keir Starmer, elected just a year ago, is languishing with record-low approval ratings. A YouGov poll in May found Labour with just a 23% “favorability” among the populace, compared to 32% favorability for the Reform Party of Nigel Farage (and 16% favorability for the Conservatives). In other words, if and when the next election is held, Reform could well prevail. Meanwhile, the Reform Party has broken with the former all-party consensus in favor of “net zero,” otherwise known as endless subsidies for wind and solar power.
Two days ago, on July 16, the Deputy Leader of the Reform Party, Richard Tice, wrote to heads of UK renewable energy companies to advise them that a Reform government headed by Nigel Farage would terminate the subsidies for wind and solar energy. Here is a copy of one such letter sent by Tice to Greg Jackson, CEO of Octopus Energy; and here is a July 17 press release from Net Zero Watch publicizing Tice’s initiative. Tice’s letter specifically warns wind developers that if they are granted subsidies in an upcoming round of handouts from the Labour government dubbed “AR7,” a future Reform government will not continue those subsidies:
Let me be clear: if you enter bids in AR7, you do so at your own risk. The political consensus that has sheltered your industry for nearly two decades is fracturing. Reform UK will not be bound by the assumptions or commitments of this failing Labour government.
And from Net Zero Watch’s press release:
Richard Tice is absolutely right to put developers on notice that any new investments will become stranded assets under a Reform government. . . . [T]he real problem with renewables is not political risk but nature itself: the fundamentals of physics and economics, which make wind and solar inherently uneconomic. The industry has been constructed on subsidy, not on market fundamentals. After decades of windfarm handouts, consumers can no longer afford to foot the bill. Politicians can’t override physics or economics – no matter how much they subsidise failure.
The prediction that wind and solar assets will become “stranded” is fundamentally different, and fundamentally sounder, than the comparable prediction for fossil fuel assets. That is because wind and solar generators are entirely a creation of taxpayer subsidies. Without the subsidies they are uneconomic, and they will be worthless the minute the subsidies are withdrawn. In contrast, the fossil fuel assets are economic without government support. The prediction that fossil fuel assets will become “stranded” is based instead on a belief that governments will intentionally destroy these assets in their zeal to stop CO2 emissions. But that means that governments will continue a war on fossil fuels even as it becomes obvious that the alternatives are hugely more expensive, and as consumers are forced to bear the costs of soaring energy prices. My own prognostication is that even the craziest governments will relent in their efforts to destroy the fossil fuel businesses as the costs of doing some become ever more evident.
Back here in the U.S., the Trump administration and Congress have now, via the One Big Beautiful Bill Act, put apparent end dates on subsidies to new wind and solar projects not yet initiated; but they have not threatened to pull subsidies from wind and solar projects that have gotten built based on a commitment of subsidies (particularly tax credits) during the useful lives of the facilities. As such, there would appear to be reason for owners of existing wind and solar facilities to hope that their investments will not become stranded. But it is not a sure thing. There are several ways for the wind and solar investments to fail even if the existing subsidies continue at currently committed levels. For example, wind and solar facilities could turn out to need more maintenance than anticipated to keep going; and if governments will not agree to increase the subsidies at that point, the assets will become stranded. Also, if the end of subsidies for wind and solar developments puts an end to construction of those, then the investments in facilities like factories to make wind turbine blades will become stranded.
Another thing that can and should happen is that the grid operators around the country should restructure the markets by which they acquire electricity from power facility operators to make it such that the grid only buys power that is dispatchable. Such a reform — which is highly desirable — would leave all wind and solar generators stranded.
Back in the oil and gas business, things are booming. Oil and gas production are hitting annual records. The demand for reliable energy only goes up. Anyone who thinks those assets are going to get “stranded” is delusional.
Discover more from Watts Up With That?
Subscribe to get the latest posts sent to your email.
Golly even a caveman knows that any industry running on Subsidies and massive tax breaks as their way to stay afloat will collapse easily once they are withdrawn or expired.
My 27th Law: “What the government giveth, the government can taketh away.”
The government never “giveth” (our tax money), without strings attached.
Less government, means more freedom and less taxes and less rules and regulations, and mandates, and less subsidies, and less penalties
Who the hell do these bureaucrats think we are? Bots to be fleeced?
Fight, fight, fight
“Who the hell do these bureaucrats think we are?”
A resource of wealth, to be extracted to power their own personal empires .
It might not “strand” all solar. Rooftop Solar would still function (until replacement is required) as an off grid source for homeowners (unless those Big Sun Corporations that actually own them decide to remove them or sell them outright to the homeowners on whose properties they are installed) and could still be used by homeowners IF they install Powerwall Batteries to store the energy produced until they need it.
