The Excess Costs Of Weather Dependent Renewables

By Ed Hoskins

This post makes estimates of the likely excess costs over using Gas-firing for electricity generation that have been incurred to date and will continue long-term to support just the current (2017) level of installations of Weather Dependent Renewables in Western economies.

The excess costs show the additional expenditure necessary to produce the same amount of electricity actually generated and contributed to the grid incurred by using Weather Dependent Renewables:  they thus take into account the comparatively low capacity factors achieved and reported for Wind Power and Solar PV.

The table above shows the extent of installations and makes a estimates of the excess costs that have been incurred and that are projected in future to install and provide continuing support for Renewables in Europe (28) and the USA ostensibly to control climate change.  The long-term costs assume that the Renewable installations will continue to be run, serviced or replaced for 60 years, about the service life of a Nuclear plant.   These excess costs do not account for disadvantages of intermittency and non-dispatchablility of Renewables, which make their power contribution less valuable and much less useful to the grid.

Using recent, 2017, updates to the costs estimates for Weather Dependent Renewables  available from the US Energy Information Administration this post makes straightforward estimates of the excess cost differences in capital costs and long-term costs between the Renewables installations in the EU(28) and the USA and using Gas-firing for electricity generation.

Nonetheless it is questionable whether investments in Renewables can have any worthwhile influence on the climate.  If the influence is marginal, these investments will have been made to no useful purpose and to the detriment of the populace of those Western Nations that have chosen to be involved.  These investments have responded to the “Green agenda”,  but it seems that voters in Europe and the USA were never consulted as to their wishes to make such extreme sacrifices from direct taxation, in the extra costs of their utilities and unreliable electricity supplies.  For the populace at large the Green agenda seems to have little traction.

https://www.breitbart.com/big-government/2018/07/22/gallup-poll-no-one-believes-climate-change-is-americas-biggest-problem/

The scale of the surplus expenditures made and committed to date shows the level of financial waste in the name of “Green virtue signalling” with no popular mandate and with no assured justification of benefit.

A Costing Model

The US Energy Information Administration published the table below in 2017.  This recent table reflects the costs reductions that have been achieved for some Renewables installations, particularly the reduction of costs for Solar PV microchip technologies.  However further significant cost reductions are unlikely to be achieved because all the fundamental ancillary support structures, grid connections, DC to AC inverters, etcetera are substantial additional fixed costs that are not susceptible to any further advances in microchip technology.Screen Shot 2018-07-08 at 08.12.20.png

Using data selected from this US EIA data table information is condensed for the three types of Weather Dependent Renewables, Gas-firing and Nuclear generation.

Screen Shot 2018-07-17 at 10.56.57.png

Note:

  • for the sake of these indicative calculations the purchasing power of the US$ and the Euro are considered equivalent.
  • as of 2017 there were no significant installations of Offshore Wind power in the USA.
  • although it is clear that Gas-firing is certainly the cheapest form of power generation available, the results of similar calculations for Nuclear power are included here.
  • a 60 year long-term view is taken to give a direct comparison with the probable operational life of a Nuclear installation.
  • 90% capacity for Gas-firing and Nuclear are assumed, both generation technologies are capable of that level of sustained output.  When their measured capacity in the European context is checked they may well report a significantly lower capacity levels, but this will only be as a result of the mandatory acceptance of Renewable input in accordance with Government dictat.

This post is supported by the following more detailed earlier posts:

https://edmhdotme.wordpress.com/usa-weather-dependent-renewable-energy-to-2016-performance-and-costings/

https://edmhdotme.wordpress.com/eu-weather-dependent-renewable-energy-installations-output-costs-2008-2017/

The US EIA data shows the following comparisons in overnight capital installation costs and 60 year long-term costs per Gigawatt.Screen Shot 2018-07-17 at 11.06.03.png

Even before accounting for the discrepancies in capacity performance of the different generation types there are very significant differences in capital and long-term costs as above.  But the Renewables industry carefully ignores the differentials of capacity performance when promoting its products.  The following graphic shows the reality of cost comparison when accounting for the actual productivity (capacity percentages) of the long-term costs.

