MSE News: Guest Comment - Why are energy prices increasing?

zeupater

grahamc2003 wrote: »

..... A shortage of generation doesn't mean a shortage of capacity (although it's indicative). Indeed, in the future, it's very likely we will have lots of windmill capacity, but only a little or no generation from that capacity at times, leading to a shortage of generation. The only useful capacity to the grid is schedulable capacity (i.e. the grid can instruct that capacity to generate). Obviously, that's not the case with wind (or solar come to that). You're not alone with this lack of understanding - I think if politicians realised the difference, then we wouldn't be subsidising this massive wind energy build.

Hi

I always find that a very interesting point ......

As I understand it all unschedulable renewable capacity which is installed makes absolutely no difference to the total national generation capacity in order to ensure that there is always enough schedulable capacity to meet demand. The way this is done is quite extraordinary and has obviously been concocted in order to placate the 'green' lobbyists and show renewables as a contibuting source ... for every Watt of unschedulable capacity added, a reversing entry is taken from the available schedulable capacity to ensure supply - In a simplistic way, it works like this ...

Before Unschedulable Renewable capacity ...
(Legacy Capacity)-(Demand) = (Spare Capacity)

And After ....
(Legacy Capacity-Renewables Capacity)+(Renewables Capacity)-(Demand) = (Spare Capacity)

... It keeps everyone happy, the lights don't go out, the 'greens' think that they are actually making a difference and the accountants have their double-entry bookkeeping, but putting some random figures into the equation makes the effect on total capacity of all of the investment into unschedulable sources very clear ...

Before .... 100-80=20
After .... (100-10)+10-80=20
Result .... 20-20=0 !!

... which is absolutely no difference to the overall generating capacity, apart from the greens being able to say that x% of generating capacity is from renewables ...

Simple, but it took quite some reading to see this ....
:eek:
HTH
Z

magyar

zeupater wrote: »

But you can, and beyond that you can even have the ability for the grid to control high consumption/low priority devices within properties in order to smooth demand at peak-load times without the householder being aware that this is happening ....

See .... http://en.wikipedia.org/wiki/Smart_grid

HTH
Z

I don't disagree that a smart grid is possible; as for example is using electric vehicles as storage devices.

But not without massive investments.

magyar

grahamc2003 wrote: »

You realise your statement above is self-contracdictory?

You say either everyone gets electricity or no one gets it, yet then go on to say that there'l be selective balckouts, which means some will get electricity while others don't.

That's the end of that point.

I was trying to pre-empt the pedantic point that you wouldn't take out the whole grid, just part of it. You surely don't disagree that electricity has to be used at the moment of generation and therefore supply and demand is irrelevant?

grahamc2003 wrote: »

Then other point is that you don't seem to know the difference between generation and capacity. A shortage of generation (which is coming, no doubt about that) will result in National grid engineers cutting power to major areas. A shortage of generation doesn't mean a shortage of capacity (although it's indicative). Indeed, in the future, it's very likely we will have lots of windmill capacity, but only a little or no generation from that capacity at times, leading to a shortage of generation. The only useful capacity to the grid is schedulable capacity (i.e. the grid can instruct that capacity to generate). Obviously, that's not the case with wind (or solar come to that). You're not alone with this lack of understanding - I think if politicians realised the difference, then we wouldn't be subsidising this massive wind energy build.

I'm well aware of the difference thanks, as I'm sure are DECC, because contrary to popular belief these things do get considered.

An excess of 20% capacity of peak period demand does NOT mean 20% intermittent generation can be accomodated.

Obviously (well, obviuous to most), there is always plant under maintenance, faults and otherwise unavailable to generate. At any time, there'll be a certain percentage of schedulable capacity Unavilable, so the grid never has the total installed capacity as generation.

Again, I was trying to simplify the point here. Clearly you have to allow for outage of other plants (as indeed you have to consider scheduled maintenance on wind farms).

Secondly, neither capacity nor generation is significant for correcting for the most critical factor of intermittant generation. The factor which does is 'reserve', which, in the case of primary reserve, is stored energy within those stations with reserve duty avaliable instantly (in fact, the power increase is automatic). This is very expensive, and is what has to be increased as more wind is connected to the grid, and I've never seen a report of wind finances taking into account this extra expensive factor. (It's a hidden subsidy to wind which I tried to explain to you before - I think you called me a liar for doing so).

