Call or complete the form to contact us for details and to book directly with us
435-425-3414
435-691-4384
888-854-5871 (Toll-free USA)

 

Contact Owner

*Name
*Email
Phone
Comment
 
Skip to Primary Navigation Skip to Primary Content Skip to Footer Navigation
▽ Explore More ▽ Hide

US Energy Policy

US Energy Policy

Energy Policy

The incandescent lightbulb is now outlawed.[1]  This fact is a perfect metaphor for “energy policy.”  Should it be illegal in the United States to manufacture, sell, buy, and use a traditional incandescent light bulb?  Your informed answer to that question will provide deep insight into your views on hundreds of other energy policy questions.   (BTW, my answer is no, but I bet you guessed that.)

Energy is the lifeblood of our economy; it touches your life in a hundred ways each day.  Yet energy policy--the set of government rules and regulations that prescribe how energy is produced, delivered, and consumed--is a complex and even a chaotic subject.

Energy was an uninteresting subject for the average person prior to the OPEC Oil Embargo in 1973.  Oil prices had been stable at about $20 a barrel in real terms for nearly a century and electricity prices had declined from about 22 cents per kilowatt to about 13 cents from 1960 to 1973, even as consumption of electricity quadrupled from 1950 to 1973, as more and more homes and appliances used electricity and utilities became better at building large coal and nuclear plants.

But the OPEC Embargo changed everything about energy and energy policy.  Four points will illustrate this importance. 

  • President Jimmy Carter’s presidency (1976 to 1980) was dominated by energy issues which he characterized as the “moral equivalent of war.” 
  • A little more than two decades later a California governor was recalled because he botched an electricity crisis in California and Arnold Schwarzenegger was elected Governor. 
  • There is a widespread perception that the US has gone to war in the Middle East over oil issues.
  • The Pope of all people has recently declared war on climate change, most of which is laid at the feet of fossil energy.

Part of the complication in energy policy is that it must be addressed on many fronts; international, national, State, and local governments all have a role in stirring the pot. 

Many books and articles are written on very specific aspects of energy policy but most are written for other experts.  Surprisingly, few are written that cover the broad landscape of energy policy.  Even fewer of these writings take a strong market-oriented perspective; the vast majority take an interventionist approach largely for environmental and oil import reasons.  And none that I have found are addressed to the pro-market political activist who has a real job during the day and then tries to save the country in his or her spare time.  This discussion is for that heroic citizen, The Forgotten Man.

So what’s the bottom line on energy policy? 

  • First, we make energy policy much more difficult than it has to be.  Energy is a commodity just like wheat or cars or hamburgers.  Mostly, we rely on competitive markets in each of these other commodity industries to make sure that we have an adequate supply to meet the consumers’ needs at reasonable prices.  But we treat energy differently.  I venture to guess that there are only a few industries more affected by government intervention than energy.  Why is that?  Does that mean we benefit from that intervention?  Is there a better way?  The article explores these questions.
  • Second, right now energy policy is being driven by climate change.  Even if one is sympathetic to some of the claims made about climate change, many stupid actions are being taken in its name that has profoundly negative effects on energy markets. 
  • Third, oil issues get the most attention but we do not face any real danger in oil markets.  Oil trades in global markets and while there may be price fluctuations (as I write, oil is about $35 a barrel, having been over $100 in the recent past), we will never face a situation where we run out of oil.  Most countries with plentiful oil have built their economies on oil revenue and the recent drop in oil prices has created serious political problems for these countries.  They simply can’t afford not to produce oil.  But problems in oil markets can result in unnecessarily higher prices and thus we need to pay some attention to them in order to promote prosperity. 
  • Fourth and most important, electricity faces real problems that could result in catastrophic failure of the system, thus threatening not only prosperity but human life.  The major framework for electric policy was set in 1935.  That framework worked fine up to the OPEC Embargo.  Electricity can compete against oil and natural gas in many applications.  Thus adjustments were necessary to the historical framework after the Embargo.  But policymakers have only nibbled at the edges of electricity policy and have not fundamentally changed the 1935 framework.  Yet little more than additional tinkering is being done to promote an electricity industry for the 21st Century.  Many special interests are pushing and pulling on the antiquated framework for personal gain but few are fundamentally committed to a complete rethinking of the role of the electric system of the future, especially given the increasing digitalization of our economy.  And as noted above, unsound policies on climate change make electric issues even more difficult.


[1] This is a good place to make a point.  Some pointy headed academics will disagree with even this first sentence.  Technically, Congress did not “ban” incandescent bulbs in the Energy Independence and Security Act of 2007.  Rather, they set a standard that most, if not all, traditional incandescent bulbs could not achieve and established a schedule for light bulbs of different wattages to meet this standard.  So it is fair to say that Congress outlawed incandescent bulbs.  But since the accompanying Article is a synthesis of the broad topic of “energy policy” it would needlessly clutter and complicate the text to be “technically” accurate in every instance.  The size of the document would need to double and the reader would understand less of the essence of energy policy if I did not make some broad generalizations.  Nonetheless, I am sure I will receive some criticism that many of my statements are not “technically correct.”  I hope that making this point early in the article will allow for a better understanding of the content of the Article.