Still expensive for the homeowners though.
Most of Britain is north of 50. Solar is a joke unless you can “store” power from the summer sun.
It certainly is less productive at higher latitudes.
The average electrical usage in the UK is around 10kWHr per day, (2024 data). Let’s assume that in winter the demand is 50% above the average. so 15kWHr.
Also, it’s winter, so useful sunlight hours will be around 4 hours. Also, assume that the sun is mostly behind clouds, so the solar panels, in a northern latitude, will be at best 10% of their rated capacity.
To function, (with a battery of course), the solar panels must bring in at least 15kWHr, use 16 kWHr to allow a little extra for losses, etc.
With only 4 hours of generation, that means that you need 4kW from the panels.
With 10% of their rated capacity only, you’d need 40kW of solar panels, (under full sun).
A typical panel has an efficiency of around 20%, (at 1000W/m2 from the sun), so each m2 would produce 200W. That means that you would need solar panels to cover 200m2.
200m2 is TOO big for a typical house and land but would fit in on a detached house with access to additional roof tops or free-standing panel arrays.
The battery, ideally would have a capacity capable of meeting 5 days of average demand. so 75kWHr of storage would work.
As noted, solar CAN work, 100% for a remote house or one that has access to a lot of sky for mounting the panels. And this is even for a dark winter day, full of cloud.
It will NOT work for everyone. And the price, 4W/pound for solar panels gives a total of around 10k, the battery pack around 7k, electronics/switches/etc another 5k. This totals around 22k pounds, PLUS labour costs, which of course will vary per installation.
So is it worth it….. That’s for the homeowner to determine. How much is power worth to them and it also has a limited lifespan, (10-15 year?).
I have yet to see any sign that it is economical! Therefore, when the ‘energy’ sellers knock on my door, the answer will always be, ‘”Neit’!
Let’s face reality. Say we can travel say 500 km on $50 worth of gasoline. If we could travel the same 500 km on say $10 worth of plug-in electricity…we would probably WANT an electric car in our driveway simply based on personal expenses. So if government is concerned about fossil fuel consumption, and they should be, simply because of the amount of money sent to far-away lands….then the marketing answer is to make electricity very cheap for citizens. The front runner is the type of power generation that was once billed as “too cheap to meter”… nuclear….wind and solar are just too intermittent, with solar PV only viable to match hot sunny afternoon air conditioning loads….so instead of making electricity cheaper, efforts to date have made it more expensive…in fact the result is so glaringly obvious that one has to consider whether government is simply using “green” sloganeering to result in more tax revenue, economic stimulus, or more votes from numpties.
Such a system would still not be reliable as there is no guarantee that all of your assumptions would be met all winter. Periods of bad weather happen. 2x or 5x more redundancy might help.
A diesel generator is really required.
I live off grid, the 10% value for the solar is a really dark day. Equivalent to full cloud with rain.
It doesn’t really get much darker than that. The reality is that the sun provides enough light ,(even on those bad days), to charge the batteries.
The 5 days of storage is NOT for solar not performing, it’s to allow for maintenance on the solar supply side, eg breakdown, or damage.
My system uses similar methods to that noted above, I’ve not used a generator since I upped the number of solar panels. My charge level in the batteries never gets below 85% SOC. In other words, mostly full, all the time.
It can be done, it just costs money. For me the cost of the initial connection set the path I’m on. The connection fees were well in excess of 3x the cost of the off-grid installation, (I’m now in year 15, just changed over the batteries and I’m still well in front). IF you already have an electrical supply connection, then the numbers are not in favour of going off grid just yet. Maybe just one or two more prices rises or battery price falls will see this detail change.
This is a niche application, not a grid scale boondoggle.
It’s still a joke. The energy you get from the “summer sun” will not last you into winter.
BATTERY SYSTEM CAPITAL COSTS, OPERATING COSTS, ENERGY LOSSES, AND AGING
https://www.windtaskforce.org/profiles/blogs/battery-system-capital-costs-losses-and-aging
by Willem Post
.
Utility-scale, battery system pricing usually is not made public, but for this system it was.
Neoen, in western Australia, has just turned on its 219 MW/ 877 MWh Tesla Megapack battery, the largest in western Australia.
Ultimately, it will be a 560 MW/2,240 MWh battery system, $1,100,000,000/2,240,000 kWh = $491/kWh, delivered as AC, late 2024 pricing. Smaller capacity systems will cost much more than $500/kWh
.
