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Straws in the wind

April 15th, 2010

Serious action to reduce CO2 emissions has been stymied in Australia and the US for the moment. So, to get an idea of what is likely to be feasible, and on what timescale, we have to look at Europe, which has both a working Emissions Trading Scheme and a bunch of special incentives to promote renewable energy. At least on the latter point, there is some cause for optimism.

Here’s a graph of new installed capacity and decommissioned capacity for 2009 from The European Wind Energy Association (link here was broken and is now fixed-JQ). The results pretty much speak for themselves, but I’ll add a couple of observations.

The fact that solar PV was a major source of new installed capacity surprised me. Until now, solar (along with fusion) has been one of the contenders for the tag “the energy source of the future and always will be”. But, on current trends, solar is set to be a major contributor in the future. Of course, the outcome so far has been the result of large subsidies, such as feed-in tariffs. But, even as the subsidies are cut back the volume of installations continues to grow. Before long, solar could be competitive with coal on the basis of the ETS and peak-load pricing, without the need for an extra “renewable” subsidy. Gas is likely to be cheapest for some time to come, but there are sound reasons for not wanting to depend entirely on an energy source that can be cut off at short notice.

The other point is that for coal (and also, less surprisingly for nuclear) installed capacity showed a net decline. The combination of the ETS and strong political opposition has made the construction of new coal-fired power stations in Europe almost impossible, at least without a commitment to CCS or some other sweetener.

On this issue, where Europe has led, the rest of the world will follow sooner or later. The big question is whether it will be too late. The good outcomes we are seeing in Europe suggest that, even with a few years’ slippage, big reductions in emissions will be possible in time to stabilise global climate.

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  1. April 25th, 2010 at 16:46 | #1

    @Ronald Brak

    Fran, we currently we use low capital cost, high fuel cost gas for peak power. Gas is good for peak power because it’s not very expensive to build the capacity you need to meet peak demand

    On the downside though …

    1) the public is at increased risk per unit of output of a gas explosion
    2) the other emissions also aren’t good for human health
    3) The Co2 contributes to GHGs
    4) The resource is limited
    5) Harvesting the resource also has a very substantial footprint per unit of output

    Nuclear power is the opposite of gas. It has high capital costs and low fuel costs.

    That’s true but of course the levelized costs over the full lifecycle of the plant (40-60 years) per unit of output are much lower. And even the high capital cost reflects the first of a kind nature of many plants. Modularisation would sharply cut the costs of safety certification. Similarly, delay associated with minor compliance issues adds greatly to the cost of builds, as does an overly bureaucratic regime for approval.

    A gas turbine can save a lot of money by switching off because its fuel costs are high. A nuclear reactor saves very little money by switching off. A nuclear reactor will cost a power company almost the same amount of money whether is running at full capacity or zero capacity.

    Precisely — which is why the nuclear plant can be pressed into service to supply other kinds of utility such as I outlined above. In addition system redundancy is always needed in a mixed system (fossil, nuclear and whatever)– since plants have to go offline from time to time for scheduled maintenance (and sometimes unscheduled) it makes sense to have the redundancy at near zero carbon and emissions, no?

    Cheap or zero cost electricity could be used for a variety of purposes, but if you push the price of electricity towards zero, how are you going to pay for your reactors?

    This is not a problem since this will only apply during times when output exceeds demand. For most of the time, surplus power will be modest. Moreover, do you not suppose that if power is very cheap that this might encourage energy-intensive industrial activity during such times? Consider Hazelwood for example. The central rationale for this, the dirtiest coal plant in the world, is that it is the cheapest way to underpin aluminium smelting in Victoria. The plant poisons large parts of Morwell and the surrounding area and is licenced until 2035. What do you suppose the consequence of having a very cheap zero emissions power NPP would be? Morwell would be a better place to live and Victorian aluminium would from from being the dirtiest in the world to the cleanest (better even than that from Iceland, since bauxite is mined here)

    And if the goal is to reduce the price of electricity, why not use cheaper wind power to achieve this?

    Because the true cost of windpower does not make it cheaper. Wind can only supply peaking when the wind is blowing or when there’s stored wind, as I noted to you earlier. 1 GW of installed wind at about $US1.6 billion may look cheaper than 1GW of installed nuclear at the current price of about $US2.5 — 3.7 billion, but at 33% CF it is really $US4.8 billion, and it still can’t guarantee that 33% when it is demanded, so you still need something to shadow it. And of course, 1GW of wind can’t be put just anywhere. It would have to be reticulated over a very large area with different wind regimes precisely so that one period of low wind would not becalm the entire system. That implies building massive lengths of HVDC lines at about $US2 million per km, plus grid connections to reconcile frequencies. That’s not cheap.

