Green, ethical, energy issues in the news

michaels

Martyn1981 said:

michaels said:

Martyn1981 said:

Exiled_Tyke said:

Martyn1981 said:

I think it comes down to ideology, and even fear of change, and of course fear of change is perfectly natural, so it shouldn't be ignored.
My way around the nuclear v's RE + (RE + storage) economics is simple, I've learnt from Zeupater that if in doubt apply the 'Z test', or to put it simply, test it to the extreme!
So it might be hard to believe that RE + (RE + storage) can economically compete with nuclear, but (to steal a phrase) 'at what cost?'

If nuclear cost £1m/MWh, then clearly RE wins. How about £10k/MWh, or £1k/MWh, or £200/MWh? Once we apply the Z test it becomes clear that nuclear isn't essential, if the same job can be done more economically. Now, some might not believe that £100/MWh can be beaten by RE + (RE + storage), but once the principle is established, and can't be denied, then it simply becomes an issue of settling on the price at which the switch is viable.

In the case of Tony Seba, the NIC and Lazards, just to name the ones I've posted links to in the past, the price point has been reached, and whilst RE may not match the 'package' that nuclear brings to the table at £104/MWh (in the case of the UK's new build) it would seem that the price differential of around £60/MWh between new RE and new nuclear is enough to add storage to make the leccy sources comparable, and at that point it's game over for nuclear as it brings nothing to the table anymore* that can't be done quicker and cheaper, and oh so much easier.

Not sure it's clear here but I think by RE + (RE+storage) you are implying that not all the RE needs to be stored?  Which I think is a very important point.  A significant amount of RE will be used as its produced. So for that proportion of the leccy produced then its a straightforward RE cost versus nuclear.  And RE won that one some time ago.  So the proportion of leccy which needs to be stored, RE+Storage cost  can now be greater than nuclear to a degree and nuclear overall will still lose.  

But even if RE + (RE + Storage) = nuclear surely any rational person (so not a current government minister) would choose the RE option because of the externalities?

You are absolutely spot on, and I should have made that clear. As you say it's important because it changes the amount of money available for storage per stored unit. If we store all the leccy (and ignore losses for a moment) then we have about £59/MWh to cover storage costs, (nuclear - RE generation cost), but if we only store half the RE leccy, as the rest is consumed directly when generated, then the spare cash is now equivalent to £118/MWh.
Looking at the figures folk are using for domestic battery storage, as the costs fall and the cycles rise, perhaps 5p/kWh is doable, so around £50/MWh even on a micro scale.

For large scale / longer term storage I'm assuming the cost will be much lower as the storage part of the cost is much cheaper than batts as it doesn't duplicate the conversion technology (such as leccy to H2, or leccy to liquid air), only the storage technology, which is effectively 'just' more storage tanks. But when you expand batts, you expand almost all the costs, as it's the storage (the batteries) that is the expensive part. Hopefully these lower CAPEX costs make up for the lower efficiencies.

So in a World where we store 50% of the RE generation, let's say 25% for intraday use, and 25% for long term use, then that £118/MWh difference between nuclear and RE is a massive amount, and hence why even after allowing for additional RE generation to cover lossess, and all the storage costs, RE + (RE + storage) comes out cheaper than nuclear.

Also worth pointing out (again) that nuclear also needs storage, since in the RE case the storage allows us to demand follow, to consume less at low periods, and to supply more at high demand periods, whereas the nuclear without storage option, means you have too much or too little at times, and then have to hide the storage need by 'only' having a small amount of nuclear, and calling it baseload.


For anyone who hasn't completely given up on me by now, I recently vomited up some numbers in a discussion on HPC and SC (Sizewell C) to show the sheer scale of the issue here:

I'm also holding on to the thin hope that the SC CfD will have to be so high to get France and China to agree that it'll then be too high for 'us' to accept, especially now that off-shore wind contracts are so flippin cheap. Back when HPC got the £92.50 deal, I think off-shore wind was around £160, whereas now, with inflation HPC is £104 with the latest off-shore wind at £45 and due to commission before HPC.
If we take the £59/MWh difference, quickly multiply it by 3,200MW x 92%cf x 24hr x 365days x 35yrs, that gives us £53bn to spend on additional RE generation and storage capacity.
Keep running with this and your mind starts to fight back and say that can't be right, we could have generation equal to HPC, plus £53bn to spend on say another 40GW of RE capacity and £13bn left over to buy storage kit and capacity.

Someone very wise (it was either Mart or Z) once told me that it is not just the cost of the storage but the number of cycles that matters - that battery might cost 5p per kwh if you put 5,000 cycles through it in 15 years but if you were instead using it for those windless winter spells like the one we are experiencing now then it might be 5 cycles per year rather than 300 and the cost per cycle there for 60x higher.

Nice try, but I think you are trying to confuse intra-day storage, mostly likely batts, and several cycles per day, with large scale longer term storage, which will cycle far less often. Hence the paragraph following the 5p/kWh example, where I suggested the CAPEX would be lower and help to make up for the lower efficiencies.

I didn't miss that bit it was just the only certain cost that was supplied was the 5p.  Do you have any estimates what the long term storage capacity needed might be and how much per unit this might cost given the likely number of cycles?  Note I am not saying it can't be done and make sense (so no need to get defensive, I am in the green camp but just want to know the hows), more than I didn't think your post actually contained the answers and the 5p for battery storage for daily cycling was a bit of a red herring (although might be used to make a very powerful argument for nuclear plus battery being much cheaper than battery on its own).

Imports help but I think France (led by economics) is also going RE rather than replacing their nukes wholesale so medium long term they won't be a reliable source for imports either and the whole of Europe can't rely on Norwegian hydro.