This is not a subsidy for wind, it doesn't matter how many times you write the words down, it won't make it true. Having wind on the system will increase costs: no-one has ever denied that. But this is not money that wind farms will receive.

What I called you a liar for was continually stating, even in face of actual evidence to the contrary, was that wind farms 'receive subsidies whether they generate or not', which is untrue. Let me repeat absolutely clearly. If a wind farm never generated any electricity, it would never receive a penny in subsidies*.

* some early wind farms received capital grants, but these were not common and no longer offered.

zeupater

magyar wrote: »

..... You surely don't disagree that electricity has to be used at the moment of generation and therefore supply and demand is irrelevant? ....

Hi

The above question as posed is based on a false premise ..... If supply & demand was to be irrelevant then there would be absolutely no reason to have a different tariff at night to encourage 'off peak' usage. Overnight, supply is high, demand is low thus creating conditions which favour the buyer, hence a low price/unit. This is typical supply & demand scenario .....

Z

grahamc2003

zeupater wrote: »

Hi

I always find that a very interesting point ......

As I understand it all unschedulable renewable capacity which is installed makes absolutely no difference to the total national generation capacity in order to ensure that there is always enough schedulable capacity to meet demand.

Z

Firstly, let me thankyou for giving a logical reply to mine which makes sense and not the alice-in-wonderland replies I'm used to on this thread.

Your point is correct - to ensure the grid can meet peak demand, it must ensure there is sufficient schedulable capacity (which is the maximum demand plus contingency).

Non-scheduable generation (such as wind and solar) therefore are of no consequence to meeting peak demand. No schedulable generation (coal, oil, Nuclear, hydro, pumped storage, gas etc) can be retired however many windfarms are built.

If you decommision 1GW of coal, then that has to be replaced, for the same system security, with 1GW of schedulable generation. If 1000 1MW windmills were built, they would still count as an addition 1GW of capacity, but, because it is unschedulable, it would not be a replacement for the 1gw retired coal plant. (Not by any stretch of the imagination.) Even apart from the inability to scedule the wind turbines, the amount of generation produced would be between 1/5th and 1/3rd of the coal plant, and of course that generation would be at random times and sometimes when very inconvenient.

zeupater wrote: »

Hi

The way this is done is quite extraordinary and has obviously been concocted in order to placate the 'green' lobbyists and show renewables as a contibuting source ... for every Watt of unschedulable capacity added, a reversing entry is taken from the available schedulable capacity to ensure supply - In a simplistic way, it works like this ...

HTH
Z

Not sure of this bit. Any installed wind capacity is simply added on to the existing capacity on the grid. (The 'capacity' for these discussions can simply be viewed as the theroetical maximum power of the plant, although in practice there are several measures of capaity).

I think you may be talking about generation, whereby say if there's a 20GW demand (matched of course by 20GW of supply), then if the wind stops blowing on a windfarm, and 100MW are lost, then simply 100MW of schedulable capacity replaces it (in fact, it will come from primary reserve initially, then later from grid engineers instructing another station to add another 100MW under certain complicated cirsumstances, or may just becaome part of the noise). If the wind then starts blowing again, and an extra 100MW of wind comes online, then the reverse will happen. (remember it's much more complicated in reality because demand is varying all the time on top of this uncontrollable element of the supply). Any mismatch between supply and demand will manifest itself with the difference changing the angular kinetic energy in the system, changing the frequency, which has to be kept within very tight limits in the UK.

magyar

zeupater wrote: »

Hi

The above question as posed is based on a false premise ..... If supply & demand was to be irrelevant then there would be absolutely no reason to have a different tariff at night to encourage 'off peak' usage. Overnight, supply is high, demand is low thus creating conditions which favour the buyer, hence a low price/unit. This is typical supply & demand scenario .....

Z

Supply and demand is relevant for the entire system, what I mean is you can't consider a situation whereby because I'm prepared to pay more than, say, my next-door neighbour for electricity, that pushes the price up.

zeupater

grahamc2003 wrote: »

......... Not sure of this bit. Any installed wind capacity is simply added on to the existing capacity on the grid. (The 'capacity' for these discussions can simply be viewed as the theroetical maximum power of the plant, although in practice there are several measures of capaity).