Annual Cost of Megapack Battery Systems; 2023 pricing
Assume a system rated 45.3 MW/181.9 MWh, and an all-in turnkey cost of $104.5 million, per Example 2
Amortize bank loan for 50% of $104.5 million at 6.5%/y for 15 years, $5.484 million/y
Pay Owner return of 50% of $104.5 million at 10%/y for 15 years, $6.765 million/y (10% due to high inflation)
Lifetime (Bank + Owner) payments 15 x (5.484 + 6.765) = $183.7 million
Assume battery daily usage for 15 years at 10%, and loss factor = 1/(0.9 *0.9)
Battery lifetime output = 15 y x 365 d/y x 181.9 MWh x 0.1, usage x 1000 kWh/MWh = 99,590,250 kWh to HV grid; 122,950,926 kWh from HV grid; 233,606,676 kWh loss
(Bank + Owner) payments, $183.7 million / 99,590,250 kWh = 184.5 c/kWh
Less 50% subsidies (tax credits, 5-y depreciation, loan interest deduction) is 92.3c/kWh
Subsidies shift costs from project Owners to ratepayers, taxpayers, government debt
At 10% throughput, (Bank + Owner) cost, 92.3 c/kWh
At 40% throughput, (Bank + Owner) cost, 23.1 c/kWh
.
Excluded costs/kWh: 1) O&M; 2) system aging, 1.5%/y, 3) 20% HV grid-to-HV grid loss, 4) grid extension/reinforcement to connect battery systems, 5) downtime of parts of the system, 6) decommissioning in year 15, i.e., disassembly, reprocessing and storing at hazardous waste sites. Excluded costs would add at least 15 c/kWh
COMMENTS ON CALCULATION
Almost all existing battery systems operate at less than 10%, per EIA annual reports i.e., new systems would operate at about 92.4 + 15 = 107.4 c/kWh. They are used to stabilize the grid, i.e., frequency control and counteracting up/down W/S outputs. If 40% throughput, 23.1 + 15 = 38.1 c/kWh.
A 4-h battery system costs 38.1 c/kWh of throughput, if operated at a duty factor of 40%.
That is on top of the cost/kWh of the electricity taken from the HV grid to feed the batteries
Up to 40% could occur by absorbing midday solar peaks and discharging during late-afternoon/early-evening, which occur every day in California and other sunny states. The more solar systems, the greater the peaks.
See URL for Megapacks required for a one-day wind lull in New England
40% throughput is close to Tesla’s recommendation of 60% maximum throughput, i.e., not charge above 80% and not discharge below 20%, to perform 24/7/365 service for 15 y, with normal aging.
Owners of battery systems with fires, likely charged above 80% and discharged below 20% to maximize profits.
Tesla’s recommendation was not heeded by the Owners of the Hornsdale Power Reserve in Australia. They excessively charged/discharged the system. After a few years, they added Megapacks to offset rapid aging of the original system, and added more Megapacks to increase the rating of the expanded system.
http://www.windtaskforce.org/profiles/blogs/the-hornsdale-power-reserve-largest-battery-system-in-australia
Regarding any project, the bank and Owner have to be paid, no matter what. I amortized the bank loan and Owner’s investment
Divide total payments over 15 years by the throughput during 15 years, you get c/kWh, as shown.
There is about a 20% round-trip loss, from HV grid to 1) step-down transformer, 2) front-end power electronics, 3) into battery, 4) out of battery, 5) back-end power electronics, 6) step-up transformer, to HV grid, i.e., you draw about 50 units from the HV grid to deliver about 40 units to the HV grid, because of A-to-Z system losses. That gets worse with aging.
A lot of people do not like these c/kWh numbers, because they have been repeatedly told by self-serving folks, battery Nirvana is just around the corner.
.
NOTE: Battery system turnkey capital costs and electricity storage costs likely will be much higher in 2023 and future years, than in 2021 and earlier years, due to: 1) increased inflation rates, 2) increased interest rates, 3) supply chain disruptions, which delay projects and increase costs, 4) increased energy prices, such as of oil, gas, coal, electricity, etc., 5) increased materials prices, such as of tungsten, cobalt, lithium, copper, manganese, etc., 6) increa
I don’t want to turn my home into a potential inferno by having a Powerwall installed, or by parking an electric vehicle anywhere near it
Both the Batteries (each cell a potential bomb) and the panels themselves tend to Flambé themselves in time. I too would want neither and have neither on my house.
They will become great big ugly monuments to stupidity.
A few large wind turbines should be retained as those monuments- and painted by artists.
In order to make them safe, you need to remove the blades.
