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The Fundamental Limitations of Renewable Energy

Many people still think that it will not be long before renewable energy such as solar and wind becomes outright cheaper than fossil fuels, thereby leading to a rapid expansion of the thin orange slither in the graph below. This is an ideologically very attractive notion, but, as discussed in this article, it is questionable whether this is in fact physically possible.

Global primary energy by source

So, what does renewable energy have to accomplish before it can compete with fossil fuels in an open market? Well, in short, we will have to overcome the diffuse and intermittent nature of renewable energy more efficiently than we can overcome the declining reserve qualities and unrefined nature of fossil fuels.

In other words, renewables need to overcome the following two challenges in order to displace fossil fuels in a fair market:

  1. Solar panels and wind turbines need to become cheaper than raw fossil fuels. This is the challenge posed by the diffuse nature of renewables.
  2. Storage solutions need to become cheaper than fossil fuel refineries (e.g. power plants). This is the challenge posed by the intermittent nature of renewables.

Point number 1 is the way in which we procure our energy (mining/drilling fossil fuels or deploying solar panels and wind turbines) and point number 2 is the way in which we make this energy useful to society at higher levels of penetration (refining fossil fuels to electricity or smoothing out the intermittent surges of renewable energy). Without point number 1, point number 2 cannot exist and without point number 2, the energy procured in point number 1 cannot sustain a complex society such as ours.

Thus, if renewables are to challenge fossil fuels in an open market, technology must advance to the point where renewables can compete under both these points. This article will examine whether this is in fact possible.

The diffuse nature of renewables

Renewable energy advocates often point to the total energy fluxes of the Earth (below) and proclaim that renewable energy resources are essentially boundless. Yes, it is true: we are surrounded by incredible amounts of diffuse renewable energy (e.g. solar radiation and wind). Unfortunately, however, this energy is useless to us unless it is concentrated into forms such as electricity or fuels.

RenewableEnergyPotentialVsFossilFuels

The reason behind this is called the second law of thermodynamics which states that energy must flow from a concentrated form to a more diffuse form in order to do work. Our entire society was built on the work performed through transforming concentrated fossil energy to diffuse heat and, in order to compete, renewable energy technologies also need to deliver such concentrated energy.

Now there is no question that renewable energy can be sufficiently concentrated by solar panels and wind turbines. The only question is whether this can be done more cost effectively than simply digging already concentrated fossil fuels out of the ground.

This challenge is two-fold. Firstly, energy does not like to be concentrated, hence the fact that the average commercially available solar panel is only about 13% efficient. And secondly, because the energy source is so diffuse, vast areas need to be covered in order to harvest this diffuse energy. The video presentation below gives a very informative discussion on the size of the areas we are talking about here (the video is long, but definitely worth the time).

As a result of this challenge, it was previously calculated that the solar panel price needs to fall to about $0.31/W installed in order to compete with coal at $100/ton. It is therefore clear that installed solar prices still need to fall about one order of magnitude before we can see a sustained market driven displacement of coal by PV.

Is this possible? Well, the most optimistic projection in the OpenEI database sees solar PV levelling off at about $1.44/W installed which is more than quadruple the required level. Perhaps we will be pleasantly surprised by some technological miracle in the medium-term future, but achieving the required prices with current PV technology will unfortunately be completely impossible.

The intermittent nature of renewables

If intermittent renewables like solar and wind are ever to contribute a sizable portion of our global energy mix, a large amount of additional infrastructure will need to be deployed in order to counter the large fluctuations in output varying over timescales ranging from seconds to years.

As an example, the variability of wind generation in Germany for 2012 is shown below. On a countrywide basis, the output varied over more than two orders of magnitude from a minimum of 0.115 GW to a maximum of 24 GW. It is clear that a large amount of extra infrastructure will be needed in order to smooth out this erratic output to something that better resembles the demand profile. Solar PV is of course even worse because it generates no power whatsoever for the majority of the time and delivers most of its energy in the few hours around noon.

German wind output 2012

Again, there can be no doubt that we have a wide range of technically proven solutions to this problem. When just looking at the area of energy storage there are many proven ways to store energy in chemical, kinetic and various potential forms. But again, the challenge is to deploy these solutions at a lower cost than that involved in the refinement of fossil fuels.

A coal power plant is the most expensive kind of fossil fuel refinery. For example, a standard coal-fired power plant must sell electricity for about $0.06/kWh, but coal at $100/ton costs only $0.015/kWh. The remaining $0.045/kWh represents the price of refining coal to electricity and arises primarily from the low efficiency and high capital costs of coal plants.

So, how does energy storage compare? Well, a recent test of lead acid and Li-ion batteries found that these technologies could store energy for about $0.34 and $0.40 per kWh over their respective lifetimes. Hence, we again have to conclude that the most ideal renewable energy storage solution is still about one order of magnitude away from challenging fossil fuels on a level playing field.

The Li-ion battery throughput cost of $0.40/kWh mentioned above was calculated for an initial cost of $600 per kWh of capacity. Most optimistic projections for Li-ion battery costs give longer-term prices at about $200 per kWh of capacity. At these prices, battery storage would be about triple the price of refining coal to electricity. Again, we need a technological miracle.

Final word

So, these are the facts. In order for intermittent renewable energy sources such as solar PV to effectively compete with fossil fuels like coal, both the price of installed solar panels and the price of battery storage will need to reduce by a full order of magnitude. In addition, optimistic long-term projections state that both solar panels and battery storage will reach technological maturity at roughly triple the cost of their fossil fuel counterparts.

Does this mean that it is fundamentally impossible for renewable energy to trump fossil fuels? Well, I would stop short of saying that, but, from this analysis, it appears unlikely that we will see a large scale market driven displacement of fossil fuels by renewable energy in the first half of this century.

Schalk Cloete's picture

Thank Schalk for the Post!

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Schalk Cloete's picture
Schalk Cloete on Aug 9, 2013 10:32 pm GMT

Thanks Jonathan. I found this comment of yours very informative indeed. 

I have great respect for people who are willing to adopt such a low-energy lifestyle. As you can see on my blog, I also advocate such a low-impact lifestyle and am working towards putting together a full multifaceted plan for happy, healty, wealthy and sustainable living. 

Just to be clear, I fully support home solar (especially home solar water heating) as a mechanism for concerned individuals to reduce their footprints. I just think the technology still has a very long way to go before it can support a fully industrialized society where the vast majority of people expect energy in great quantities without having to make any meaningful lifestyle alterations. 

Anyway, I would really like to get your opinion on a few more specific questions. However, this thread is becoming a bit narrow and I will therefore write a new comment which should appear at the top of the comments section. I really hope that you can take the time to discuss further there. 

Clifford Goudey's picture
Clifford Goudey on Aug 9, 2013 10:53 pm GMT

Schalk, you wrote, “The other effects (e.g. bad air quality and mining-related deaths) are immediate negative externalities which are directly experienced by consumers, thereby enabling them to price this into their consumption and voting decisions.”

First off, consumers don’t experience mining-related deaths, miners and their families do.  Second, bad air quality does not allter the price at the pump or the price per kWh.  These unaccounted externalities force the consumer to make decisions against their short-term economic interests.  The only way to achieve the needed levels of change is to embed these costs into the direct price paid for dirty energy. 

 

Jonathan Cole's picture
Jonathan Cole on Aug 9, 2013 10:56 pm GMT

Schaulk, You wrote:

I just think the technology still has a very long way to go before it can support a fully industrialized society where the vast majority of people expect energy in great quantities without having to make any meaningful lifestyle alterations.