 

Storage: GW & GWH - ORIGINAL CONTENT

  • 6/18/24 at 06:00 AM

The two defining characteristics of electric grid-scale storage systems are the amount of power they can deliver continuously (MW, GW, TW) and the total amount of power they can deliver before they are depleted (MWh, GWh, TWh). For example, a storage system used to backup a 10 MW generator system must be able to deliver 10 MW if that generator system is not operating for any reason. If the storage system is required to provide 10 MW backup for up to 4 hours, it must have a capacity of 40 MWh. Such storage systems are typically referred to as 4-hour systems, though they are capable of providing power for a longer period of time if the demand on the system is below its rated capacity.

The most common storage system currently used in grid scale applications is the Tesla Megapack. The Megapack is classed as a short-duration storage system. The Megapack is available in both a 4-hour and a 2-hour configuration. In the 4-hour configuration it has a storage capacity of 19.6 MWh and can deliver power at a rate of up to 4.9 MW. In the 2-hour configuration, the storage capacity decreases to 10.3 MWh and the power delivery rate iincreases to 9.6 MW. The Megapack 4-hour configuration has an estimated installed cost of $8,128,870, while the 2-hour configuration has an estimated installed cost of $9,759,770. This compares with an installed cost of approximately $5,000,000 for a 5 MW utility scale solar photovoltaic array, which the Megapack could backup for 4 hours. The minimum time required to recharge the Megapack is approximately equal to the discharge time, though the recharge time might be much longer, depending on the availability of surplus power. However, the storage system must be recharged before it can be used again.

There is research underway to develop grid-scale storage systems with larger storage capacity relative to their power output, referred to as medium-duration storage systems. However, these systems are not yet defined.

The California Energy Commission (CEC) has recently funded a grant to Form Energy for construction of a long-duration storage system  The system is a 5 MW, 500 MWh system, so it could backup a 5 MW utility-scale solar array for up to 100 hours. Form Energy estimates that this storage system can achieve storage capacity of ~3 MW / 300 MWH per acre in utility-scale installations. This storage technology is an iron/air battery system, which functions based on reversible rusting. While the system is capable of delivering power over a longer time than Li-ion battery systems such as the Tesla Megapack, it also takes far longer to recharge.

The largest grid-scale storage system currently operating in the US is the Bath County Pumped Storage Station in Virginia, which has a generating capacity of ~3000 MW from 6 turbines and a storage capacity of 24,000MWh. This system could backup a 5 MW solar array for 4800 hours or a 500 MW generating system for approximately 48 hours. At full generating capacity of 3000 MW, the system could operate for approximately 8 hours.

 

Tags: Energy Storage / Batteries, Electric Power Dispatchable

How EPA's power plant rule will destroy our grid - Highlighted Article

  • 6/13/24 at 06:00 AM

 

From: Energy Talking Points by Alex Epstein - Substack

By: Alex Epstein

Date: May 22, 2024


How EPA's power plant rule will destroy our grid


EPA's rule is literally the single greatest threat to our grid in the history of electricity, since it would ban up to 1/6 of our reliable power and prevent replacements amid an electricity crisis

4 reasons EPA’s power plant rule will destroy our grid:

  1. Our grid is in crisis
  2. EV + AI demand will make things far worse
  3. EPA’s rule will shut down almost all our coal plants and prevent new natural gas replacement plants
  4. Unreliable solar and wind can't make up the difference

1. Our grid is in crisis
Premature shutdowns of reliable fossil fuel plants without sufficient reliable replacements have plunged our grid into crisis nationwide.

Most of North America is at elevated/high risk of electricity shortfalls between 2024-2028. (continue reading)

 

How EPA's power plant rule will destroy our grid

 

Tags: Highlighted Article

Transition Cause & Effect - ORIGINAL CONTENT

The ongoing transition of the US energy economy to an “all-electric everything” energy economy can be analyzed and understood as a set of causes and effects.

CAUSE: The underlying cause which precipitated the transition is the amplification of the mild global warming currently underway by political opportunists into a “crisis”, “existential threat” or “emergency”.

EFFECT: The resulting effect is the adoption of a “global” effort to achieve anthropogenic greenhouse gas emissions of “Net Zero by 2050”, primarily by replacing fossil electricity generation with wind and solar generation and existing fossil fuel applications with electric applications.

CAUSE: Installation of intermittent wind and solar generation increased investment in electricity generation, since these intermittent sources require full backup when they are unavailable.

EFFECT: Wholesale electric prices increase.

CAUSE: Intermittent renewable generation displaces generation from fossil powerplants, reducing fossil powerplant output and increasing fixed powerplant cost recovery per unit of output.

EFFECT: Wholesale electric prices increase.

CAUSE: Renewable generation output price is adjusted up based on price of the last increment of fossil generation output acquired to meet grid demand.

EFFECT: Wholesale electric prices increase.

CAUSE: Electric end use transition increases grid demand, driving increase in intermittent renewable generating capacity and requirement for full backup.

EFFECT: Wholesale electric prices increase.

CAUSE: Electric end use transition increases grid demand, driving increase in grid transmission capacity.

EFFECT: Retail electric prices increase.

CAUSE: Electric end use transition increases end use electric demand, driving increase in grid distribution capacity.

EFFECT: Retail electric prices increase.