    Even current solar is cheaper than new nuclear and is much better at matching Australian demand. I’m afraid using nuclear power to meet peak demand does not make sense.

    You actually proved the opposite. You showed that nuclear could supply power at a very low average rate — competitive during the peak and extremely attractive during the off-peak.

  2. Ernestine Gross
    April 25th, 2010 at 18:18 | #2

    “You actually proved the opposite. You showed that nuclear could supply power at a very low average rate — competitive during the peak and extremely attractive during the off-peak.”

    What nonsense. The only ‘proof’ we have on this thread consists of empirical evidence on how the composition of energy sources changed in the EU in the recent past and the data shows a decline in coal and nuclear and a growth in renewables.

  3. April 25th, 2010 at 19:47 | #3

    Barry, I mean Fran, who uses nuclear power to meet peak demand?

  4. Hermit
    April 26th, 2010 at 08:15 | #4

    If grid demand never falls below around 40% or so of peak then at least that amount should be generated by round-the-clock low carbon sources. As Fran points out temporarily excess nuclear output could be used to make storable products like desalinated water or hydrogen. However that scenario is a long way off.

    Our romance with gas is a bit like a lobster eyeing off a fish head instead a cage.. we could find ourselves trapped. As oil declines gas will increasingly be used as a transport fuel and chemical feedstock. LNG export demand will increase long term. The price of gas for both transport and electrical generation will increase so both mobility and electricity will cost more. Also gas will not get us to long term CO2 targets. A coal displacing mix of 80% gas 20% renewables might emit 40% less CO2 than coal, not enough long term.

  5. April 26th, 2010 at 08:59 | #5

    @Hermit

    And on the role of gas in Australian energy supply, this article is interesting:

    Santos chief’s gassy vision Part 1 – Australian natgas reserves

  6. April 26th, 2010 at 09:00 | #6
  7. BilB
    April 26th, 2010 at 09:25 | #7

    Hermit,

    What, Fran, said was ridiculous. Nobody builds a massive piece of infrastructure and has it sitting idle on the off chance that it might be needed to soak up a chunks of surplus electricity. Nuclear does not do peak power, full stop. Nuclear cores need to maintain a stable temperature profile, ramping their output creates thermal stress on the nuclear core materials which shortens the core’s life.

    Gas is what we have had in the past and are replacing at the moment. Wind power, CSP, biomass and biofuels are what are being installed now. The is no Nuclear being built, or planned to be built, in Australia, so this whole nuclear passion play underway here is totally pointless. With most countries scaling back their nuclear machinery, and a new determination to reduce the dangers from the availabilty of nuclear material, the probability of a nuclear rennaisance is neglible. From Australia’s perspective this is such a devisive issue politically that there is zero chance of it being a reality here. Howard gave it a fly and was so thoroughly politically demolished that no party with a determination to maintain government will try it again. And the rapid rise of renewables will dispose of any commercial incentive to reconsider nuclear energy for Australia.

    So get with the programme and re-align your thinking towards Solar, or get one or Fran’s nuclear batteries and install the perimeter fencing and employ the security force that you would need to keep it safe from terrorist hands.

    Once renewables have increased to supply most of our electricity needs gas will only be used level demand fluctuations where there is a short fall. But it is important to realise that there is a huge body of gas which needs to be burnt. Natural gas is methane and visa versa. There are very large amounts of methane reaching the atmosphere where it becomes a global warming accelerator unless it can be capture and burnt to produce energy and CO2. Coal seem gas is one source. So in short burning some gas will always be more beneficial for the environment than not burning it. However, most of the gas being used at present is fully sequestered gas, and this is the worst outcome.

  8. BilB
    April 26th, 2010 at 09:57 | #8

    Fran, it is clear why you are so persistent with this whole nuclear obsession of yours when you keep directing attention to the Brave New Climate web site, where I see a massive amount of falsely presented renewables science floating in an ocean nuclear optimism. Its is the only place that I have seen the nuclear danger symbol graphically altered to be a “happy face”. There is so much deliberately false information there that the site can have no real credibility as other than an interesting read.