What happened to the pricing mechanism that you refered to earlier? Do you believe that people do not value their lives, health and lives of their families enough to change their habits to a lower impact lifestyle even when they still get to have all the amenities they now enjoy and for less money over the medium to long-term?

This is definitely possible. I am doing it as we speak. Almost everyone could be moving in this direction now except for the propaganda mostly paid for by multi-national energy companies that tells people that fossil fuels are economical. The ever-increasing use of these fuels is destroying the thin layer of the world that we inhabit. If you end up with cancer or a heart attack, how can that be a reasonable cost ewhen benign alternatives are available now, even without subsidies. My energy system cost about the same as a late model used car without subsidies. Are you telling me that there are not hundreds of millions of people who could afford to make this choice today?

You may not be intending it, but by furthering the fiction that fossil fuels are cheap you are assisting in the destruction of natural world. I appreciate your intention to be rigorous in your analysis, but you are making fundamental errors that need to be corrected.

 

Schalk Cloete's picture
Schalk Cloete on Aug 9, 2013 11:33 pm GMT

Jonathan, I was really impressed that you can buy a 3000 cycle battery for close to $200 per kWh of capacity. However, since you claim that only 25% of the generated electricity is cycled through the battery (about 2.4 kWh per day), the average depth of discharge is 25%. One such cycle per day for 3000 cycles would work out to $0.33/kWh and $0.45/kWh if an 8% cost of capital is included. If this is the optimal way to use these batteries, the costs quoted in this article therefore remain valid.  

Another point I was wondering about is the cost of a grid connection. I think I shared with you in some previous comment that I installed solar panels on my parents’ home in South Africa and have asked them to closely monitor the performance and cost savings. The network operator there charges about $40/month in fixed costs just to be connected to the grid, so even if you only get 2% of your yearly electricity from the grid, you would still get charged this fixed amount. Is this so in your case as well?

I also assume that you live in an ideal solar location where there are very few cloudy periods and very little seasonal variation. We have observed that, even in South Africa, the winter output is about half of the summer output and cloudy periods cut the output to about 25% of the sunny-day equivalent. 

Electricity costs for the full system you quoted ($24000 if three battery packs are used over the 30-year panel lifetime) would work out to $0.60/kWh under the assumptions of a 20% PV capacity factor, an 8% cost of capital and a 30 year lifetime with no panel degradation. If a $40/month grid-connection charge is included, the cost would increase to $0.74/kWh and, if it is assumed that 20% of the captured electricity is lost in the peaks and through battery cycling, the cost would be $0.92/kWh. 

This is definitely affordable for environmentally concious first-world citizens and I would fully encourage people to invest in such systems to reduce their footprints. However, as much as I would like it to be different, I really do not think that we will be deploying such systems at a rate which will make a significant difference to the global climate picture any time soon. 

Schalk Cloete's picture
Schalk Cloete on Aug 9, 2013 11:48 pm GMT

My point was just that people in general can quite effectively weigh positive and negative externalities in their consumption habits and voting decisions. China was just used as an example of the enormous positive externality of coal electricity at $0.03/kWh. Lifting 71% of your population out of abject poverty is certainly a monumental achievement. 

China may not be a democracy, but people still voice their concerns regularly (about 500 protests per day). The country also has a long history of serious uprisings. If the immediate negative externalities outweighed the immediate positive externalities by as much as you suggest, the people would have revolted long ago. 

Jonathan Cole's picture
Jonathan Cole on Aug 10, 2013 1:24 am GMT

You can get into the semantic argument of how to calculate the cost of battery storage if you like. I calculate it based on its total potential to store electricity. The amount you actually store is highly variable and actually not that easy to calculate in a distributed system, since the inverter and the batteries share the output of the PV. And since there is a tremendous variety of situations utilizing the generated and stored electricity. If you are trying to make an economic comparison, here is a simple calculation for you:

If you have an electric bill from the electric company of $150/month and instead you buy a 30 year solar energy-with-battery system for $24000 , it looks like this:

Utility power – $150/month x 12 months x 30 years = $54,000 (before any adjustments for inflation/price increases which have, in fact, been rising steadily due to increasing fuel costs).

Solar with battery system for 30 years = $24,000 + cost of money and you get your energy price locked in without inflation for 30 years. The cost of the system is recouped in 10-15 years depending on the rate that your utility charges. This is without any subsidies. With subsidies, where I live, the combined state and federal subsidies amount ~50% of the cost of the system meaning that it costs the homeowner $12,000 if they have taxable income to offset. And that offset can be carried over as many years as necessary to get the credit.

This looks like a pretty good deal to me, especially if you throw in an uninterruptible power system. In thirty years I have never had a power outage. Oh and by the way, we can save the natural world for future generations. That must be worth something!!

With the new battery technology you can do the same but using a battery that has a longer life and does not require any maintenance.

 

Jonathan Cole's picture
Jonathan Cole on Aug 10, 2013 2:07 am GMT

I forgot to mention, I live in a fairly cloudy area in the foothills of Mauna Kea at ~20 degrees lattitude..

The utility minimum connection fee is $22. Although I am not connected.

I have a backup generator that has CapEx of ~$5000 for a thirty year installation. Fuel/maintenance costs of about $150 per year.

The amortized cost of the batteries is about $10-$15/month including maintenance (distilled water).

So aside from my CapEx, my cost to provide myself with electric power is <$30 a month.

Since in Hawaii, the electric company charges $0.44 kWh CapEx payback is very fast.

 

Schalk Cloete's picture
Schalk Cloete on Aug 10, 2013 8:57 am GMT

Thanks Jonathan. Yes, my blog posts are written by the optimist in me while my TEC posts and some other blog pages are written by the realist in me. The optimist wants to believe that it is possible for a substantial portion of the richest billion people on this planet to willingly change their lifestyles in order to cut their footprints in half and simultaneously enjoy great gains in health, wealth and happiness. On the other hand, the realist in me believes that our world will continue chasing exponential growth in consumption at almost any cost for the foreseeable future. 

In the developed world, we have to see growth in order to keep paying our enormous debts and unfunded liabilities. The real issue, however, is the developing world where billions of people have aspirations to one day enjoy western standards of consumption. It is due to these megatrends that I am so insistent that we should cut CO2 in the most cost effective way and that we should be very careful of signing too many expensive 20-year feed-in tariff contracts. If we insist on combating climate change primarily through renewables, the rapid rise in developing world emissions will continue unabated as projected by all of the largest energy authorities and we will end up in a 4 deg C world and, if the developed world takes feed-in tariffs too far, this added economic burden can push their already fragile economies over the edge, leading to massive economic turmoil which will impact disproportionately on the poor. 

About your electricity figures, I have to point out that there is a big difference between capacity and actual production, especially when dealing with low capacity factor renewables. In terms of actual production, the US only got 12.2% of its electricity from renewables in 2012 – more than half of this being hydro (the output of which has been constant since about 1970). In 2012, solar PV contributed 0.1% of US electricity. 