CAUSE: Remote location of renewable generation requires grid expansion to connect the larger number of smaller generators.

EFFECT: Retail electric prices increase.

CAUSE: Resistance to increased fossil generation capacity as renewable backup requires addition of electricity storage and generating capacity. Storage cost is 2.5 times the cost of natural gas combined cycle generation per kW and approximately 30 times the cost per kWh.

EFFECT: Wholesale electric prices increase.

CAUSE: Fossil generation capacity is shuttered as the result of government edict or unsustainable economics and is replaced by additional renewable generation plus storage sufficient to render the intermittent generation dispatchable. Undepreciated fossil generation asset value is securitized and recovered through rates.

EFFECT: Wholesale electric prices increase.

CAUSE: Intermittent renewable generation life expectancy is approximately half of fossil generation life expectancy, requiring more rapid depreciation.

EFFECT: Wholesale electric prices increase.

CAUSE: Electricity storage life expectancy is approximately one quarter of fossil generation life expectancy, requiring more rapid depreciation.

EFFECT: Wholesale electricity prices increase.

SUMMARY: Numerous aspects of the transition to an “all-electric everything” energy economy contribute to an increase in wholesale and retail electric rates, rather than to the promised reductions which were supposed to result from the conversion to renewable generation. The magnitude of the increases might be reduced in the future if electricity storage costs can be reduced. However, the proponents of the transition appear unwilling to wait for the evolution of storage technology.

 

Tags: Green Energy Transition, Net Zero Emissions, Energy Costs

Net Zero CO2 Emissions: A Damaging and Totally Unnecessary Goal - Highlighted Articles

  • 6/6/24 at 06:00 AM

 

From: Roy Spencer, Ph. D.

By: Roy W. Spencer, Ph. D.

Date: April 18 & 23, 2024

 

Net Zero CO2 Emissions: A Damaging and Totally Unnecessary Goal


Unnecessary Net Zero, Part II: A Demonstration with Global Carbon Project Data


The goal of reaching “Net Zero” global anthropogenic emissions of carbon dioxide sounds overwhelmingly difficult. While humanity continues producing CO2 at increasing rates (with a temporary pause during COVID), how can we ever reach the point where these emissions start to fall, let alone reach zero by 2050 or 2060?

What isn’t being discussed (as far as I can tell) is the fact that atmospheric CO2 levels (which we will assume for the sake of discussion causes global warming) will start to fall even while humanity is producing lots of CO2.

Let me repeat that, in case you missed the point:

Atmospheric CO2 levels will start to fall even with modest reductions in anthropogenic CO2 emissions.

Why is that? The reason is due to something called the CO2 “sink rate”. It has been observed that the more CO2 there is in the atmosphere, the more quickly nature removes the excess. The NASA studies showing “global greening” in satellite imagery since the 1980s is evidence of that.

Last year I published a paper showing that the record of atmospheric CO2 at Mauna Loa, HI suggests that each year nature removes an average of 2% of the atmospheric excess above 295 ppm (parts per million). The purpose of the paper was to not only show how well a simple CO2 budget model fits the Mauna Loa CO2 measurements, but also to demonstrate that the common assumption that nature is becoming less able to remove “excess” CO2 from the atmosphere appears to be an artifact of El Nino and La Nina activity since monitoring began in 1959. As a result, that 2% sink rate has remained remarkably constant over the last 60+ years. (By the way, the previously popular CO2 “airborne fraction” has huge problems as a meaningful statistic, and I wish it had never been invented. If you doubt this, just assume CO2 emissions are cut in half and see what the computed airborne fraction does. It’s meaningless.)

Here’s my latest model fit to the Mauna Loa record through 2023, where I have added a stratospheric aerosol term to account for the fact that major volcanic eruptions actually *reduce* atmospheric CO2 due to increased photosynthesis from diffuse sunlight penetrating deeper into vegetation canopies: (continue reading)

 

Net Zero CO2 Emissions: A Damaging and Totally Unnecessary Goal


Unnecessary Net Zero, Part II: A Demonstration with Global Carbon Project Data

Tags: Highlighted Article

A Rational Transition - ORIGINAL CONTENT

The Administration has set the nation on a rapid transition to an “all-electric everything” energy economy powered predominantly by intermittent renewable energy. The goal is to complete this transition by 2050. There is significant uncertainty regarding the wisdom and necessity of achieving this goal, the target date for achieving it is arbitrary and the approach currently being pursued to achieve it is irrational.

However, if we stipulate that the transition is necessary, there is a rational path to pursuing it, though it is extremely unlikely that the transition would be complete by 2050. Pursuing this rational path begins with the acknowledgement that a reliable electric grid powered predominantly by intermittent renewable generation would require a combination of short-, medium- and long-duration storage infrastructure capable of storing approximately 25% of annual generation.

The first step in the process would be to terminate all subsidies, incentives and preferences for deployment of renewable generation. Wind and solar are relatively mature technologies. Their costs have been reduced dramatically and their promoters contend that they are already generating the cheapest electricity. There are more critical uses for the funds which are currently dedicated to these subsidies and incentives.

The second step in the process would be to terminate all subsidies, incentives and preferences for deployment of short-duration storage. Lithium-ion short-duration storage systems are commercially available and are being installed worldwide. The funds currently dedicated to these subsidies would be redirected to research, development, demonstration and deployment of medium- and long-duration storage technology.