So in comparison to Gas-firing in the EU(28) context:

  • at 20.4% capacity Onshore wind  is ~7 times more costly
  • at 31.0% capacity Offshore wind is ~17 times more costly
  • at 11.4% capacity Solar PV is ~14 times more costly and
  • Offshore wind is ~5 times more costly than even nuclear in the long-term.

Screen Shot 2018-07-17 at 11.05.09.pngClearly Gas-firing is substantially cheaper than all forms of Renewables.  However although according the US EIA data the capital costs for Nuclear generation closely matches Offshore wind power, when comparing long-term costs Nuclear overall is extremely competitive even when set against Onshore wind power and the substantial long-term costs of both Offshore wind and Solar PV.

Comparisons

The EU(28) and the USA are the two Western Nation blocks with the most commitment to Weather Dependent Renewables and these calculations provide a useful indication of the gross scale of financial resources that have already been committed to their Green agenda policies.

These values assume only the level of Renewables installations as reported by end 2017 and the continuation of that level of Weather Dependent Renewables installations in future.  These estimated costs will of course escalate further with more Weather Dependent Renewable installations in future.

  • The EU(28) Weather Dependent Renewables installation is about twice the size of the USA
  • the USA Weather Dependent Renewables installation are ~+30% more efficient than the EU(28) as measured by their reported capacity factors
  • The apparent added efficiency of the USA installations is reflected both in capital costs and long-term cost ratios
  • The current total excess expenditures in Europe are +170% larger than the USA
  • The current estimated excess costs in Europe are approaching 2 trillion $€ whereas the excess costs incurred in the USA have only reached 0.7 Trillion $€.
  • all these excess costs are a burden on the population either through subsidy support from direct taxation, favourable taxation treatment by Government or as surcharges on electricity bills.

https://www.americanthinker.com/articles/2018/06/wind_and_solar_require_massive_subsidies.html

The excess cost estimates outlined here do not include and account for:

  • the actual usefulness of the unpredictably intermittent Renewable Energy production as it gets supplied to the grid

https://www.express.co.uk/news/weather/990616/weather-latest-britain-drought-wind-drought-heat-wave-energy-met-office

  • the ancillary support and extensions of the grid to accommodate Renewables often at locations remote from demand
  • the essential maintenance of back-up, (supplied by fossil fuel generation), running inefficiently to accommodate the variable production from  Renewables
  • etcetera.

These simple calculations are not precise.  But they do give a basic under-estimated indication of the true excess costs involved.  

On the other hand, these cost estimates do give a view of the scale and order of magnitude of the expenditures that have been made and are likely to be forward committed to the present installation of Weather Dependent Renewables 60 year long-term.

The values shown here are derived from the US EIA data for overnight capital costs are absolute comparative costs.  They do not take into account any subsidies, advantageous tax treatments, utility surcharges, etcetera, which may give the illusion that Weather Dependent Renewables are approaching cost competitiveness with conventional technologies.  Without their Government mandates, support and subsidies Renewables are not cost competitive.

It is far from clear that the policy makers, who have been committed to and who are promoting Weather Dependent Renewables as a mechanism to control Climate Change, have made any rigorous open-minded cost benefit analyses for these very substantial expenditures.

They just make the unsupported assertion that that:

“Man-made Global Warming is caused by burning fossil fuels and its is bound to be catastrophic”.

That dogma should be questioned as whether the attempt to reduce CO2 emissions by using Weather Dependent Renewable Energy technologies is an effective and a truly worthwhile approach to controlling Man-made climate change, if it were occurring to any significant extent at all.  For example:

  • it is not clear that Weather Dependent Renewables are overall CO2 neutral when viewed from their construction through to scrappage:  do the technologies produce more CO2 to implement than they can ever save in comparison with Gas-fired electricity generation during their service life.
  • nor is it clear that Weather Dependent Renewables are significantly better than energy neutral, (they probably require more energy expended for their construction and support) than they can ever generate in their service life.