I think you may be talking about generation, whereby say if there's a 1tw demand (matched of course by 1tw of supply), then if the wind stops blowing on a windfarm, and 100mw are lost, then simply 100mw of schedulable capacity replaces it (in fact, it will come from primary reserve initially, then later from grid engineers instructing another station to add another 100mw under certain complicated cirsumstances, or may just becaome part of the noise). If the wind then starts blowing again, and an extra 100mw of wind comes online, then the reverse will happen. (remember it's much more complicated in reality because demand is varying all the time on top of this uncontrollable element of the supply). Any mismatch between supply and demand will manifest itself with the difference changing the angular kinetic energy in the system, changing the frequency, which has to be kept within very tight limits in the UK.

Hi

From a purely logical point of view it must be correct .... consider the following scenario based on the previous logic & figures ....

Let's say that there is a national policy to maintain a generating capacity rated at 25% over standard peak demand so that it was possible to schedule plant maintenance and have a small degree of safety margin in order to guarantee that the lights will stay on. Let's also consider that unschedulable renewable power sources haven't been built yet, so .....
Demand(80)+25%(20)=TotalCapacity(100)

Okay, let's really become 'green' and have a policy to build some renewable sources with a potential to satisfy 50% of demand(40) +25%(10)Margin .... Do we now have a situation where the TotalCapacity is now 150, or is the TotalCapacity still 100, and what happens when the renewable capacity is doubled, is it now 200 or still 100 ? ..... whichever, remember, the policy is to ensure that you can guarantee to satisfy a demand of 80, so in the case of the higher renewable capacity (100) do we have ...

Demand(80)+25%(20)=TotalCapacity(100), which balances
....or...
Demand(80)+25%(20)=TotalCapacity(200), which doesn't

... if the answer is 200, then why have we gone against policy .... in come the accountants .... "surely with all of this overcapacity we can decommission the legacy generating capacity ?" .... All goes dark !!

... if the answer is 100, policy is adhered to, the lights stay on and the accountants understand the double entry bookkeeping .....

The following statement provides a clue to how the above is actually achieved - ".... wind is seen by National Grid as negative demand and as a consequence is netted of the demand within the distribution networks"
(http://www.nationalgrid.com/uk/sys_09/default.asp?action=mnchE_6.htm&Node=SYS&Snode=E_6&Exp=Y#Embedded_And_Renewable_Generation)

HTH
Z

grahamc2003

zeupater wrote: »

Hi

From a purely logical point of view it must be correct .... consider the following scenario based on the previous logic & figures ....

Let's say that there is a national policy to maintain a generating capacity rated at 25% over standard peak demand so that it was possible to schedule plant maintenance and have a small degree of safety margin in order to guarantee that the lights will stay on. Let's also consider that unschedulable renewable power sources haven't been built yet, so .....
Demand(80)+25%(20)=TotalCapacity(100)

Okay, let's really become 'green' and have a policy to build some renewable sources with a potential to satisfy 50% of demand(40) +25%(10)Margin .... Do we now have a situation where the TotalCapacity is now 150, or is the TotalCapacity still 100, and what happens when the renewable capacity is doubled, is it now 200 or still 100 ? ..... whichever, remember, the policy is to ensure that you can guarantee to satisfy a demand of 80, so in the case of the higher renewable capacity (100) do we have ...

Demand(80)+25%(20)=TotalCapacity(100), which balances
....or...
Demand(80)+25%(20)=TotalCapacity(200), which doesn't

... if the answer is 200, then why have we gone against policy .... in come the accountants .... "surely with all of this overcapacity we can decommission the legacy generating capacity ?" .... All goes dark !!

... if the answer is 100, policy is adhered to, the lights stay on and the accountants understand the double entry bookkeeping .....

The following statement provides a clue to how the above is actually achieved - ".... wind is seen by National Grid as negative demand and as a consequence is netted of the demand within the distribution networks"
(http://www.nationalgrid.com/uk/sys_09/default.asp?action=mnchE_6.htm&Node=SYS&Snode=E_6&Exp=Y#Embedded_And_Renewable_Generation)

HTH
Z

Hi Z, i think you are illustrating the vast difference between the properties of 'capacity' when applied to wind, and 'capacity' when applied to schedulable (or conventional) generation. It's like apples and oranges, although lumped togather as if it's the same thing.

So, an example.

Say we have 40GW of maximum period demand. Say we want 25% contingency, and so have 50GW of conventional, schedulable capacity (which I'll now refer to as SC).

Say a perfectly good 1GW coal fired station is mothballed. So we'd now have a system with 49GW capapcity.