  9. April 26th, 2010 at 12:55 | #9

    @BilB

    Nobody builds a massive piece of infrastructure and has it sitting idle on the off chance that it might be needed to soak up a chunks of surplus electricity. Nuclear cores need to maintain a stable temperature profile, ramping their output creates thermal stress on the nuclear core materials which shortens the core’s life.

    This is specious. About 350 metres from where I live, there’s a nice Korean couple who have operated the corner store for 14 of the 19 years I’ve lived here. The store doesn’t open until about 7.30 AM and closes most nights about 7.00PM. On Sundays it operates between 9.00 and 4PM.

    Clearly, the couple have decided that the marginal utility of trading does not warrant being open for most of the week. On the other hand, the marginal utility of opening when they do compensates them enough to meet the entire levelised costs of the business in the periods they do trade. The fact that they have a shop full of goods, (some of them perishable and requiring refrigeration at a cost to them), untradeable for 54% of the week is not decisive.

    Service stations often operate 24 hours a day, but between 9PM and 6AM business is quite poor, so their expensive capital is tied up on the off-chance someone will come in and meet their marginal costs of being open. Having the lights on and the petrol pumps and air compressors ready costs them every minute and a staff member there. Yet they stay open.

    It is the same with nuclear plants. At the point where backing off output is more expensive than selling or dumping output, the plant keeps producing. Like the service station or the Korean corners store, the viability of the plant depends on its ability to generate sufficient revenue overall to meet its recurrent costs. Focusing merely on its off-peak operation is silly. From the POV of the operators, whether these costs are in fuel or wages or reduced life of plant and equipment is irrelevant. Marginal cost is all that matters.

    The more salient question here is not existing demand, but projected demand. Every Australian state capital on the mainland coast is getting desal. Desal and the pumping associated with that is likely to be very CO2-intensive. Doing this desal and pumping during the off-peak makes good cost sense, and with nuclear it would make good CO2 sense as well.

    Perhaps one of the most important things one would want to do is to encourage a very much greater proportion of transport energy to be sourced from the grid rather than in scarce carbon-based liquid fuels. The ability to purchase cheap power during the evening off-peak, when most vehicles are off the road greatly underpins the marginal advantage of plug-in electrical vehicles, both private and public. The thought that you could buy cheap and sell back to the grid during the peak and shoulder strongly suggests that a very substantial proportion of PEVs will be configured for V2G. This in turn reduces the need for system redundancy to cover slews, and in so far as it allows a greater proportion of any surplus power from existing intermittent capacity to be captured and deployed within the system, relieves intermittent renewable source operators of the burden of the costs of overbuild or storage, negating one of the key constraints on the penetration of renewables such as solar and wind. Since we already have some renewables and will doubtless be looking to build more, that nuclear capacity creates a context which makes these (and near zero CO2 transport) more cost effective, viable and cleaner is another advantage of including nuclear in the mix. The big loser here is coal, followed by gas.

    Nuclear power, by negating intermittency problems could be renewables’ most synergistic companion.

    or get one or Fran’s nuclear batteries and install the perimeter fencing and employ the security force that you would need to keep it safe from terrorist hands.

    I’m rapidly coming to the view that mentioning the terrorist threat should be treated as a variant of Godwin’s Law particularly when the mention is based on absolutely no observable data at all. So far, no terrorist has found a way to deploy nuclear material, despite the enormous upside of appearing to be able to do so. Doubtless this is because it is damned hard to manage. The nuclear battery proposal, if it went ahead, would be every bit as hard to exploit as any other plant, if not more so. In Australia, they would probably be part of a more general secure nuclear facility. Terrorists have far simpler means to inflict harm, as attacks in recent years have shown.

    There are very large amounts of methane reaching the atmosphere where it becomes a global warming accelerator unless it can be capture and burnt to produce energy and CO2. Coal seem seam gas is one source.

    This is true, but of course, if one is phasing out coal-combustion for energy, one could seal the vast majority of mines, starting with the most gassy ones. Some coal is required for steel-making of course, but methane need not be used for energy. There are other useful industrial applications.

  10. BilB
    April 26th, 2010 at 13:40 | #10

    Fran,

    “I’m rapidly coming to the view that mentioning the terrorist threat should be treated as a variant of Godwin’s Law particularly when the mention is based on absolutely no observable data at all”

    Obviously you do not have a high enough security clearance to see the data on terrorism. Suffice it to say that the recent nuclear arms reduction discussion (hosted by Barak Obama)was entrirely about this issue.