According to the BP statistical review, global electricity generation is about 5 times that of the US at 22000 TWh. Generating this from PV at a capacity factor of 15% will require an installed capacity of 17 TW (while ignoring the effects of intermittency and low EROI). If systems have a 30-year lifetime, the world will need to install 567 GW of PV per year ad infinitum in order to maintain such a system (I assume here that the growth of electricity demand in the developing world would consume contributions from wind/hydro within the timeframes we are talking about). Thus, if we could profitably deploy solar PV at this rate today and overcome all the issues relating to intermittency going forward, we would be able to clean up the electricity sector via solar PV in 30 years’ time. However, the global installation rate today is still almost 20 times lower than the required 567 GW per year. In fact, global coal use in the year 2011 still expanded by almost two orders of magnitude faster than solar PV (8078 PJ vs 93 PJ). 

It should also be mentioned that electricity production is responsible for only about a third of global fossil fuel use with the rest mostly employed directly in industry or in transportation. Using renewables to displace these fossil fuels will be much harder, both technically and economically, and will require complete overhauls of many other industries. 

Therefore, while I applaud your work and your vision, I have to maintain that, in the absence of a true technological miracle, solar panels will not save the world. 

Clifford Goudey's picture
Clifford Goudey on Aug 10, 2013 12:24 pm GMT

That’s not what I read.  What you are consistently promoting at the expence of just about every other approach is CCS – a non-economic non-solution that apparently interests you. 

Jonathan Cole's picture
Jonathan Cole on Aug 10, 2013 6:02 pm GMT

If you want to save the world, you need to do two things – quickly.

  • A steep carbon tax with rebates to consumers as James Hansen has suggested. http://www.carbontax.org/blogarchives/2010/04/25/scientist-james-hansen-... This will force the true costs of fossil fuels to be included in the costs of fossil-based energy. But it must be large enough after ten years such that the developed world will be flocking to more benign solutions.  (By the way, this climate scientist says it is already over for the human race: http://guymcpherson.com/climate-chaos/ )
  • Steer huge amounts of capital toward the build-out of alternate technologies (CCS may be included if it can be proven to actually solve the problem without introducing some more unanticipated dangerous side-effects, like leakage, blow-outs and unintended chemistry)

I am already 66 years old, so while I may witness the coming collapse, it is your generation that must bear the greatest fallout from the corrupt, money-chase now at work in the world.

I admire you for your intensity, but I do not admire your willingness to be a “realist” in order to avoid conflict with the most widespread corruption of human values in the history of the world. What you may not understand is that this propensity is built into the human race and we have been fighting our darker nature throughout history.

If you understand the necessity of pricing in the costs of our activities to the natural world, then it is a bit suspect to then decide out of “realism” to jump in bed with the perpetrators in order to try to bail them out. You should be using your intelligence, education and idealism instead of your “realistic” self to solve this problem. CCS (which of course must go forward if it can be proven to be a bridging technology) is as yet unproven and for you to use your prodigious writing capability to DISCOURAGE the only benign energy solution we have available, namely solar energy (which includes wind, wave and tidal)  and then to actually try to prove that it is not realistic despite the fact that it is already providing millions of times more CO2 abatement than CCS and will continue to do so by any reasonable assessment of the trends, almost seems like you are having a collapse of your own. A moral collapse.

I suggest that you stick to your research of CCS if you want to be a realist and forego the bashing of the renewable energy solution. When I started researching and developing solar energy in 1983 no one thought that it had any future. Many people like yourself seem to believe the same thing today because the collapse is coming faster than we can deploy dispatchible, uninterruptible solar energy systems. But I want to tell you, you are wrong. Because it will be a combination of things that will change our energy paradigm.

Most importantly is that we will stop wasting energy. http://awesome.good.is.s3.amazonaws.com/transparency/web/1101/good-energ...

Next we will require the most efficient energy-use technology be deployed in all appliances.

We will require the recycling of all refined materials that have high energy content.

We will deploy, as rapidly as possible, benign energy technologies while simultaneously forcing the fossil fuels to be left in the ground.

Jonathan Cole's picture
Jonathan Cole on Aug 10, 2013 6:29 pm GMT

The first system I built was in a remote location and in place for about 20+ years before it was replaced by a grid connection by an old lady who did not want to bother add water to batteries. As far as I know it was working fine at that time. I am now living with a system that is seven years old. At the rate that solar panels are going down in price (projected to be $0.36 watt by 2017), I expect the systems to cost much less in the future than they do now. (Reasonable analysis of the cost trends suggest that it is possible to achieve $08kWh in places with sufficient solar insolation) The flooded lead acid batteries(FLA) that I use now are always recycled – the lead is too valuable to throw away. However, in the next generation of batteries, lithium titanate, there will be a smaller problem since they are 1/4 the weight per kWh of FLA and they last two times longer. However, I have read that because of the low value of titanium, and its non-toxic nature that it may not be economically viable to recycle it. Of course that may change if billions of batteries start being deployed.

Jonathan Cole's picture
Jonathan Cole on Aug 10, 2013 6:34 pm GMT

I forgot to respond to one part of your question. What to do with old panels. I will keep using them until they no longer function. which could be as long as 50 years or more. (I’ll be dead by then) PV panels degrade more or less evenly resulting in in reduced capacity. A 100 watt panel may only produce 80 watts after 20 years. It may only produce 70 watts after 30 years. Only when it produces insufficient voltage is the panel’s usefulness over. You can easily make up for reduced capacity from gradual degradation by employing more efficient equipment or by adding more panels which will be cheaper in the future.

Lewis Perelman's picture
Lewis Perelman on Aug 10, 2013 7:57 pm GMT

Jonathan, the alternative to realism is delusion, or just nonsense.

Saying “must do” does not create realistic possibility. The steep carbon tax you wish for (wishful thinking is not a strategy) is not going to happen. Building out ineffecient, ineffective technologies — as opposed to developing new and better ones that can be truly competitive with conventional systems — is economically infeasible and contrary to popular economic aspirations. So it’s not going to happen either.

I’m with Schalk here. You are very unlikely to solve a problem if you don’t start with a realistic understanding of what the problem is and what kind of solutions are possible.

Jonathan Cole's picture
Jonathan Cole on Aug 10, 2013 8:23 pm GMT

Thanks for the tip.

Your “realistic” solution is only your opinion. I suggest you stop trying to discourage the very development that you say is necessary. That is a realistic replacement for our failed energy paradigm.

You might want to check into your own delusion and how it plays into the coming eco-collapse.

I have been living with solar energy systems with storage for 30 years, so I know it works. And that I can afford it. New durable, zero-maintenance storage technologies will make this even cheaper, more user- friendly and low-maintenance. And that to me is realism. I would rather use my disposable income to prevent eco-collapse than to buy a Harley Davidson, or a Corvette or an expensive vacation, for example. 

There are millions of other examples of people who are ready to do the same thing. I call that realistic. I call that a rapidly, no, an exponentially growing market whose benefit/cost ratio is rapidly rising. I call that realistic. I call that the biggest entrepreneurial opportunity in the history of the world, if we can survive that long. That to me is realistic.

 

 

Roger Brown's picture
Roger Brown on Aug 10, 2013 10:23 pm GMT

I am not sure what you think is realistic about ignoring limits to growth. Of course there is a place for promoting short term policy options that are consistent with current cultural prejudices, but if you are not also taking every convenient opportunity to say that if we don’t deal with consumption standards a real ultimate solution to our environmental problem is not possible, then I am not sure what you think that you are accomplishing. Of course, if the day of reckoning for growth based economics can be delayed for a few decades you and I might end our lives reasonable comfortably, but it is not clear that the policies you are promoting will do anything to soften the ultimate landing of our current economic system.