Say someone thinks we should build 1000 1MW windmills to restore the original capacity. We'd then have 50GW capacity again. But we have added apples (49GW of SC) to oranges (1 GW of non-SC). We still have 25% capacity margin, but we certainly don't have the same system security, since we don't have the same level of reliable spare capacity.

With the current very low levels of wind penetration, this is all just noise - the magnitute of the wind generation is less than the accuracy the system works too. It's only the current very low level of windpower connected to the grid that the confusion between SC and non-SC appears to work. However, as you point out, once wind bcomes significant, say 10GW capacity, (currently it's around 5GW capacity, resulting in an average of about 1.3GW generation due to the caspacity factor of wind) then this lack of precision of the term 'capacity' will have to be addressed. As you say, it's likely that politicians/accountans will - incorrectly - see the 25% capacity margin as just fine, even with high wind penetration.

The other point ".... wind is seen by National Grid as negative demand and as a consequence is netted of the demand within the distribution networks" - well that really isn't saying anything about capacity. It's saying how intermittant generation (wind) is currently handled. Because it's varying, it looks more like negative demand than generation. Remember grid engineers can control the generation (using SC) to meet the uncontrollable demand, and non-SC naturally fits in all the grid systems as demand (albeit negative) due to the uncontrollability and variability of it).

As an example - demand is estimated as an average per half hour of the day, the day before, and the balance of plant required to meet that demand is scheduled. So today, grid engineers will be estimating demand for each half hour period tomorrow, using very sophisticated techniques which take into account many diverse factors. So they may come out with an average demand for 12:30 to 01:00 of 15.6GW. (I.E. 7.8GWh of energy during that period). Before wind, that would be that, but what the extract says is that any wind power (which is really the generation helping to meet that demand) is now accounted for on the demand side. So someone will look at weather forecasts and try to guess how much windpower will be produced during the half hour 12:30-01:00 tomorrow. Say it's an average of 300MW (i.e. 150MWH of energy). That will then be treated as 300MW of negative demand, and it will be subtracted from the real forecast demand of 15.6GW, giving a new demand for that period of 15.3GW, and that net figure will go forward and the grid engineers will ensure there's 15.3GW of generation during that period. Still awake?

It's obvious why any variable generation is treated in this way. All the software and systems within the grid basically assume an uncontrollable demand and controllable generation. When a new thing like uncontrollable generation comes along (like wind), then the easiest and neatest way of handling it with the minimum of system changes is to treat it as negative demand.

Again, while wind penetration is small, all these systems are very forgiving, but when wind becomes a larger part (as is seemingly planned), then squeezing it into existing grid systems may simply not work.

This is not so off-topic for this thread as may first appear. Behind the scenes, to accomodate larger penetration of unschedulable, variable, intermittent generation requires a great deal of expensive effort, and the systems developed to enable it will very likely be extremely expensive to run on an ongoing basis.

dunloadin

Interesting info here; http://www.theoildrum.com/node/8146#more

The coming UK energy meltdown

Serially wrong
The UK’s ostrich-like reluctance to see the world as it is, rather than how it wishes the world to be, is shared by many of today’s energy-importing members of the OECD, gathered under the auspices of the International Energy Agency. The IEA was set up by the OECD in the wake of the 1973 oil supply crisis. Its primary duty has been to advise its client governments about oil supply and to coordinate oil stocks in the event of supply disruptions. However, the IEA’s own record of energy demand, supply and price forecasting has been dismal, especially in recent years.

It has been consistently optimistic - and serially wrong - both as regards the availability and price of crude oil (as well as gas and coal).

Perhaps we should stop blaming Centrica/BG....there are another 5 in the big 6 after all.....and the UK Government has played its part as well....

Complicated subsidy

The idea behind the liberalisation of the UK energy market started under Margaret Thatcher was to have a free market in generation and sales and a government-regulated transmission and distribution system. Then Energy Minister, later Chancellor (Economics Minister) Nigel Lawson famously said at the time that “energy (should be) a traded good like any other commodity and its supply was to be settled in the market place”.

This has more or less come to pass. We have a regulated (privately owned) transmission company, National Grid, that owns the country’s high voltage transmission system (as well as the high-pressure gas transmission system). Almost all the major thermal power stations, fossil-fueled and nuclear, are now owned by six large energy corporations, EdF, Centrica, Eon, RWE, Iberdrola and Scottish & Southern Energy (SSE). Consumers are free to switch energy supplier and energy switching rates in Britain are among the highest in the world. Energy prices are not (yet) particularly high compared to the rest of the EU.