The next step in the process would be to eliminate the current storage deficit which resulted from the installation of intermittent renewable generation without the storage required to render this generation dispatchable. The required storage capacity is approximately 115,000 GWH.

The next step in the process would be a requirement that all new intermittent renewable generation connected to the grid include sufficient storage capacity to render the generation dispatchable.

The next step in the process would be to delay any forced closures of coal generation facilities until sufficient dispatchable renewable generating capacity is installed and operating within the region currently served by those plants.

The next step in the process would be to delay any forced closures of natural gas generation facilities until sufficient dispatchable renewable generating capacity had been installed to meet the anticipated load growth in the region as well as replacing the existing natural gas generating capacity.

The funds currently used to subsidize and incentivize wind and solar generation should be redirected to research, development, demonstration and deployment of Dispatchable Emission Free Resources (DEFRs) for connection to the grid and for use as standby power systems for uninterruptible loads.

The time required for this transition is difficult to estimate because medium- and long-duration storage systems and DEFRs do not currently exist commercially and the time required for their RDD&D is uncertain. The time required for installation of the required generation and storage infrastructure is also uncertain because of the numerous delays encountered in infrastructure development projects. The time required for conversion of numerous industrial processes to electric power is uncertain because the required technology does not exist or is in its infancy.

Finally, completion of the project might well be delayed by the ability of the economy to fund the required new generation, storage, transmission and distribution infrastructure, including “last mile” upgrades to residential and commercial service transformers, service lines, and power panels..

 

Tags: Electric Power Dispatchable, Energy Storage / Batteries, Green Energy Transition

Irrational Transition - ORIGINAL CONTENT

The United Nations and the leaders of the developed nations have declared that the continued anthropogenic emissions of greenhouse gases into the atmosphere represent an existential threat to humanity and must cease. They have established a goal of achieving net zero greenhouse gas emissions by 2050 and have initiated a variety of actions intended to achieve that goal. They contemplate a transition to “all-electric everything”.

The apparent enthusiasm of the UN and the governments of the developed nations for Net Zero by 2050 is not shared by the developing and not-yet-developing nations, which place higher priority on economic development, with little regard for the resulting greenhouse gas emissions. That assures that, even if the developed nations achieved their net zero goals, the globe would not reach net zero by 2050.

However, it appears extremely unlikely that the developed nations would achieve net zero emissions by 2050. The transition could only be achieved with a combination of massive expenditures, successful commercialization and implementation of currently non-existent technology and processes, elimination of the government-imposed “red tape” which delays project approvals and construction schedules, societal acceptance of the resulting upheaval and an enormous amount of good luck. Expecting to achieve this transition by 2050 is not rational. It is also not necessary.

The transition has begun by providing extremely generous government subsidies and incentives to encourage the installation of intermittent renewable wind and solar electric generation and the sale and use of electric vehicles. However, there has been very little attention paid to the electricity storage infrastructure necessary to allow smooth integration of the intermittent renewable generation into a reliable grid. There has been no effort to demonstrate that an intermittent renewable plus storage supplied grid could be reliable. There has been limited attention paid to the utility and reliability of electric vehicles, or to the development of the fueling infrastructure necessary to adequately support them.

There is growing attention being paid to various societal sacrifices which would be a necessary part of the transition, including personal and business travel restrictions, personal consumption of goods and services restrictions and dietary changes. There is also active promotion of the concept of “15-Minute” cities and discussion of population control, though there is very little discussion of how it would be accomplished.

A rational approach to a transition of this magnitude would be based on technologies and processes which have been thoroughly tested and demonstrated and have shown that they can be implemented economically while improving quality of life. This is clearly not the case today. Rather, the controlling bureaucracies: HOPE that sufficient renewable generating capacity can be manufactured and installed timely; HOPE that economical short-term, medium-term and long-term storage technology can be developed, manufactured and installed timely; HOPE that the combination of renewable generation plus storage can successfully replace coal and natural gas generation; HOPE that the new electric equipment and processes required to replace existing fossil fueled equipment and processes can be developed and installed timely; HOPE that the required expansion of the grid, including the “last mile” can be completed timely; HOPE that the issues of electric vehicle utility and charging can be resolved timely; and HOPE that the national economies survive the process.

Regrettably, HOPE is not a strategy and relying on HOPE is not rational.

 

Tags: Green Energy Transition, Net Zero Emissions

Head-On Collision - ORIGINAL CONTENT

The US energy industry is subject to intense regulation and oversight at both the federal and state levels. Federal regulation is provided by the Federal Energy Regulatory Commission (FERC). National oversight of the electric energy industry is provided by the North American Electric Reliability Corporation (NERC), which is itself overseen by FERC. State regulation is provided by individual state utility commissions, which share information through the National Association of Regulatory Utility Commissioners (NARUC). State oversight is provided by individual state consumer advocates or consumer counsels, which share information through the National Association of State Utility Consumer Advocates (NASUCA).

While each of these agencies and organizations has its own unique mission, their missions share several common elements.

FERC: FERC's Mission: Assist consumers in obtaining reliable, safe, secure, and economically efficient energy services at a reasonable cost through appropriate regulatory and market means, and collaborative efforts.