The claim that limits to consumption cannot be discussed because people don’t want to think about it is, in some degree, a self fulfilling prophecy. If every time some stood up in a roomful of people and said, ‘If we don’t deal with standards of consumption we are just spitting into the wind of environmental destruction‘ she could be confident that three or four other intelligent people would stand up with her and say ‘Tell it like it is, sister.’ then  maybe we could persuade a significant fraction of the population that subject needs to be discussed.

I should point out by the way that I am not suggesting the poorest sectors of the global population should never rise above their current level of consumption. The consumption the most highly developed parts of the world needs to be reduced so that the poorer parts of the world can rise to meet us on some reasonable common ground. I do not condemn economic growth as a phenomenon; I merely condemn an economic system which structurally lusts after endless growth in all portions of the economic community. The idea that because poorly controlled private credit markets have created  gigantic unsustainable debts, we need to go on destroying the environment for decades into the future in order to pay them off is absurd. What we need is debt destruction not environmental destruction. In all likelihood this destruction will occur in an uncontrolled financial crash, but an intelligent controlled destruction of debt could take place if the political will to bring it about existed. I could go on at greater length, but unfortunately I am largely in agreement with you about the futility of such discussions. There is no audience for it. However, since I am not a prophet of doom by nature I keep hoping that an audience will eventually come into existence.

Warren Weisman's picture
Warren Weisman on Aug 10, 2013 10:51 pm GMT

Wind and solar will not be doing the heavy lifting in the post-carbon future, distributed biogas and gasification or direct burning of annually-renewable biomass will. Wind and solar are intermittent electric sources – all heat they generate is lost – good for peak loads in regionally apropriate areas.

Biogas and biomass will not meet today’s energy demand, but since 75% fo energy generated today is wasted out the smoke stacks of remote power stations, the 100 QBtu consumed by the US per year could be trimmed to 30 QBtu just by switching to distributed combined heat and power over centralized utilities.

Lewis Perelman's picture
Lewis Perelman on Aug 11, 2013 7:32 pm GMT

Jonathan, entrepreneurs — which seems to apply to you — are by nature irrational. It takes a certain amount of delusion and what Greenspan called “irrational exuberance” (or Keynes’ “animal spirits”) to take big risks to create something that is yet unproven.

As a result, most entrepreneurs fail most of the time. But the success of the minority is the essential engine of economic progress.

There is a difference, though (I think), between the illusions of commercial entrepreneurs and the illusions of policy entrepreneurs. The failures of the former for the most part harm only themselves and maybe their backers. The failure of unrealistic policy entrepreneurs though can impose costs on many other people, costs that they had no choice in accepting. The invasion of Iraq is a rather glaring example.

Secondly, it also is a common part of the innovation process that a relatively small population of “early adopters” is willing to pay a premium price to be among the first to try something that seems to be the next big thing, the wave of the future, the leading edge, etc. This cohort plays an important role in providing some early market experience for vendors. But making the transition from that group to capture the mainstream consumer — and achieve large-scale market penetration — generally requires achieving a higher ratio of value delivered to cost. Innovators who can achieve that go on to build important new businesses and industries. Many don’t though, and many inovations fail and disappear despite some early market success.

But again, that normal process of commercial innovation is different from the political attempt to use government to subsidize or otherwise force wider adoption of immature technologies than normal consumer demand would warrant. Those efforts are commonly rationalized on the grounds that artificially expanding scale of production will lead to lower, more affordable cost via the “learning curve”; and/or that beneficial externalities justify forcing people to pay higher costs. In practice though, such government intrusions often lead to increased waste, corruption, and the proliferation of shoddy, unreliable products which can actually undermine the market opportunities for other innovators who come up with better, lower cost solutions. Similarly, the attempt to internalize externalities often spawns collateral, negative impacts that may overall do more harm than good.

Jonathan Cole's picture
Jonathan Cole on Aug 11, 2013 8:01 pm GMT

You wrote:

“Jonathan, entrepreneurs — which seems to apply to you — are by nature irrational. It takes a certain amount of delusion and what Greenspan called “irrational exuberance” (or Keynes’ “animal spirits”) to take big risks to create something that is yet unproven.”

By your definition, I am not an entrepreneur because I have already proven over the past thirty years that PV bundled with battery storage works extremely beneficially to the owner, is far more reliable than utility power, is more secure from natural and man-made disaster, is uninterruptible (meaning no power outages), is easier on equipment because of the lack of surges and brownouts due to the ballast effect of the battery, is user-friendly, low-maintenance and affordable. I am now involved in bringing to market the next generation of this technology which couples PV to more durable, no-maintenance batteries and IT to provide solar-powered micro-island power stations that can also be paralleled for additive output and utilized extremely flexibly by homeowners or utilities.

I do not disagree that poor policy stands in the way of the solution of nearly every critical problem facing humanity. Sometimes that poor policy is as a result of the hubris and ignorance of politicians and their minions and other times, maybe more often the case it comes from the fact that bad policy has been purchased by lobbyists on behalf of their corporate paymasters.

For instance, the electrical utility industry is huge and utilizes a portion of its resources to prevent competition. Unfortunately this mindset also blinds them to seeing where their true interests lie. I am not so much an entrepreneur as I am an insurgent storming the walls of the intransigent energy lords. They want to continue to poison the world because they are too lazy to adapt, and my children, grandchildren, community and country are being ruined by this intransigence.

In any case I consider myself to be a loyal subject of the best of western values founded on free enterprise and fair play, while rejecting out of hand, the greed-based model that has taken hold of the world and is furthered by misinformation, propaganda and abuse of power.

During business school I read an interesting opinion from a successful executive. They said if you want change, look for it where it already exists as an insurgent activity and then support that insurgency with resources.That’s me. I am the technology insurgent in the midst of the system.

 

 

 

 

Warren Weisman's picture
Warren Weisman on Aug 12, 2013 12:22 am GMT

Our home biogas systems, for example, cost $1,995 and generate 3 kWh of energy that can be used for either cooking energy or converted in a generator to electric – we recommend the Honda EU1000i (retails about $1,200 w/fuel gas adaptor). So, in Los Angeles or New York, you’re getting 75¢ of free energy from waste you were going to pay to get rid of, so $22.50 per month.

So, the entire system would pay for itself in a little over 7 years, or as we like to say, it pays for itself in a single day when the power goes out and you still have hot coffee and are watching movies on TV while recharging your phone.

There is no energy loss through storage, as the gas is stored in the digester until use. The system works the same regardless of weather or time of day. 

Clifford Goudey's picture
Clifford Goudey on Aug 12, 2013 5:18 pm GMT

Lewis, I sense you misunderstand what Johnathan has said, or was that simply a shotgun approach to criticizing energy innovation.  The goal of every legitimate renewable-energy innovator is to offer something that does what people want for less cost than the competition.  The problem is conventional energy remains heavily subsidized thereby limiting the market opportunities of many innovations.  That the fossil-fuel sector is able to externalize much of its costs onto society is not debatable.  Furthermore, because of the scale of that activity, we are already paying for the collateral, negative impacts and will continue to do so for centuries.

It may take more that irrational exuberance to counteract the resulting strangle hold of those profiting from the energy status quo. Otherwise, you make some interesting points/

Jonathan Cole's picture
Jonathan Cole on Aug 12, 2013 5:30 pm GMT

The interesting thing is that some people focus on the failures of the politicians and policy makers while giving the corporations a free ride. That is a mistake of the first order. The problems we face are due to a corruption of values at every level of society. Somehow the idea that if we personally profit while ruining the world, that is somehow OK. Problem is, you are part of the world. If you ruin it, you are ruining it for yourself, your family and your community. How can that possibly be the right thing to do?