I think they have already done that!
Our modern version of the Tower of Babel.
‘Another thing that can and should happen is that the grid operators around the country should restructure the markets by which they acquire electricity from power facility operators to make it such that the grid only buys power that is dispatchable.’
This is key. It is time to dispense with the fiction that dispatchable and intermittent energy are economically equivalent goods that should be priced similarly. In fact, given that intermittent energy sources actually destabilize the grid, they should be looked at as economic ‘bads’, and priced accordingly.
It was self evident that renewables would eventually strand, for at least two reasons. Every time subsidies lapsed in the US, renewable investment went to zero. And, the grid has to provide the intermittent renewable backup, NOT the subsidized renewable investors.
Amen, Rud.
Have you ever paid attention to the screaming and wailing from the renewable industries that occurred when it looked like subsidies were going away? I did. It happened each and every time. It was not pretty.
I would bet that most people saying “fossil fuel assets will be stranded” did so in an attempt to cajole the market towards renewables &/or because they had financial interests in seeing the renewable markets expand. I doubt any of them actually believed fossil fuel assets ever would be stranded.
Yep, another variant of the “energy transition is inevitable” ruse.
It’s not going away any time soon, this just popped up on my Face Book news feed:
“no upfront costs” but maybe lots of long term costs- they didn’t mention the long term
Fraudsters never do! Just like the Medicare ‘Advantage’ sellers! It’s those out-of-pocket expenses they don’t tell you about!
I’ve got a M.A. plan and I like it. I’m retired with a low social insecurity check every month so I can’t afford a “better” plan. But, so far, it’s covered just about everything including hernia surgery in February and most of my pharmaceuticals. I got the cheapest version costing me $0/month.
Wisconsin is in the Snow Belt. What happens to juice output in winter after the snow from the lake effect covers the panels? The Arctic Polar Express from the Great White North often pours mega amounts of snow on to the northern states.
What happens when snow covers the panels? You go from a capacity factor of around 22% in the summer to a capacity factor of less than 8% in the winter. With far more Zero Generation days and just as many Zero Generation Nights.
I’ve wondered about this- I’ve seen some commentators claim solar panels still work until the snow is very deep on the panels. I don’t believe it.
Your disbelief is well founded. Snow will reflect much of the visible light (why snow is white) which are also the photons with the highest energy…
Remember, Installing solar on your roof allows you to claim tax credit subsidy for the complete cost of installing a new roof before installing the solar, because of the twenty year solar guarantee requirement.
People who don’t know this miss out on a lot of free dollars for a new roof. So be sure to factor it in.
Also remember, Rooftop Solar is interconnected to the grid (or you’d never get “Paid by the Utility” for daytime generation) such that it gets automatically Disconnected if your grid source is affected by an outage. Your local tap line Fuse blows deenergizing your transformer and your Solar production gets switched off to prevent back feeding into the fault and reenergizing the utility facilities preventing repairs.
So in the event of an outage, your Solar System becomes useless to you until the utility power side is restored.
If I was to do a battery/solar installation, the set-up would include a disconnect switch between the utility and the house in order to allow the batteries to supply power to the house during a power outage. The other feature of the installation would be directing the solar panel output to the batteries during the day, with the battery powering the house from ~ 2 hours before sunset till ~10PM at night (when rates are highest).
I would also want LFP batteries instead of Li-ion batteries for reduced fire hazard. There is a LFP battery storage being built about 2-3 blocks from where I work, will be interesting to see if LFP is less of a fire hazard than Li-ion.
The only way I ever see this standoff between coal/gas/oil energy proponents and solar/batteries/wind proponents ending is that they reach agreement that NUCLEAR is the only way to resolve all their respective issues.
(Hydro is sidelined from this, because it makes sense to all where it is possible).
I won’t be around to see this happen, but hopefully the kids will.
Or fine the bird choppers for environmental damage.
I think that Reform will put a windfall tax on wind farms.
Add to the above the issues of depreciation and maintenance rendering wind and solar farms unviable far sooner than estimated by promoters. For example, the European experience with wind power is well documented by the Danes.
In a recent short video John Burgess summarizes why wind farms become unviable long before promoters promised. He explains that after about 15 years wind farms are uneconomic to keep going. Also the far more reliable older smaller under 2 MW turbines have a longer life. All based on the work of one professor – Gordon Hughes.who did some brilliant work on wind farm costs some three years ago. For those preferring to read, I provide a transcript lightly edited from closed captions in italics with my bolds, key exhibits and added images.