Yet all this is irrelevant if in the long term not enough investment is made in power generation while the UK at the same time is becoming dependent on outside suppliers. This will lead to an energy crisis no matter how “the market” is organised. And this is the reality we are headed for. Why is this so?

It should be noted that, rather than leaving the energy market “free”, the UK government has embarked on a hugely ambitious climate change program that has far-reaching impacts on the power generation market. In 2008 the UK Parliament voted through the Climate Change Bill and thus made CO2 emission reduction a legal requirement for the Nation, and not just for its own remaining tenure but all the way through to 2050. During the same year the UK Government agreed to implement the EU’s 20-20-20 targets, which require that the country will deliver 20% of its energy demand from renewable energy and reduce CO2 emissions by 20% by 2020, just eight years from now.

In addition, the Labour Government introduced an expensive subsidy, called the Renewable Energy Obligation. This obliges electricity companies to purchase an ever increasing fraction of their power from OFGEM-approved renewable energy resources. A Renewable Obligation Certificate (or ROC) rewards the wind turbine or biofuel generator with an agreed number of ROCs (between 0.5 and 2) per MWh, over a pre-agreed number of years, depending on which renewable resource the Government wishes to incentivize. The cost is met by the consumer to whose electricity account all of this is charged. The typical value of an ROC to any renewable energy generator since it was launched has been between £30 and £50; it is the subsidy the generator receives on top of the market price. So far, this subsidy has cost consumers £5 billion, with £1 billion in 2010 alone.

This is set to rise to £7 billion per year by 2020, representing an accumulated transfer from consumers to (mostly) wind developers of roughly £40 billion – enough money to pay for a respectably sized nuclear capacity.

So far this incentive is delivering only 6.5% of the UK’s electricity whereas the target for 2010 was 10%. The transparent failure of this incentivization programme to achieve its targets should have given the in-coming Government some warning. Instead, it ploughs on regardless, introducing continental–style feed-in tariff (FITs) for roof top PV (annual capacity factor about 6%) costing consumers anything up to 40p/kWh. This is a great way to further transfer funds from poor consumers to rich house owners. None of these renewable energy sources will deliver any firm capacity.
Public consultations
In 2009, OFGEM belatedly realized that the “energy-only” electricity trading system that it set up in 2002, was no longer fit for purpose. This trading arrangement, called NETA, replaced the “energy + capacity” trading system put into place at privatization. Under NETA, generators have no incentive to invest in spare capacity. Now OFGEM and the Government have become aware that a completely new tariff structure will be needed to fund a properly diversified mix of privately owned, dispatchable generating capacity needed to meet the ambitious targets of the Climate Change Bill and the 20-20-20 targets, while also delivering energy security. Far too late, they are realizing that dispatchable “low carbon” capacity does not come cheap. In fact, according to a recent news report, generators are now discussing with the government massive subsidies (to the tune of £10 billion) to build back-up gas-fired power plants that will stand idle for most of the time.

In all, it is estimated that between £100 and £200 billion of investments in offshore wind, transmission lines and back-up capacity are needed to realize the green dreams of the UK government. At this moment, the new Coalition government is studying a proposed Electricity Market Reform (ERM) that will determine the new tariff structure. This is merely the latest round in an endless series of “public consultations” and energy and global-warming related “white papers” that have been produced by the government in the last 14 years since liberalisation. (This included an announcement in 2003 that no new nuclear build was needed to achieve the UK’s climate targets followed by one in 2006 that said that nuclear energy is vital.)

The effect of all these U-turns and consultations has been to make the market extremely wary of committing money into the generation sector. The “money men” have not forgotten the introduction of the NETA energy trading system when many billions were lost by private generators who had invested in the UK generating sector under the old rules. The nuclear industry was bankrupted and had to be nationalized. Europe’s largest generator, Drax Power, was only saved by its bankers taking a longer view but at a huge cost to its then owner, AES.

The new trading rules that the Coalition is preparing come at a sensitive time, when the media are full of horror stories about price rises while millions per month are being spent by National Grid for compensating wind turbine owners whose output is being curtailed because of network congestion. OFGEM has said the investment required to ensure UK energy security and to decarbonise the power industry to 2020 could see consumer bills increase by anything between 23 and 52 per cent - equivalent to adding between £250 and £600 to today's average annual bill. There is a real risk that consumers “can’t pay and won’t pay”. Under these circumstances, the chances of separating £200 billion of private capital from its owners to be invested in the UK’s long-term “low carbon” vision must be slim indeed.