Combined the EU(28) and the USA account for about a quarter of there world CO2 emissions as reported by BP.

https://edmhdotme.wordpress.com/global-man-made-co2-emissions-1965-2017-bp-data/

CO2 emissions worldwide are now growing again,  in particular this growth of CO2 emissions is arising from the Developing Countries.  The proportion of CO2 emissions that could be affected by replacing Fossil fuels by Renewables for electricity generation in Western Nations is therefore diminishing and very limited.

https://edmhdotme.wordpress.com/comparison-of-electricity-production-in-six-major-nations/

Thus attempting to control Man-made Climate Change by using Renewables in Western Nations is probably neither feasible nor rational.

Excess Costs In The European Union (28)

The history of the productive performance of Weather Dependent Renewables in the EU(28) at an overall capacity performance of ~19% is shown below.  275GW is about one quarter of the 1000GW+ of EU(28) generation capacity, however the Weather Dependent Renewables output at 53GW is more like 5% of EU demand.

The 2€trillion cost would be sufficient to replace the EU generation 1000GW capacity twice over with Gas-fired generation or it would require about 40€trillion to replace the full European generation capability with Weather Dependent Renewables.

Using the cost model above this gives an excess cost of ~500 €billion  for capital investment and a further long term excess commitment of ~1.900 €billion for maintaining the current level of installations for a 60 year future.

Screen Shot 2018-07-26 at 13.04.27.png
It is clear that the excess costs to those nations using low capacity Solar PV power and expensive but more effective Offshore wind power are substantially higher than elsewhere.

Excess Costs In The USA

The history of the productive performance of Weather Dependent Renewables in the USA at an overall capacity performance of ~24% is shown below.

Using the cost model above this gives an excess cost of ~200 $billion  for capital investment and a further long term excess commitment of ~600 $billion for maintaining the current installation for a 60 year future.

Screen Shot 2018-07-17 at 11.03.59.pngIt is clear that the excess costs to those states using Solar PV power are substantially higher than elsewhere.

Comparison With Fracked Gas-Firing

In the USA the growing use of fracked natural gas has reduced the CO2 produced by electricity generation very significantly.  See:

https://edmhdotme.wordpress.com/global-man-made-co2-emissions-1965-2017-bp-data/

The widespread distribution of available for shale gas plays shows that shale gas exploitation is still in its infancy and its availability is worldwide and for the long-term, as can be seen below.

Screen Shot 2018-07-11 at 06.16.13.png

However it is clear that the very active anti-fracking movements in Europe and in the USA have been successful in holding back the exploitation of this very valuable long-term energy resource in Western Nations.  That sabotage, benefitting Gasprom and Russia will not continue in the face of economic imperatives.

All that those anti-fracking activist organisations are achieving in Europe is the maintenance of the dependence of European nations on the use of Russian gas.  Russia’s support of Green NGO’s has been successful but perhaps a realisation of this subversion is beginning to dawn.  Frankly this subversion by local “useful idiots” is a very good and very cheap business ploy on behalf of Gasprom etc.

https://www.telegraph.co.uk/news/2018/07/11/trump-nato-summit-germany-captive-russia/

In spite of the efforts on behalf of Russia as fracking progressively comes into wider use the costs of gas and other fossil fuels will remain relatively stable.

The ingrained dogma that Man-made CO2 is a pollutant has damaged the use of potentially abundant Natural gas for Electricity generation in much of the Western world.

Were CO2 emissions affecting climate change of real concern, it should be noted that burning gas as opposed to coal for generation producers significantly less CO2 per unit of energy.  This point has been amply demonstrated in the USA where CO2 output per head has fallen significantly in recent years.  The reason for this is simple chemistry:  the proportion of Carbon atoms in gas molecules is very substantially lower than is found in solid fossil fuels.