 

Lewis Perelman's picture
Lewis Perelman on Aug 13, 2013 3:42 am GMT

Clifford, I understood very well. In the political context, this sort of idealism is not very effective.

The reality is that renewable energy for the most part receives far more subsidies as a share of BTUs delivered or revenues than does the fossil fuel industry. The latter could easily survive without subsidies; the former mostly cannot.

Internalizing externalities is one of those ideas that works far better in theory than it does in practice.

One can lament that these realities are unfair, but that changes little. What can change things is developing energy solutions that can really compete effectively without subsidies or political favors. That may yet be challenging but there is no reason in principle that it cannot be achieved, and a lot of people are working constructively to achieve it.

Yes, the fossil fuel industry is big, powerful, rich, and entrenched. That is why attacking it politically is ill fated.

Viz., Sun Tzu: “…the skillful leader subdues the enemy’s troops without any fighting; he captures their cities without laying siege to them; he overthrows their kingdom without lengthy operations in the field.”

Jonathan Cole's picture
Jonathan Cole on Aug 13, 2013 4:57 am GMT

I live in a mild rural area but it is very cloudy. I just got back from Germany. They are receiving 3 times more solar insolation than I amat the moment although that does not necessarily hold during the winter. If you want to talk about pragmatic use of solar energy, it should be deployed between 30 degrees south latitude and 30 degrees north latitude. It is really cost effective at the equator because the length of days is the same winter and summer so you don’t need to oversize the system for the short season. To provide power four a four person household is probably 25-35% cheaper than, in a place like Seattle. By the way, I have personally not used subsidies. I find it to be a good deal even without government support.

 

 

Jonathan Cole's picture
Jonathan Cole on Aug 13, 2013 5:07 am GMT

I agree with one thing you said. The multinational fossil fuel industry will fall without having to fight. Its business model is as obsolete as the carriage builders at the dawn of the automobile.

However, have you actually calculated the total subsidies for fossil fuels since the beginning of the subsidies versus the total subsidies for clean energy technologies. I would guess that total subsidies for fossil fuels has likely been as much as the annual GDP especially when you consider the subsidy of the  tax-payer supported standing military force and deaths required to secure the supplies.

This has nothing to do with idealism and everything to do with criminal behavior by these multi-national corporations in league with their political lapdogs.

Nathan Wilson's picture
Nathan Wilson on Aug 13, 2013 5:23 am GMT

Direct burning of biomass is much dirtier than burning natural gas.  And combined heat and power will never be big, since the low-grade heat that it produces is alot less useful than electricity (especially in the summertime!).

Biomass is a tiny energy source which is suitable to tiny populations with low per capita energy use.  

The Earth has three huge energy sources: solar, wind, and nuclear.  We can never run out of these sources, and preferentially using them will minimize our impact on natural ecosystems.

Warren Weisman's picture
Warren Weisman on Aug 13, 2013 6:23 am GMT

You sound pretty confident about a topic you clearly don’t know the first thing about. A pound of wood can produce 35 cu.ft. of 150 BTU producer gas IN ADDITION to the heat that can be collected from the heat exchanger. It’s enough to heat and power a 1,500 sq.ft. house for 200 heating days with 9 kWh of electric per day with a cord of wood. That’s not a small amount of energy if you actually know what you’re doing and size a combined heat and power system to do the job you need done

Furthermore, biogas yields another 35 cu.ft. of 600 BTU gas from 10 lbs. of wet material, which is enough energy to cook 3 meals a day for 5-6 people.And recycles the nitrogen necessary to regrow the biomass and biogas substrates the following year. i.e. indefinitely sustainable.

Also, it gets old listening to modern engineers who don’t know how to change the oil in their car talk about heat being less useful than electricity. Heat MAKES electricity. 90% of the world’s electric is generated with steam.

That said, maybe you could use your solar panels to help freeze the ground as they are doing around Fukushima to stop the radioactive water leaks? Or does chromosome damage not factor into your efficiency models?

Rick Engebretson's picture
Rick Engebretson on Aug 13, 2013 12:30 pm GMT

Glad to have you on TEC, Warren Weisman.

Clifford Goudey's picture
Clifford Goudey on Aug 13, 2013 2:37 pm GMT

Lewis, don’t believe everything coming from the fossil-energy disinformation machine.  Those involved in the development of renewable energy technologies and projects would be thrilled if conventional energy sources simply lost their subsidies and their present immunity from tipping fees.  Subsidies are typically not sustainable, though the endurance of those showered on fossil and nuclear energy would suggest otherwise.

Schalk Cloete's picture
Schalk Cloete on Aug 23, 2013 6:37 am GMT

The topic here is renewable energy and its potential to displace fossil fuels. The first figure (which is referenced just like all figures in my articles) simply gives perspective as to where we stand in this regard at present. Electricity is simply the most practical area in which renewables can start displacing fossil fuels with the transition in industrial and transport uses guaranteed to be much more difficult. 

About the efficiency, I accept that some prototype solar cells get double the quoted 13% efficiency under ideal conditions in the lab, but I think 13% is a good average for current real-world performance. For example, this EROI article assumes efficiencies of 14% for mono-c Si, 13% for multi-C and ribbon Si and 11% for CdTe cells.

For the electricity prices, I recommend that you read the IEA reference you gave above or consult an objective database such as OpenEI instead of citing isolated cases caused primarily by financial (interest rate) and political (subsidies) factors. It is also a useful exercise to estimate the LCOE yourself based on known capital costs (discounted at standard rates), fuel costs and capacity factors. 

About the batteries, I acknowledge that technology is improving, but even with these improvements, real-world battery costs per kWh throughput remains in the range quoted in the article (see my conversation with Jonathan Cole a few posts down).

Finally, regarding the classic renewable energy rapid-growth-from-tiny-base reference about batteries, consider that global electricity consumption is about 3 million times the 7 GWh per year figure you mentioned. It could be informative to take some time to consider the realistic perspective provided by the reference in stuart phillips’ comment below. 

Clayton Handleman's picture
Clayton Handleman on Aug 23, 2013 8:43 pm GMT

The entire $60 Billion+ renewable energy industry has been built as a result of government policies and intervention.  It is very unlikely that there would be any substantive renwable energy industry had it not been for the Ford and Carter policies of the 1970’s followed by bold Japanese, then German, then Italian and now Chinese. 

There is no infrastructure industry that I am aware of that has not received government intervention.  Sometimes it is not so good, like, in my opinion, corn ethanol.  But sometimes it works out pretty well like the Internet and Solar Modules that have been driven down the learning curve to prices that nobody dared whisper 15 years ago.  It is worth pointing out that China, while some were bemoaning the fate of Solyndra and using it as proof of the failure of government intervention, China was using similar programs, based upon simple learning curve theory, to become the dominant player in the solar industry.  

As for free markets, they only work to drive “least cost options” when all aspects of the system are monetized.  We are not monetizing the externalities so the free market is not being given the opportunity to do its magic.  That is the reason government intervention is appropriate even if, with 20-20 hindsight one will be able to look back and say another path might have been more efficient.

PS, Before we totally give up on the government, maybe we look at some other participants in that program – Tesla, FIRST and SunPower

 

Schalk Cloete's picture
Schalk Cloete on Aug 25, 2013 2:10 pm GMT

As I said, electricity is simply the most practical area where renewables can displace fossil fuels. If I had to discuss industrial and transportation uses, the picture would look a lot bleaker for renewables, but such a discussion is not relevant at present. 