Tipping point
The challenges described in this paper cannot be fixed as long as they remain unrecognized by the people that we elect to write and abolish legislation. Elaborate roadmaps to 2050 and lofty-sounding calls for emission targets in the mid-2020s will be as pointless and useless to future generations as any such “road map” for the nation would have been if written in (say) 1910 or 1934.

Among the chief dangers that the UK faces in 2011 is the critical obsolescence of its electricity infrastructure, its essential bankruptcy and the absolutely unrealistic aspirations of almost its entire political class, although not its population, for a new, low-carbon, high-growth, job-creating, tax-paying economy.

The imminent closure of 16 GW of coal, oil and nuclear power plants and the realization that these simply cannot be replaced by the equivalent - or even much greater - wind power capacity, (even if it could be built, which is doubtful) is widely recognized in most senior echelons of the UK’s financial, manufacturing and engineering companies. Speaking at the recent Economist Energy Summit in London, Sam Laidlaw, CEO of Centrica, said: "We are rapidly approaching a tipping point in the energy story of this country and there is a risk that society is not being realistic about the path ahead. (…) Over this next decade three forces are coming together - our growing dependence on increasingly volatile world energy markets; our commitment to make serious cuts in carbon emissions; and our obligation as a society to ensure that energy remains affordable at a time of huge pressure on household incomes."

The problem is not unique to the UK. Major energy and concomitant trade deficits and even national bankruptcy are facing countries all over Europe. Europe cannot afford much more of the same.

It is probably pointless to try and get this message through to the EU’s present energy establishment, fixated as it is on perpetuating Kyoto and writing endless “2050 road-maps”. But given the extreme fragility of the UK’s economy, and the imminence of an electricity supply failure, it may still be possible to bring to the attention of the UK’s financially embattled Coalition, the extreme danger of its chosen policies, before the financial plug is pulled and its emission-related targets are exceeded by industrial ruin.

There can be no doubt that the UK must evolve an energy strategy that will liberate the economy from hydrocarbons as fast as possible. But its resources and financial circumstances are increasingly modest. The energy aspirations of its politicians are incoherent and technically illiterate. All this is about to come to a head with the transparent reluctance of international financiers to invest in the “green” economy. A huge U-turn lies ahead when it will have to plead with its EU partners for a derogation on the closure of the coal capacity and with EdF to keep the old nuclear fleet on the road, while developing a more realistic energy plan. This must almost certainly require the electrification of almost everything and the speeding up of nuclear capacity build, wherever possible innovating technically and reducing the costs by depending more on South Korea and China than our partners across the Channel in France.

The whole blog is worth a read.

zeupater

grahamc2003 wrote: »

..... However, as you point out, once wind bcomes significant, say 10GW capacity, (currently it's around 5GW capacity, resulting in an average of about 1.3GW generation due to the caspacity factor of wind) then this lack of precision of the term 'capacity' will have to be addressed. As you say, it's likely that politicians/accountans will - incorrectly - see the 25% capacity margin as just fine, even with high wind penetration.

The other point ".... wind is seen by National Grid as negative demand and as a consequence is netted of the demand within the distribution networks" - well that really isn't saying anything about capacity. It's saying how intermittant generation (wind) is currently handled. Because it's varying, it looks more like negative demand than generation. ....

Hi

Agree ..... The issue is that if demand is adjusted to reflect an adjustment for non-schedulable generation then capacity must also be treated the same way, else the capacity/demand equation doesn't balance, which, as you mention, doesn't really matter at the current level of renewable generation .... it's probably currently no more significant than a simple rounding error. Logic should stand when tested to extremes, so applying the 50% and 100% unschedulable increases to the TotalCapacity demonstrates that either capacity is calculated that way, or the logic behind the calculation is wrong.

Perhaps I've got it all wrong and the sun will shine and the wind will blow all day, every day, but then the demand calculation would be wrong and .........

Oh well, back to the subject at hand .... for a given annual mileage, if I suddenly decided to replace my current car with two, one which would work every day and one which only worked one day in three I'd be paying a lot more in depreciation, therefore wouldn't I expect my overall cost per mile to increase ?

HTH
Z