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Energy: why are we losing?

Rafael Herzberg's picture
Consultant energy affairs Self employed

Rafael Herzberg- is an independent energy consultant, self-employed (since 2018) based in São Paulo, Brazil* Focus on C level, VPs and upper managers associated to energy related info, analysis...

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  • Feb 10, 2021
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Energy: why are we losing?

Historically, Brazil had a very interesting differential due to its matrix (electricity sector) being 90% renewable.

But this century has seen a major change. Now about 30% of our matrix is thermal (coal, gas, nuclear, etc.).

The main changes that occurred: (1) increased emissions and (2) increased costs due to the fuels involved.

In developed countries, programs like demand response emerged and were incorporated in the dispatch" of their electrical systems. Result: cost reduction that benefits energy providers and demanders. In Brazil, this program exists only on paper.

Intermittent energies (wind and solar) in developed countries are being handled to avoid the effects of the "duck curve". In Brazil, this theme does not even exist yet and the associated costs are just passed on.

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Bob Meinetz's picture
Bob Meinetz on Feb 10, 2021

Rafael, though hydropower is among the most predictable of renewable energies, dispatchable sources (primarily gas) are necessary to balance supply during extra-dry or -wet conditions. I would imagine mixing gas-fired electricity with hydro permits engineers to squeeze the most power out of Brazil's hydro, yet maintain system reliability.

"Intermittent energies (wind and solar) in developed countries are being handled to avoid the effects of the 'duck curve'."

Generously assuming the U.S. can still be considered a "developed country" - the effects of the duck curve in California are being handled by A) curtailment, or paying generators not to generate when system reliability is threatened, by B) selling electricity at "negative prices" to our neighbors - essentially, paying Arizona, Nevada, and Oregon to take our excess electricity, and by C) rolling blackouts, to prevent demand from outstripping supply as the sun sets on hot summer days.

Viewing demand-response as anything other than shifting the responsibility for providing adequate supply to customers is becoming an increasingly-tough sell here, as prices for electricity skyrocket during the times it's most useful.

All of these techniques exact significant financial penalties on electricity customers (electricity prices in California are among the highest for U.S. states). So far be it from me to justfiy your claim that Brazil is "losing" with 70% renewable electricity - California is struggling to meet half that percentage.

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Rafael Herzberg on Feb 11, 2021

Hi Bob,

What all of us read these days is a strong effort to increase renewavble sources around the globe.

Brazil is increasing themal and a lot! And what makes me really sad is that there are still great opportunities for new hydro power plants which are the cheapest in terms of CAPEX (in USD/instlalled kW) , the cheapest in USD/MWh delivered and the lowest emmissions as compared to other sources considering its life cycle.
 

Bob Meinetz's picture
Bob Meinetz on Feb 11, 2021

"there are still great opportunities for new hydro power plants..."

Rafael, I was curious about this claim, and after a bit of searching I found a study that supported it: Brazil's current installed hydropower capacity is 114 GW, but there exists potential for 146 GW more. Brazil, with pumped storage, could be powered by 100% renewable electricity.

That conclusion comes with several caveats, however:

"The construction of hydroelectric dams is clearly associated with an array of both positive and negative environmental impacts. Some of them may represent real constraints for the installation of such structures, while others may act as a sustainable way for the local development. Since energy is widely need for almost all human activities, it is necessary to make a balance of pros and cons related with hydropower generation. No universal recipe can be here established, since regional peculiarities will play a striking role in the decision process. In the case of Brazil, which is the main subject of this paper, government, civil society, water users and scientific community are since many years deeply involved in this relevant discussion. Under a broad point of view it may be assumed that the advantages generally prevail over the limitations and a solid trend of further energy generation by the installation of hydropower dams can be identified in the country."

Like all renewable sources of energy, hydropower has significant land use impacts. In the United States during the 1960s, Sierra Club supported nuclear energy as a less-damaging alternative to hydroelectric dams:

Then they discovered there was more money in opposing it.

If you haven't already, you'll discover most of the opposition to nuclear power is not that it's dangerous, but that there isn't enough potential for profit. Nuclear is, quite literally, too cheap.

Rafael Herzberg's picture
Rafael Herzberg on Feb 16, 2021

Hi Bob,

If I were to choose I would explore "all the options". This would include evaluating all major aspects such as economical, environmental, regulatory, etc., etc. 

Then these projects would be ranked and the chosen ones would be contracted. A well informed, robust decision.

Here in Brazil given the local circumstances, the systemic corruption, is the name of the game. The choices do not have to do with what's best but what's more convenient for those ones who are able to "negotiate deals". 

Most of the secretaries of energy of the past decades are being investigated because of their huge corruption scandals. We are talking about huge sums of money according to the "Lava Jato" investigations. And to make all this possible it is important to say that huge power companies (generation and distribution) are stated owned and the guys who lead them are "friends" so it makes it easy to "make their sweet heart deals" happen.

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