Post with video and transcript is here:
https://rclutz.com/2024/08/21/the-short-lives-of-wind-turbines/
Offshore wind turbine life is even shorter than onshore. Denmark found that 60% of the turbines failed within 5 years. The modern turbines are now also much bigger and at 8MW deteriorate faster than the older 2MW turbines. After 15 years of life it is likely not to be worth maintaining the offshore wind farm.
Wind turbines and solar estates have never been “assets”
They are a liability and a burden.
Very nice Francis. Wind and solar can not replace fossil fuel and nuclear, everybody knows that. Fire up all fossil fuel and nuclear generators. Build new fossil fuel and nuclear generators. Remove all wind and solar from the grid.
Now, THAT would be logical and sensible! We can’t have that!
If the issue was about carbon emissions and effective alternatives to gas/oil generated power, the whole world would have converted to nuclear over the past few decades, saved a few trillion and had enough power on hand for AI.
The fact that ONLY NOW, as the world is in the midst of a global race to harness AI, is nuclear finally coming online.
Why’s that?!
Because AI data centers are estimated to need more than 10 GW of additional power in 2025 (which is more than the state of Utah) and with exponential growth almost 70 GW by 2027!!
That is the kind of power requiring more green energy sources than the raw materials needed to make them!!
And remember, AI’s been in the works for decades, the global elites and climate doomsayers knew about their power requirements years ago!!
Which reveals the truth, the green energy agenda was never about the climate, it was always about limiting & controlling power supplies. The people of the world aren’t going to willingly join the elites Serf State- they’re going to have to be forced into it. You force people out of homes and privately owned vehicles by pricing them out. The tried and true method for achieving that is to increase demand while simultaneously reducing supplies.
Can you think of a better way to achieve that then the Green Agenda that demands we abandon cheap plentiful oil/gas for costly, inefficient and insufficient green energy alternatives. That we ditch our cheap, plentiful oil/gas powered vehicles for costly EV alternatives. Vehicles that require billions in government subsidies just to produce at a cost of $60-70K per vehicle, that buyers don’t want/can’t afford even when priced at a loss as low as $50K?
Other methods of asset stranding include insufficient grid buildout to accommodate the new capacity, leaving it literally stranded with no market, and also the stranding of grid assets when renewables are not renewed for being uneconomic. It’s not just wind and solar farms that are at risk – the grid investment is gigantic. Another potentially huge stranded asset is a rebuilt local distribution grid that assumes most households will have EVs and heat pumps – only to find that doesn’t become the case.
Anyone who invests in an industry, knowing that it only survives due to massive government subsidies and mandates, has no right to expect government to keep up its support.
If you didn’t know that, then you didn’t do due diligence before investing, so it’s still your problem, not mine.
The Starmer government has already addressed this threat to their power by lowering the voting age to 16, adding lots of pliant and inexperienced voters to the rolls.
If I were Richard Tice I would’ve added that they would be required to remove ALL of their weather dependent energy infrastructure, visible and invisible, (undersea cabling etc) restore land to it’s previous state (remove foundations of windmills etc) and restore/upgrade original grid infrastructure as and when each renewable ‘asset’ becomes unviable AT NO ADDITIONAL COST TO THE CONSUMER. And they can start now.
My own prognostication is that even the craziest governments will relent in their efforts to destroy the fossil fuel businesses as the costs of doing some become ever more evident.
Have you visited the UK recently? It is almost certain that, there, the present government is going to keep on shutting down reliable generation, installing intermittent generation, and doing its best to raise demand, all at the same time.
There is no sign that they will stop unless and until they cause nationwide blackouts. In fact, there is already talk from NESO about demand reduction. That’s for decades hence, but its a straw in the wind, the fact that its in the planning is a first step. The date at which it will be required will come closer very soon.
When it will happen is a bit in the lap of the weather gods, but its very likely that in the next decade on one cold, dark, calm winter evening something will blow up, interconnect will not save the day, and Britain will be in total darkness except for backup generation. It will take over a week to recover. Miliband is such a fanatic, and Starmer such a coward, that even this will not convince the first that his policies are wring or the second that he must fire him.
So this is one government which, on all the evidence, intends to keep on keeping on until it produces multiple nationwide blackouts.
If you think this is overstating it, look at last winter. A few hours away from disaster, and that’s before all the new EVs and heat pumps, before the gas plants reach end of life, and before the nuclear dispatachable goes off-line. Think what would happen if the same scenario were to repeat in 2028 or 2029, with peak demand higher and a lot less reliable generation.
These people are truly crazy. Read NESO on hydrogen. How much hydrogen was that?
Read it.