NERC:  Our mission is to assure the effective and efficient reduction of risks to the reliability and security of the grid.

NARUC: Our mission is to serve the public interest by improving the quality and effectiveness of public utility regulation. Under state laws, NARUC's members have an obligation to ensure the establishment and maintenance of utility services as may be required by law and to ensure that such services are provided at rates and conditions that are fair, reasonable, and nondiscriminatory for all consumers.

NASUCA: NASUCA’s members are designated by the laws of their respective jurisdictions to represent the interests of utility consumers before state and federal regulators and in the courts.

FERC and NERC have both warned that the energy transition being pushed by the current Administration, as it is currently being pursued, threatens the reliability, safety, security and economic efficiency of the electric utility grid. Their primary expressed concerns are the rapid decommissioning of dispatchable coal and natural gas powerplants and the slower pace of commissioning of renewable generation capacity, which is resulting in a decrease in the capacity reserve margin on peak as well as the ability of dispatchable generation to respond to renewable intermittency.

However, they will soon be required to focus on the growing share of grid generating capacity which is intermittent and non-dispatchable. The grid requires the ability to dispatch resources as required to meet contemporaneous demand. As the intermittent renewable share of generating capacity increases, it will be essential to add dispatchable storage capacity to the grid to maintain reliability. However, grid scale storage is currently extremely expensive and duration limited. Storage systems capable of discharging large quantities of electricity over prolonged periods are not currently available.

State utility commissions are just beginning to respond (react) to the economic impacts of the energy transition. Utilities have begun filing rate increase requests tied to the costs of the transition. Commissions in several East Coast states have encountered requests for increases in contract prices for electricity from offshore wind projects. Several offshore wind projects have been cancelled and others have been rebid at prices as much as 50% higher than the original contract prices. The contract prices being sought for offshore wind are significantly above the current wholesale price of electricity; and, in many cases, above the current retail prices of electricity.

The energy transition faces a conflict with the “fair and reasonable” rates focus of NARUC and its members. However, this conflict appears likely to result in a head-on collision as state regulators are faced with the need to correct the current storage deficit associated with the existing renewable generating capacity on the grid and the massive costs of implementing sufficient storage on the grid to assure continued reliability as the share of intermittent renewable generation on the grid increases.

The state commissions will also be faced with the necessity of shifting from 40-year straight line depreciation of most utility assets to depreciation over the shorter expected lives of wind turbines, solar collectors and electricity storage infrastructure.

The state utility commissions will also soon be faced with rate increase requests tied to the expansion of the grid required to accommodate the Administration’s “all-electric everything” goal, as well as requests for the securitization of undepreciated investments in coal and natural gas powerplants required to cease operation to comply with Net Zero mandates.

"If there is light at the end of this tunnel, it might well be the headlight of an oncoming train." - Slavoj Zizek

 

Tags: Regulation, Green Energy Transition, Electric Power Dispatchable

False Energy Transition: The View from Australia (Nick Cater, Menzies Research Centre) - Highlighted Article

  • 5/16/24 at 06:00 AM

 

From: Master Resource

By: Robert Bradley Jr.

Date: April 24, 2024


False Energy Transition: The View from Australia (Nick Cater, Menzies Research Centre)
 

“Previous energy transitions adopted energy sources of greater density and efficiency than those they replaced. Those advantages became a natural incentive for their adoption. In the current ‘transition’, the process is reversed unless we are prepared to countenance the mass use of nuclear technology.” – Nick Cater, below

The political “energy transition” has predictably violated comparative energy physics and thus consumer preferences–and best industry practices. A re-look at the failing, impossible “energy transition” was penned by Nick Cater, senior fellow at Menzies Research Centre in Australia. [1] His analysis deserves wide attention, as does his other work at the energy-centric Reality Bites.

 


As the First Fleet vessels, propelled by wind and muscle, made their way to Australia, the last energy transition was making headway in Europe and the United States. The first commercial steamboat completed a successful trial on the Delaware River in New Jersey on August 20, 1787, heralding the arrival of a more powerful and efficient source of energy.


The ability to turn energy-dense fossil fuel into usable energy would be the key to accelerating economic growth in Australia, which began with European settlement. By the time the colony of New South Wales marked a century of settlement in 1878, steam-powered ocean-going vessels were starting to be constructed from steel. Frederick Wolseley was demonstrating a prototype set of steam-driven mechanical shears. This Australian invention secured Australia’s dominance in the supply of wool to steam-powered woollen mills on the other side of the world. (continue reading)

 

False Energy Transition: The View from Australia (Nick Cater, Menzies Research Centre)

 

Tags: Highlighted Article

All-Electric Everything - ORIGINAL CONTENT

The Administration’s All-Electric Everything goal would require the addition of approximately 4,800 GW of storage supported rating plate capacity renewable generation with a capacity factor of approximately 30%, depending on the ultimate proportion of wind and solar generating capacity. The EIA Annual Energy Review projects that solar would provide approximately twice the electricity provided by wind generation. For purposes of this analysis, we will assume 3,200 GW of additional solar generation and 1,600 GW of new wind generation.

The installed cost of premium solar photovoltaic collectors is approximately $1.06 per Watt. Therefore, the estimated installed cost of 3,200 GW of premium solar collectors would be $3.4 trillion. ($1.06/W * 1,000,000,000 W/GW * 3,200 GW).