So you would value headlines from Renew Economy over analyses from the IEA and other global energy authorities? Wow… Personally, I never read advocacy websites for minority viewpoints like Renew Economy, Clean Technica, the Hockey Schtick and Wattsupwiththat simply because authors on these sites cherry-pick numbers and stories to suit their preconceived conclusions. In my opinion, the only effect of these websites is to foster subjective bias, leading to perpetual political stalemate and increased market uncertainty – two things that we definitely do not need at present.

About the batteries, there are two primary factors making the digital camera analogy irrelevant. Firstly, when it comes to grid storage, batteries are not replacing anything, but instead are required as an addition to the intermittent renewables striving to replace fossil fuels. And secondly, while electronics only encounter real physical limts at the lengthscale of 1 Angstrom, thereby making material costs all but irrelevant, batteries are very material intensive, implying that the mining, transport and recycling of these materials will impose hard limits on the minimum battery price and the rate of growth in battery production. 

Warren Weisman's picture
Warren Weisman on Aug 25, 2013 7:49 am GMT

Came across an interesting tidbit for a grant application we’re doing. FYI, the average cost of a Chinese biogas digester is about $85 US, as they mostly use triple concrete (a traditional Chinese building material made of lime, sand and clay). 

‘It is estimated 50 million households in China use biogas, potentially offsetting an estimated 17.7 million therms of fossil natural gas every day while avoiding drilling, refining and transmission costs of centralized utilities. At California’s 2012 average $1.35 per therm this would be an $8.7 Billion annual savings.’


Schalk Cloete's picture
Schalk Cloete on Aug 25, 2013 9:06 pm GMT

Well, firstly pumped hydro (the only large scale proven option) is very much limited by topography. It will therefore not be able to make much of an impact on a global scale. CAES is also limited by topography to a certain extent. 

More importantly though, I don’t see much cost reduction potential for these technologies or for wind power. Solar PV could in theory still become substantially cheaper (e.g. organic PV) and, well, batteries just have so much hype around them (together with being the most flexible option) that it was the obvious choice for storage. 

Costs for pumped hydro are substantially higher than that of regular hydro and, since these costs must be added to the cost of wind power and pumped hydro only has an efficiency of around 75%, the net result will be electricity which is at least triple the price of conventional sources. I just don’t think there is much potential to reduce these costs, implying that wind+pumped hydro can never compete with traditional electricity generation on a large scale. 

CAES, despite having been around for decades, is still unproven. Adiabatic designs look interesting, but even those will only have an efficiency of around 70% and will also be quite complex to construct and operate. Much simpler diabatic systems simply have an efficiency that is too low (<30%) and can therefore never be a cost-effecitve option. I will keep my eye on this technology, but my current feeling is that batteries might be a better option. 

Jean-Marc D's picture
Jean-Marc D on Aug 29, 2013 1:01 pm GMT

Really ? Really that much consumption can be delayed ? And most important, for how long actually ?

A majority of homes in France use water heating systems that run only during the night and stores the heated water for the day. It does not however fully compensate for the fact that nuclear power tends to produce too much electricity during the night. This despite that the scale of the problem of constant production of nuclear is smaller than the intermittency of renewable.

Those heaters are usually 6 kW systems, and they run several hours. This is a lot of power for home use, and actually more than most other usages you will be able to find at individual level. And if we get a look instead at industrial or commercial electricity use, how easy do you think it is to delay it’s use ?

If we get a closer look at the electric cars idea, it’s actually a case of trying to have a double use for the batteries inside the car. They will be used both for running the cars and as a distributed energy storage system. How do we handle the two usage conflicting with each other ? How do we handle that when you climb inside your car, you hope to find the battery fully loaded in order to avoid range anxiety ? Except by oversizing the batteries with regard to the really needed size, but then we could just have to independent storage system.

And last, how long do we need to wait to compensate for the intermittency of renewable ? Get a closer look at the German wind production graph above and you’ll see that the low production period far below 5 GW frequently lasts for 3 or 4 days. What is that electricity use that you can happily delay for 3 full days ? Can you delay loading your electric car for 3 days ?

You are not describing an actual, well-thought of, solution. You’re just hand-waving the concrete difficulty of doing that.

But I can acknowledge that you probably just have been mislead by some people who claim to be incredibly smart and knowledgeable energy thinkers, but just fully ignore all of the above when claiming smart grids and delayed consumption can easily solve everything.

Clayton Handleman's picture
Clayton Handleman on Aug 29, 2013 7:27 pm GMT

You make some good points.  However I think the prior commenter’s central point was a good one. 

“you do not take enough into consideration smart grids to contribute to remedy intermitent nature of renewables.”

If you constrain the discussion to Germany or France in isolation, I would agree with you.  However my perspective is global.  At a minimum, absent storage technology breakthroughs, the path to high penetration renewables is at least of continental scale.  In Europe they call it the Super Grid.  I like to call it the SuperSmart Grid.  In either case a Super Smart grid allows aggregation of renewable energy resources over a much larger area. 

US = South West (Dispatchable Solar) and decorrelated wind, Euorpe = North Africa (CSP) and Scandanavia (Dispatchable Hydro) and decorrelated wind.

http://www.friendsofthesupergrid.eu/

This addresses your points – 1) large geographic area – 

Efficiencies studies in US show excellent efficiency and cost per mile for HVDC and 765Vac

Just as one wind turbine is highly intermittent but a wind farm is much smoother, multiple wind farms are better and so it goes with scale, particularly if the scale is sufficient to decorrelate weather patterns such as Great Plains and Atlantic Seaboard in the US. 

2) EVs Dual Use

EVs is a conceptually simple problem.  If it is done right, Consider this:  The Tesla gives the owner considerable control over charging.  Batteries last longer in the band between 15% and 85% so you only set it for full charge if you are going on a trip.  Similarly, in the smart grid there are many scenarios that are doable with good implimentation.  You could have considerations such as the amount you would allow charge to go to the grid or, purchase from the grid.  After all, a truly smart grid will have real time pricing.  This would allow you to have set points based upon price so that if the grid was in trouble price would be high and you might be happy to go with a little inconvenience if power was selling for $2.00 / kwhr, but only let it take 5% of charge at lower rates.  I don’t see any reason to expand the size of the battery.  A lot of the battery capacity is to cover driving patterns that happen with limited frequency for many drivers.  So they have idle capacity that potentially could be used to make them money.  For a simple example, Consider someone who has a short commute during the week and a predictable pattern but uses the car in an unpredictable manner during the weekend.  They would program the rules for selling and buying power accordingly with 0 inconvenience and 0 need for added storage capacity in their batteries.  We are, of course, not talking about tomorrow as the grid won’t be this kind of smart soon.  If the world gets innovative and wise then we will see it in very limited use possibly as soon as 5 years but large scale roll outs would be 10 – 20 years out.  Battery technology and cost has been improving rapidly and given the high demand and volume that is being created by the growing EV and HEV market it is hard to imagine that it won’t accelerate.  10 – 15 years out, is it really so unreasonable to anticipate cycle endurance such that it would be economically beneficial to interconnect to the grid.  And, for instance, if there were 10M EVs in the US and 10% of them had schedules amenable to being available and they were 100kwhr batteries and you average 10% of that capacity made available for peak support that is 10 GWhr of available support.  This report projecting 22M EVs in 7 years worldwide suggests that 10 Million EVs in 10 – 15 years is quite conservative as sales are back end loaded due to increasing fuel prices and decreasing EV prices.