Conclusions

Screen Shot 2018-07-21 at 07.55.06.png

The extreme scale of the financial commitment to Weather Dependent Renewables is clear above.

But who voted for these costs to be imposed for possibly “saving the Planet” ?

The Weather Dependent Renewables industry has deluded itself, its Green politcal supporters and the public at large by not admitting to detrimental impact of the massive capacity and thus performance cost differentials between Weather Dependent Renewables and reliable fossil fuel or nuclear power generation.

It is often asserted that Weather Dependent Renewables are now competitive with traditional electricity generation technologies, but the Renewables industry conveniently forgets the capacity / load factor differences with traditional generation mean that overall throughout Europe their Renewables only produce about 1/5 – 1/4 of their stated Name Plate values.

The business case for Weather Dependent Renewables cannot be viable without the massive subsidy support and advantageous business environments imposed by Government mandates.

From the point of view of Renewable capacity achievable an assessment their true output performance Weather Dependent Renewables are intricsically much more expensive than consistent and reliable traditional electricity generation technologies, in particular in their cheapest form, Gas-fired Generation.  Beyond the major cost differentials quantified here other costs do not account for the difficulties that arise from the inherent unreliability of using Weather Dependent Renewables in the grid as a National power source.

Overall in the EU, using this cost model and taking into account real reported capacity percentages, Weather Dependent Renewable technologies in Wind and Solar PV in combination are about 8-9 times more costly in overnight capital costs and about 10 times more costly in terms of long-term running costs than using Gas-firing for generation, even when including the cost of fuel.

Certainly Onshore wind power is the least costly Renewable technology.  In spite of its high capacity percentage ~30+% Offshore Wind Power is certainly the least economic overall.  When the significant reduction of the manufacturing costs of the solar panels themselves is taken into account Solar PV is still relatively expensive in comparison to Onshore Wind power and even when compared to Nuclear power long-term.

These cost analyses do not take account of the intrinsic variability of output from Weather Dependent Renewables which make the power they produce much less valuable, much less useful and much more expensive to utilise than dispatchable on-demand power sources such as fossil fuels and nuclear power.  Their poor cost performance is compounded by an additional major disadvantage of unpredictable functional performance.

The UK wind drought in July 2018 and the diurnal nature of Solar PV power is shown below Screen Shot 2018-07-21 at 08.00.08.png

As the installations of Weather Dependent Renewables grow it is now clear that fossil fuel usage must grow alongside, if a reliable electricity supplyis to be maintained.

http://notrickszone.com/2018/04/30/new-papers-intermittent-wind-power-preserves-increases-need-for-fossil-fuel-energy-generation/#sthash.k1KCoIHC.dpbs

https://www.forbes.com/sites/michaelshellenberger/2018/07/26/as-heatwave-tests-the-limits-of-renewables-anti-nuclear-governments-return-to-nuclear/#58b5f8be132b

In Europe according to this version of a cost model, this “virtue signalling” has already cost the populace of Europe about 500 €billion in excess capital expenditures and that extra cost would exceed 2.7 €trillion over a 60 year period.

So one can only conclude that there is little point in installing Renewables at all, save as a massive and very costly exercise in “Green virtue signalling”.

By Government mandate relatively cheap and efficient economic fossils fuel generation is inevitably supplemented by expensive and unreliable Weather Dependent Renewables.  This involves a complete duplication of generation capacity when the costly part of the generation can only contribute to grid for about one fifth – one quarter of the time, and worse still this power production is unrelated and unrelatable to demand.

If these calculations are close to the right ballpark, this post confirms that the pursuit of Weather Dependent Renewables to provide power for any developed economy is essentially a very expensive and truly ineffective fools errand.

To quote the late Professor David Mackay “an appalling delusion“.

Read more at edmhdotme.wordpress.com

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