    If nuclear energy was entirely safe then I would probably still disagree with

    “Nuclear power, by negating intermittency problems could be renewables’ most synergistic companion”

    simply because it is unnecessary, on the one hand, and it would be prematurely consuming human civilisation’s ultimate energy safety factor, on the other. If climate change goes horribly wrong then nuclear energy may be the only ticket out of hell. Precommitting this resource would in all certainty destroy it as a strategic option in the 5 deg C temperature rise scenario.

    The corner store argument? What? That is a lifestyle and commercial choice for those people, and they do it for entirely hidden reasons that you would not appreciate until you wanted to buy or sell such a business. Similarly for 24/7 service stations. No connection whatsoever with energy generation.

    And by the way, an earlier claim you made about total energy consumed, both electricity and fossil fuels, making the suggestion that electricity generation must be ramped up many fold, while the figure was correct?, the conclusion was false. Can you see why? I had to think this through because a partner came up with a similar (possibly from your same source) figure in a meeting.

  11. Ernestine Gross
    April 26th, 2010 at 14:00 | #11

    Ronald Brak :Barry, I mean Fran, who uses nuclear power to meet peak demand?

    Ronald Brak asked a straight question that is amenable to a straight answer. Could we have it, please.

  12. Hermit
    April 26th, 2010 at 14:26 | #12

    My next question is how do we meet peak demand when there is little or no gas left? OK I left out hydro and wood fired electricity but lets assume both the dams and the wood piles are low. If we can take any heed from the fact that the UK has gone from a gas exporter to importer I suggest low gas stocks is a highly plausible future scenario. Say around 2050 when today’s kids will be in their prime.

  13. BilB
    April 26th, 2010 at 14:56 | #13

    Is there no acculation of knowledge going on here for you, Hermit. By 2040, 60% of Australia’s electricity generation will be distributed capacity in PV on 7 million factories and dwellings. Consecutively CSP plants with eutectic storage, buttressed by wind, geothermal hydro and biomass will provide capacity of 60% securing a 20% overlap within the same 30 years. In the domestic dwelling I see natural gas as being principally used for cooking. This structure will also be providing perhaps 30% of the energy required for personal transport.

    I see natural gas as being a transitionary fuel allowing the necessary contingency energy for coal power stations to be shutdown smoothly. A very small amount of gas may be used by hybride CSP, but this could easily be biomass.

    To be clear the PV I am talking about is very different to that which you have on your house. Each installation will be a standard 10Kw+ contiuous output (ie not Kwh) and have a life expectancy matching the dwelling.

    This is my considered opinion of how the energy situation will develop. It was very significant to learn of the Point Paterson CSP installation. The experience here will snowball, I believe. So gas, I believe, will have an eventual declining importance. Declining liquid fossil fuel availability for heavy transport may alter the sequence of events to some small degree from the natural gas point of view.

  14. Alice
    April 26th, 2010 at 15:22 | #14

    @Ernestine Gross
    Ernestine….nice try…you and Bilb… but you know what you will get dont you?…more of the untruncated, misleading, erroneous stats and blatant falshoods…that are clearly arriving on digital conduit from elsewhere. A diatribe of pro nuclear advertising (blatantly false and misleading at that).

  15. Ernestine Gross
    April 26th, 2010 at 15:36 | #15

    @Alice

    I’d prefer not to prejudge.

  16. April 27th, 2010 at 19:47 | #16

    I’d also like an answer to the question I asked earlier. “Fran, do you think wind power in South Australia has not reduced natural gas use?”

  17. Alice
    April 27th, 2010 at 19:58 | #17

    @Ernestine Gross
    Probably wise Ernestine – but I note more than one question remain unanswered.

  18. Ernestine Gross
    April 27th, 2010 at 20:14 | #18

    @Ronald Brak

    May I suggest, you repost your question on the weekend thread. Fran once stated that he or she goes wherever the topic moves to.

  19. Ernestine Gross
    April 27th, 2010 at 20:17 | #19

    Ernestine Gross :@Ronald Brak
    May I suggest, you repost your question on the weekend thread. Fran once stated that he or she goes wherever the topic moves to.

    There is also the Monday message board.

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