I hope to find time to write about this at length.  The Super SmartGrid is going to be an extraordinary paradigm shift, it is hard for people to wrap their minds around it.  It is only recently transitioning from the minds of visionaries and getting serious consideration.  It is THE enabling paradigm shift that will allow for high penetration of renewables.  The rate of deployment will have a lot to do with views on the significance of climate change and the urgency with which the public at large decides to support seeking solutions.

 

 

 

 

Jonathan Cole's picture
Jonathan Cole on Aug 29, 2013 5:02 pm GMT

The fundamental limitations of CCS?

Here is some good news for the as of yet unproven technology:

Patent Shows Promise for Improved Method of Carbon Capture

Aug. 27, 2013 — An innovative method for stripping greenhouse gases such as carbon dioxide from industrial emissions is potentially cheaper and more efficient than current methods, according to a United States patent based on research by Dr. Jason E. Bara, assistant professor of chemical and biological engineering at The University of Alabama.

Nearly all commercially-available efforts at scrubbing greenhouse gasses, GHG’s, from emissions use a liquid solution of water and amine, derived from ammonia, that contacts the stream, removing carbon dioxide, CO2, or other unwanted gases. The system patented by Bara would replace much of the water in the aqueous amine solutions with a promising class of molecules known as imidazoles, organic solvents with a low vapor pressure, or boiling point.

The patent, granted earlier in August to UA, claims the chemical make-up of the imidazole-containing systems for use in capturing CO2 and other gases from natural gas and post-combustion emissions such as those from coal-fired power plants.

“The advantages of imidazoles in carbon capture are that they are a class of solvents with tunable chemical and physical properties,” Bara said. “This gives us a lot of flexibility in designing a solvent system that can meet process demands.”

There are global efforts to reduce the human-made emission of GHG’s that likely contribute to global warming by trapping the sun’s heat inside the atmosphere, including emission standards and financial penalties on excess emissions. The most common and most studied method is introducing monoethanolamine, or MEA, into natural gas or post-combustion emissions, a process that can capture about 90 percent of CO2 from flue gas.

The use of MEA to scrub flue gas is energy intensive since recycling the solution requires boiling it to desorb, or rid, the CO2 before recycle of the MEA solution back into contact with the flue gas. The cost of the energy needed to use MEA in power plants, for example, would likely be passed onto consumers, Bara said.

Bara’s work shows that swapping most of the water in the process with imidazoles saves energy since the solvent can be regenerated without the energy penalties associated with boiling large amounts of water. Bara’s research shows the solvent system can capture the same or more CO2than MEA.

The cost of capturing carbon is one reason the energy industry has been reluctant to embrace carbon capture on a large scale. “That’s why it is important to look at solvents and materials that are tweaks to what are already established if we hope to do very large scale up over the next decade,” Bara said.

“What’s really nice about this solvent system is that we’re not starting from scratch,” he said. “Many imidazole cores are already commercially available, and through some very simple reactions, we can synthesize the molecules we want in the lab. This should bode well in terms of solvent cost if we were to scale them up.”

This technology has been licensed to the clean tech company ION Engineering in Boulder, Colo., with the hope of further developing this technology for carbon dioxide capture. Bara helped found ION Engineering, and continues as a science adviser with the company.

Bara’s research is funded by the U.S. Department of Energy, the National Science Foundation and the American Chemical Society Petroleum Research Fund.

Other patents based from Bara’s work with imidazoles are pending. U.S. Patent Designated No. 8,506,914 was granted Aug. 13.

***********

I wonder if anyone is thinking about the possible unintended side-effects of this new chemical cauldron in industrial quantities?

Lewis Perelman's picture
Lewis Perelman on Aug 30, 2013 8:18 pm GMT

Regarding this and the comments that followed, this recent article in BusinessWeek — “Every Home a Powerhouse” — is worth looking at: http://j.mp/1dyM0qf

The latter argues, in essence, that the traditional electric utility industry (in the US at least) is headed for severe disruption by the rise of “distributed power”, aka “microgrids.” The focus is heavily on localized solar power production.

Presumably homes, offices, shops, and factories will find it increasingly feasible to “pull the plug” on the electric utility and generate their own power needs. Yet the article glosses over the cost and feasibility of local storage needed to compensate for intermittency, apparently assuming that cheap enough technology eventually will come along to solve that problem too.

The article implicitly poses a paradox: Are government subsidies for renewable/distributed power simply driving the system down an unsustainable path? Subidizing the adoption of distributed power is undermining the economic viability of the electric grid system. But in the ongoing absence of cost-effective storage solutions, the microgrids continue to rely on the availability of the grid to provide backup.

Beside all that, faith in the efficacy of the “smart grid” seems exaggerated in light of the serious problems that bedevil smart grid development. Not least are the acute problems of stability and vulnerability to cyber threats.

 

Jonathan Cole's picture
Jonathan Cole on Aug 30, 2013 8:33 pm GMT

In areas with high cost of electricity like Hawaii ($0.44/kWh) electricity can already be provided by distributed solar with battery storage for ~$0.20/kWh without subsidies. If you think that the next generation of battery storage is an expensive pipe dream, you are misinformed. Toshiba already has a technology in mass-production called SCiB  ( http://www.toshiba.com/ind/product_display.jsp?id1=821 ) a  20-year, no-maintenance battery solution that matches well with photovoltaics.

The obvious benefits of distributed generation with maximized self-consumption of generated power is that it relieves the grid of having to provide increased and more and more expensive distribution infrastructure. The utilities are going to have to change their business model or become distribution-only enterprises. This is inevitable. 

Schalk Cloete's picture
Schalk Cloete on Aug 30, 2013 9:03 pm GMT

Thanks Armand. 

I see many challenges with the smart grid. On the techical side, it will be very complex in the sense that millions of devices must communicate and react in a complementary manner to variable outputs from solar and wind. The engineer in me does not like such excessive complexity simply because there are so many things that can go wrong. Also, as pointed out below, it is debateable just how much of an impact this highly complex system can actually have. 

On the economic side, the smart grid will not happen by itself and can only really start having a meaningful effect if rolled out on a large scale (i.e. when millions of devices are deployed). Substantial government incentives will be required to get this off the ground and, since this will only make sense in regions of high variable renewable energy penetration, subsidies will be pretty much maxed out by that stage. 

About the building-integrated PV, my concern is that many surfaces that are not ideal for solar PV. Walls and windows and roofs that are not facing south at the correct angle will achieve a much lower capacity factor than correctly situated PV panels, thereby hurting the economics. 

Schalk Cloete's picture
Schalk Cloete on Aug 30, 2013 9:09 pm GMT

Jonathan, in a previous comment I calculated the LCOE for the battery and PV system you specified as somewhere between $0.60 and $0.92 per kWh depending on the assumptions made. There appears to be quite a large discrepancy between these calculations and the ~$0.20/kWh you mention here. What is the cause of this discrepancy?

However, I agree that islands are a great place for distributed power. The problem lies with places like China and India where close to 60% of global coal is consumed and coal electricity costs in the vacinity of $0.03/kWh. 