The installed cost of utility-scale wind turbines is approximately $1,500,000 per MW. Therefore, the estimated installed cost of 1,600 GW of wind generation would be $2.4 trillion. ($1,500,000/MW * 1,000 MW/GW * 1,600 GW).

Therefore, the estimated total installed cost of the additional 4,800 GW of renewable generating capacity would be approximately $5.8 trillion, or approximately $220 billion per year through 2050. These costs do not include the cost of the land required for installation, the cost of tripling the capacity of the existing utility grid, or the cost of connecting the generation systems to the grid.

This additional intermittent renewable generation would require storage support to ensure grid reliability. The additional generation would produce approximately 12,600 TWH per year (4,800 GW * 0.30 CF * 8760 hrs/yr). The storage required for support of this intermittent renewable generating capacity would be approximately 3,200 TWH. (12,600 TWH * 0.25).

The installed cost of the storage capacity, restricted to a maximum charge of 80% to extend battery life, would be approximately $414 trillion, [(3,200 TWH * 1,000,000 MWH/TWH) * 25 * $8,128,870) /15.7 MWH] or approximately $16 trillion per year through 2050.

There are expected to be lower cost storage options, some with longer storage duration, in the future. NREL estimates current 4-hour battery costs at $500 per kWh, which is projected to drop to approximately $250 per kWh by 2050. The Tesla Megapack stores 19,600 kWh at an installed cost of approximately $415 per kWh. Form Energy claims that their iron-air battery could be sold for 10% of the price of a lithium battery such as the Tesla Megapack, though their battery is not yet available commercially. However, even if this or other lower cost, longer duration batteries became commercial immediately, they would reduce the projected incremental cost of storage for the all-electric transition from $414 trillion to $41 trillion.

The installed cost of the storage required to support intermittent renewable generation is currently approximately 70 times the cost of the generation, though different storage technology could potentially reduce the cost of storage to 7 times the cost of the generation. Regardless, storage is clearly the most expensive aspect of a renewable plus storage generation system. This cost has been ignored or trivialized for far too long.

 

Tags: Green Energy Transition, Electric Power Dispatchable, Energy Storage / Batteries

DECARBONIZING THE U.S. ECONOMY BY 2050 - Highlighted Article

  • 5/9/24 at 06:00 AM

From: U.S. Department of Energy

Date: April, 2024


DECARBONIZING THE U.S. ECONOMY BY 2050
A National Blueprint for the Buildings Sector


EXECUTIVE SUMMARY

Residential and commercial buildings are among the largest sources of carbon dioxide and other greenhouse gas (GHG) emissions in the United States, responsible for more than one-third of total U.S. GHG emissions. There are nearly 130 million existing buildings in the United States, with 40 million new homes and 60 billion square feet of commercial floorspace expected to be constructed between now and 2050. Today, most buildings consume large amounts of energy and cause significant climate pollution to meet our basic needs. Buildings account for 74% of U.S. electricity use and building heating and cooling drives peak electricity demand. Moreover, buildings are where electric vehicles (EVs), solar, storage, heat pumps, water heaters, and other distributed energy resources integrate with the electricity system. Consequently, the buildings sector will play a key role in achieving economywide net-zero emissions by 2050.

People spend 90% of their time in buildings and expend substantial sums of money on building energy costs—upwards of $370 billion annually. One in five American households is behind on energy bill payments, with people in economically marginalized communities more likely to face energy insecurity due to high energy costs. Such communities also bear the brunt of healthharming pollution emitted from burning fossil fuels and safety risks from substandard building conditions. Transitioning buildings to clean energy sources and reducing overall energy consumption will therefore address not just climate risks but also the physical and financial well-being of all Americans. (continue reading)

 

DECARBONIZING THE U.S. ECONOMY BY 2050
A National Blueprint for the Buildings Sector

 

Tags: Highlighted Article

Economic Reality - ORIGINAL CONTENT

The energy transition envisioned by the current US Administration is an enormous financial endeavor. It would increase the current US electricity sector investment in generation, transmission and distribution facilities from approximately $150 billion per year to approximately $250 billion per year through 2050, roughly tripling industry capitalization to approximately $6 trillion.

The transition would also require the electricity sector to invest between $8 – 80 trillion per year over the period in electricity storage facilities, depending on the ultimate cost of electricity storage infrastructure.

It is difficult to imagine that an electric utility industry with a capitalization of approximately $2 trillion, currently investing approximately $150 billion annually, could increase annual investment by 50X through 2050, no less by 500 times.

It is inconceivable that this level of increased investment in the electric grid could result in the promised reduction in customer electricity cost, especially considering the anticipated securitization of existing, functional and not fully depreciated coal and natural gas generation assets and the far more rapid depreciation of the new generating and storage assets.

Note also that, over the 26-year period to 2050, much of the renewable generation equipment and storage facilities installed early in the transition would begin to require replacement, further increasing investments.

The replacement of fossil end use equipment would largely be the responsibility of the equipment owners and much of the equipment would be replaced with electric equipment at the end of its useful life, so the incremental societal cost of the equipment replacement is not possible to calculate.

The above information is in the public domain and is known by US DOE, FERC and the electric utilities.