Jonathan Cole's picture
Jonathan Cole on Aug 30, 2013 9:34 pm GMT

By the way, I challenge your figure of $0.03/kWh in China and India since you neglect to account for those externalities that include the wholesale destruction of land, air and water, not to mention our health and prosperity. You should do some reading. ( http://www.sciencedaily.com/releases/2013/08/130829112852.htm or these 3655 research digests http://www.sciencedaily.com/search/?keyword=climate+change )Your calculations are the stuff of industrial propaganda. Your ideas of serving these masters by promoting a technology CCS which to date is not even proven while at the same time acting scientific as you discourage the use of renewables which are already offsetting the carbon from hundreds of gigawatts of generation by fossil fuels is frought with fallacy and loaded assumptions. You, my friend, are in danger of becoming a dishonest broker of information.

Interesting that the electric utility research itself has already realized that it is relying on an unsustainable economic model. “Edison Electric Institute (EEI), the utilities trade group, warned members that distributed generation and companion factors have essentially put them in the same position as airlines and the telecommunications industry in the late 1970s.” 

How is it that you think that your calculations are better than any one else’s?

 

 

Jonathan Cole's picture
Jonathan Cole on Aug 30, 2013 10:21 pm GMT

My calculations were done by PhD physicist trained in Germany at Tuebingen University. He has 90 patents to his name and over 100 academic papers and was an applied physicist at Honeywell Corp. as a specialist in combustion technologies. I feel confident in taking his calculations over yours.

Schalk Cloete's picture
Schalk Cloete on Aug 31, 2013 7:50 am GMT

I’m not attacking your source, Jonathan. I am merely wondering about the assumptions used in the calculations. Obviously, the $0.20/kWh figure cannot be for the $12/Wp system you described earlier. You don’t need a PhD in physics to know that. Perhaps the calculations were for an industrial scale system with pumped hydro storage or a CSP system with thermal storage?

Schalk Cloete's picture
Schalk Cloete on Aug 31, 2013 8:00 am GMT

I suggest that we just agree to disagree on this topic. Your experience in Hawaii and very deep concern for environmental issues are incompatible with my studies of global statistics, historical energy transition trends and holistic view of the interconnected environmental-economic-societal global system – especially with regard to the developing world. 

Clifford Goudey's picture
Clifford Goudey on Aug 31, 2013 2:14 pm GMT

Conventional power have similar issues related to manufacture, installation and decommissioning.  Usually these details are captured in a proper EROEI analysis.  In this respect, renewables are consistently superior to fossil and nuclear.  Here is a useful resource: http://www.resilience.org/stories/2010-07-18/eroei-electricity-generation

Clifford Goudey's picture
Clifford Goudey on Aug 31, 2013 6:35 pm GMT

Don’t you think the energy of the fuel should be included in these calculations?  How can a fossil plant generate more energy than it consumes, let alone 28 times that input. 

Clifford Goudey's picture
Clifford Goudey on Sep 2, 2013 1:31 pm GMT

The concept of EROI was developed in order to compare the production efficiencies of various energy resources and alone is useful only when compared across similar types of finite natural resources.  As peak production of these resources approaches or is reached, EROI used in this way becomes more important.  So, by all means use it to compare the merits of oil, gas, and coal production.  But when applying it to processes where the intended output is useful work, one must be cautious.

Your comment that “nothing would live long with an EROI less than 1:1” is particularly insightful and describes well the unsustainable predicament we are in due to our dependence on fossil fuels.  We have shown that it is possible to consume those finite resources at ever-increasing rates, bringing the precipitous result of that dependence more clearly into view, at least for those who care to look. 

In the short term, an EROI less than one is perfectly acceptable in an economic sense.  For example, cheap natural gas can be squandered to produce a more valuable liquid fuel with less energy content.  This can become a particularly attractive dead end when politics establish incentives.

Renewable energy sources offer infinite energy but a finite about of power.  Fortunately, all told the renewable sources easily available to us vastly exceed our power demand.  So how do we compare two divergent approaches to the production of electricity when one is using a finite feed stock while that of the other is infinite?  Clearly the energy content of that finite fuel must be included in the accounting.

Recall earlier that I mentioned a “proper EROEI analysis” would capture the necessary detail.  Therefore, a more useful path than your classic EROI approach would be a simple ROI comparison.  While this calculation is distorted by the societal and environmental externalizations of each system, it at least it includes the all-important cost of fuel.

Willem Post's picture
Willem Post on Jan 14, 2016 2:45 pm GMT

Schalk,

I agree with your conclusions. Storing nation-scale, wind and solar energy for later use is VERY EXPENSIVE. See this URL

http://www.theenergycollective.com/willem-post/2308156/economics-batteries-stabilizing-and-storage-distribution-grids

The US has some unique advantages.

In the future, the Great Plains, from the Canadian to Mexican borders, could become the Saudi Arabia of wind energy. There would be at least 250,000 wind turbines with tall masts (higher capacity factor), at 3 MW each, producing about 250000 x 8760 x 0.35 = 2,300 TWh/y. The wind turbines would be connected with HVDC transmission lines to population centers in the eastern and western US.

Similarly, the US southwest could become the Saudi Arabia of solar energy. There would be at least 10,000 square miles of concentrated solar power plants, CSPs, with at least 10 hours of storage for continuous operation, producing 10000 x 640/10 x 8760 x 0.55 = 3,084 TWh/y. The wind turbines would be connected with HVDC transmission lines to population centers in the eastern and western.

Ultimately, the US southwest could have the equivalent of at least 3,000 CSP plants, at about 200 MW each, with at least 10 hours of storage. Those plants would provide a major part of the US electrical energy requirements, plus a major part of the peaking, filling-in and balancing of variable wind and solar energy.

Energy storage would be indispensable with increasing wind and solar energy percentages on the grid. Energy storage, “before and after the meter” would need to be built out, because it is likely:

1) The expansion of transmission systems will not proceed as quickly as required to keep up with the growth of variable, intermittent wind and solar energy, often because of cost and NIMBY concerns.

2) Demand-side management options are at best uncertain means to manage the grid and cannot be relied upon as a substitute for increased investment in energy storage.

3) Whereas fossil fuel-fired power plants can have up to several months of reserves (gas storage) or direct access to fuel (coal), there is no such strategic reserve in case of often-occurring, protracted events with insufficient wind and solar energy, and finally.

4) The US power market will not operate as one grid, leading to bottlenecks whenever inter-grid energy balancing is required. For example, the Texas grid has minor connections with the Eastern Interconnect and Western Interconnect.

TESLA Battery Systems: TESLA markets wall-hung, Powerwall units, a 7 kWh unit @ $3,000 each, and a 10 kWh unit @$3,500 each, and a Powerpack, a 100 kWh unit @ $25,000 each ($250/kWh, turnkey utility-scale $375/kWh), all of which are lithium-ion type made by Panasonic. They may be customer-owned or utility-owned.

The INSTALLED cost of the 10 kWh TESLA unit = $3,500, factory FOB + S & H + Contractor markup of about 10 percent + $2,000 for an AC to DC inverter + Misc. hardware + Installation by 2 electricians, say 16 hours @ $60/h = $7,100, or $7,140 per this URL.This shows the installed cost of the 10 kWh unit would be about 2 times the factory FOB price.

TESLA offers a 10-year warrantee for manufacturing defects, but does NOT cover performance. TESLA estimates 10% degradation in performance by year 10. There are battery charging and discharging losses, and AC to DC and DC to AC conversion losses.

 

 

 

Lewis Perelman's picture
Lewis Perelman on Jan 14, 2016 11:30 pm GMT

Lewis Perelman's picture
Lewis Perelman on Jan 14, 2016 11:31 pm GMT

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