The often-repeated promise of cheaper renewable electricity is a fraudulent fantasy.

It is difficult to imagine how a nation with an approximate $28 trillion GDP and a $30 trillion national debt could increase investment in its energy sector alone by $8 - 80 trillion per year through 2050. It is also difficult to imagine how such a nation could justify continued long-term subsidies and incentives funded with increasingly expensive borrowing.

It is also difficult to imagine how US industry would be able to remain competitive in the global economy in competition with industry in China, India, Indonesia and other nations continuing to rely on fossil fuels for their energy needs. Industries are already reducing or terminating production in the UK and Germany, which are further along in their energy transitions than the US.

 

The urge to save humanity is almost always a false front for the urge to rule.
H. L. Mencken

 

Tags: Electric Utilities, Fossil Fuel Elimination / Reduction, Green Energy Transition

How to Destroy The Myth of Cheap Wind and Solar - Highlighted Article

  • 5/2/24 at 06:00 AM

 

From: Energy Bad Boys - Substack

By: Isaac Orr and Mitch Rolling

Date: March 30, 2024


How to Destroy The Myth of Cheap Wind and Solar


If Wind and Solar Are So Cheap, Why Do They Make Electricity So Expensive?


Have you ever wanted to destroy the arguments claiming that wind and solar are the cheapest forms of energy, but you weren’t sure how to do it? Fear not, dear reader; the Energy Bad Boys have you covered!


The Myth of Cheap Wind and Solar

Wind and solar advocates often cite a metric called the Levelized Cost of Energy (LCOE) to claim that these energy sources are cheaper than coal, natural gas, and nuclear power plants.

However, these claims, which are already tenuous due to rising wind and solar costs, ignore virtually all of the hidden real-world costs associated with building and operating wind turbines and solar panels while also keeping the grid reliable, including:

  • Additional transmission expenses to connect wind and solar to the grid;
  • Additional costs associated with Green Plating the grid;
  • Additional property taxes because there is more property to tax;
  • “Load balancing costs,” which include the cost of backup generators and batteries;
  • Overbuilding and curtailment costs incurred when wind and solar are overbuilt to meet demand during periods of low wind and solar generation and are turned off during periods of higher output to avoid overloading the grid;
  • These comparisons also ignore the cost differential between low-cost, existing power plants and new power plants.

Add all of these factors together, and you have a recipe for soaring electricity prices due to the addition of new wind, solar, and battery storage on the electric grid.

To remedy this situation, we developed a model to calculate the levelized cost of intermittency (LCOI), which is the additional costs borne by the entire electric system as ever-growing levels of intermittent wind and solar generation are incorporated onto the electric grid. (continue reading)

 

How to Destroy The Myth of Cheap Wind and Solar

 

Tags: Highlighted Article

All-Electric Storage - ORIGINAL CONTENT

The US Administration has established a goal of transitioning all energy end uses in the economy to electric end uses by 2050. This would be a massive undertaking, requiring the application of currently non-existent technology, particularly in industrial and transportation end uses.

The US currently consumes approximately 4,200 TWH of electricity each year with a generation fleet of approximately 1,200 GW. The transition to all-electric everything would require an increase in electric generation to approximately 13,000 TWH from a storage supported predominantly intermittent generation fleet of approximately 6,000 GW with a capacity factor of approximately 30%, depending on the mix of wind and solar in the generation fleet.

A recent paper, summarized by its primary author, concludes that a predominantly intermittent renewable powered electric grid would require storage equal to approximately 25% of annual generation to assure reliability. Thus, the US all-electric everything grid would require electricity storage capacity of approximately 3,300 TWH. However, research suggests that battery life could be extended by operating the batteries between 20% and 80% of rated capacity. The batteries would be expected to experience charge below 20% only rarely, so this condition could be safely ignored. However, to avoid charging the batteries to above 80% of their rated capacity while assuring adequate capacity, total electric storage capacity would be increased by 25%, to approximately 4200 TWH.

The primary battery storage system currently being installed for grid level storage is the Tesla Megapack, which stores 19.6 MWH deliverable at a rate of 4.9 MW over a 4-hour period. Restricting the Megapack to a maximum 80% charge would reduce its storage capacity to approximately 15.7 MWH. Under these conditions, satisfying the storage requirements of the all-electric everything grid would require approximately 270 million Megapacks at an approximate installed cost of $2.2 quadrillion.

There are expected to be lower cost storage options, some with longer storage duration, in the future. NREL estimates current 4-hour battery costs at $500 per kWh, which is projected to drop to approximately $250 per kWh by 2050. The Tesla Megapack stores 19,600 kWh at an installed cost of approximately $415 per kWh. Form Energy claims that their iron-air battery could be sold for 10% of the price of a lithium battery such as the Tesla Megapack, though their battery is not yet available commercially. However, even if this or other lower cost, longer duration batteries became commercial immediately, they would only reduce the projected cost of storage for the all-electric transition from $2.2 quadrillion to $220 trillion.

The all-electric transition is the most challenging aspect of the Administration’s Net Zero goal, since it requires a rough tripling of US electricity generation and also requires twice as much storage as the transition from fossil to renewable generation in the electricity sector. This transition has already begun, with the major promotion and incentivization of electric vehicles and public charging stations for those vehicles. Fortunately, it is to occur over a period twice as long as the electricity sector transition.

 

Tags: Electricity Consumption, Electric Power Reliability, Energy Storage / Batteries

Which Power Source is Best - Highlighted Article

  • 4/25/24 at 06:00 AM

 

From: Watts Up With That

By: Roger Caiazza

Date: March 28, 2024


Which Power Source is Best


Bud’s Offshore Energy blog highlighted a new national energy report card that is of interest to readers here.  According to the Mackinac Center press release the report ranks energy sources by ranking eight key energy resource types “based on their ability to meet growing demand for affordable, reliable, and clean energy generation”.  The report concludes that “natural gas and nuclear power lead the rest of the class in generating clean and affordable energy”.

Jason Hayes and Timothy G. Nash co-authored this report from Northwood University’s McNair Center for the Advancement of Free Enterprise and Entrepreneurship and the Mackinac Center for Public Policy.  The Mackinac Center for Public Policy is a nonprofit research and educational institute that advances the principles of free markets and limited government.

Methodology

The report summarizes the scoring methodology:

Bottom Line Up Front: Each ranking area graded the energy resource on a scale of 1 to 10. If an energy source performed poorly, it received a 1, if it performed well, it received a 10.

The scores in each section were totaled and broken down from 1 to 50. The energy source was given a final letter grade of A to F based on its score out of 50. The grading system results in a comparative ranking that describes the energy resource as excellent (90-100 /A-range), very good (80-89/B-range), average (70-79/C-range), poor (60-69/D-range), and Failure (59 or below/F).  This methodology is roughly based on the American Society of Civil Engineers’ methodology described in the annual “A Comprehensive Assessment of American’s Infrastructure: 2021 Report Card for America’s Infrastructure” document.

The score card evaluated each energy source for five ranking areas:

  1. Capacity and Reliability: We estimated the capability of this energy source to produce sufficient energy to meet demand. We also considered how plans to maintain existing (or build new) infrastructure and capacity will meet growing energy demand.
  2. Environmental/Human Impact: We asked what are the environmental impacts, the human rights, or other labor issues associated with using this energy source.
  3. Cost: We asked how the energy source competes with other energy sources in terms of pricing.
  4. Technology and Innovation: We asked what technologies are used and what new technologies are being developed for this energy source.
  5. Market feasibility: We considered whether the energy source relies on free-market forces to supply energy to the public. To what extent do subsidies and/or government mandates drive its adoption and use?


The report includes recommendations for policies that could be implemented to improve this sector’s performance. (continue reading)

 

Which Power Source is Best

 

Tags: Highlighted Article

No Gas Storage - ORIGINAL CONTENT

In a summary of a recent peer-reviewed paper, the principal author stated that an electric grid predominantly powered by intermittent renewables such as wind and solar would require storage approximately equal to 25% of annual generation to be reliable. Other studies have reported similar results.

US natural gas powerplants produced approximately 1,800,000 GWH of electricity in 2023. The Administration has announced a goal of eliminating natural gas electric generation by 2035. Achieving this goal would require installation of approximately 685 GW of wind and solar rating plate generation, depending on the percentages of wind and solar generation.

Based on the Fekete paper, the US would also require a total of approximately 450,000 GWH of additional electricity storage capacity as the result of the elimination of natural gas generation. The primary battery storage system currently being installed for grid level storage is the Tesla Megapack, which stores 19.3 MWH deliverable at a rate of 4.9 MW over a 4-hour period. Utilizing Tesla Megapacks to support the intermittent wind and solar generation installed to replace US natural gas powerplants would require approximately 23,300,000 units at a current installed cost of $8,128,870 per unit, for a total installed cost of approximately $190 trillion.

Research suggests that battery life can be extended by operating the batteries between 20% and 80% of full charge. Grid scale batteries would be expected to operate below 20% of full charge very rarely, so the lower limit can essentially be ignored. However, limiting the batteries to a maximum charge of 80%, while maintaining necessary electricity storage would require increasing the installed battery capacity by 25%, at an installed cost of approximately $48 trillion, increasing the total battery system installed cost to approximately $238 trillion. (Note: These costs do not include the land required for installation or the cost of grid connection.)

The US currently has an electricity storage deficit of approximately 140,000 GWH. Fossil fueled generation currently provides support for the existing wind and solar generation in the absence of this storage and there is growing concern regarding grid capacity margins during peak demand periods. Therefore, as coal and natural gas powerplants are decommissioned, it would be essential that the current storage deficit be eliminated as well as installing the additional storage required to support the intermittent generating capacity which would provide the generation previously provided by the coal and natural gas powerplants. This would require the installation of approximately 47 million Tesla Megapacks (or equivalent). Currently, production capacity does not exist to meet this demand over the next 11 years.

Also, as coal and natural gas power plants are decommissioned, there will be a growing need for long-duration storage to support the grid through seasonal variation in both wind and solar generation. The only current long-duration systems are pumped hydro facilities. However, it is unlikely that significant additional pumped hydro capacity will be installed in the US because of geographic limitations and public resistance.

 

Tags: Natural Gas, Electric Power Generation, Energy Storage / Batteries, Fossil Fuel Elimination / Reduction
Search Older Blog Posts