Martyn1981

The 5p example was based on micro scale domestic batts for intraday storage, since this would appear to be a known, and from there we can safely assume that larger scale battery storage will be cheaper.

For large scale, longer term storage, the cost of cycling will be lower, but of course less cycles and at a lower efficiency. If you think the cost will be 60x times higher then I'd welcome the info to peruse, but as I said, you are using a price from one type of storage, then conflating that with the differing cycling of another type.

You also need to consider the buy and sell price of the leccy, with intraday storage buying excess which will be cheap, and supplying it back when prices rise. But longer term storage will be mopping up the leftovers after intraday storage is full, and supplying demand when intraday is empty, so it will be buying very low, and selling very high - purely examples, but perhaps £0-£10/MWh buy and sell at £100/MWh. This arbitrage will subsidise the costs and losses within the system.

Personally, I'm more than happy to take the lazy approach until more is known and simply rely on the fact that both battery storage and LAES is starting to roll out commercially, which allows me to assume that it is economic on the fringes today. I also, as you will note, refer to articles and studies I have read, since I'm not in any way, shape, or form an expert, from there I have simply pointed out that multiple sources are now stating that RE + (RE + storage) is (or will be) a cheaper option than nuclear.

Apologies if you thought I was getting defensive, I genuinely thought that was a good try by you to get one passed. I thought this was 'our thing' where I post good news and you use the 'Just asking questions' tactic to imply or shoe horn in negatives. I've mentioned this before, and thought it was common knowledge, in fact it goes back many, many years to the Energy boards and 'cells' posts, and then when he created the 'Great Ape' account and moved to the G&E board.

In all honesty it's probably helped 'lift my game' as I need to consider 'What will michaels try this time?' when I'm drafting a comment.

May the game continue. 

michaels

Mart, you still have me completely wrong, I am just trying to pick my way between JoeFizz and his Harvard course saying one thing and other people saying something else. 

I am sure you are right on this argument but I would love it if you could produce numbers to back up long term storage plus RE costs, we are both agreed that the cost of domestic battery storage does not have anything to tell us about this seemingly much more important storage cost (devils advocate again, cheap battery storage will actually reduce the amount of cheap spill from RE generation via intraday arbitrage).

Exiled_Tyke

Good points raised on storage. Thanks for the 'debate'.   Are we considering all forms of storage here?  Did I hear a rumour that another Dinorwig type project was planned in Scotland? Personally I like the sound of dropping heavy weights down mine shafts although I'm guessing round trip losses for that would be quite sizeable.

Exiled_Tyke

Solarchaser said:

Exiled_Tyke said:

While HPC always seemed like a ludicrous idea to me I can only assume that government (well in this case KPMG) did an NPV calculation which showed that foreign investment during construction would outweigh the subsidies. But did they account for the startling reduction in wind prices? I guess they did some conservative estimates there but I'l love to read the KPMG reports. 

Based on the current shambles with ppe, id strongly suspect one or more of our ministers are getting backhanders from nuclear, call me cynical, you would be right!

I too think the cynicism may well be appropriate. But to give the benefit of the doubt, could the reason for going ahead because of the inward foreign spend now creating jobs against the future discounted cashflows? Or (very cynical) government willingly taking the investment in the expectation that the project will never come to fruition?  

Martyn1981

michaels said:

Mart, you still have me completely wrong, I am just trying to pick my way between JoeFizz and his Harvard course saying one thing and other people saying something else. 

I am sure you are right on this argument but I would love it if you could produce numbers to back up long term storage plus RE costs, we are both agreed that the cost of domestic battery storage does not have anything to tell us about this seemingly much more important storage cost (devils advocate again, cheap battery storage will actually reduce the amount of cheap spill from RE generation via intraday arbitrage).

Yep, battery storage will consume excess and provide the much needed intraday balancing to allow RE to reach greater penetration.

Only after this 'expensive' but frequently cycled storage has been filled, will we then see spill / waste / curtailment again, and once it becomes economic to 'harvest' it, we will see 'cheaper' but less frequently cycled longer term and larger scale storage arrive to make use of it.

If you think about it, in your earlier post you mentioned that less cycles, means a higher cost of using batteries, so you must realise that there is an economic point where battery capacity will stop, as the returns will make further deployment unviable. So whilst cheaper batts will most certainly (in my opinion) mean a larger amount of battery storage, there will always be a point where alternatives make more sense.

Perhaps a good example would be flow batts, which sorta straddle the two roles - to increase the energy you can increase the size of the tanks, quite cheaply, without having to increase the power and the associated cost. They are less efficient, but have no real limit on cycles.

With H2, LAES, CAES and so on, they won't be needed until the intraday role has been 'economically' fulfilled, which means that the excess now available is the bottom of the barrel, and nobody has any use for it ....... other than longer term storage. In fact, storage should role out naturally as clever people spot a market opportunity, and deploy the appropriate technology. This appears to be starting for longer term storage as we see news items on LAES and H2.

Regarding long term storage and costs, I can only repeat that I've posted many news articles reporting on 'experts' who are saying that RE + (RE + storage) is more economical than nuclear. It's not for me to report the numbers, I doubt I would even understand the full calculations, it's for those that claim nuclear is the better option to provide evidence, instead of opinions, to the contrary. Joe can disagree with me as much as he likes, you can ask me questions (loaded or not) as much as you like, but at the end of the day, I don't matter in the slightest here, only the news and the facts it contains, does.

Martyn1981

Exiled_Tyke said:

Good points raised on storage. Thanks for the 'debate'.   Are we considering all forms of storage here?  Did I hear a rumour that another Dinorwig type project was planned in Scotland? Personally I like the sound of dropping heavy weights down mine shafts although I'm guessing round trip losses for that would be quite sizeable.

I suspect it's actually quite efficient, as there won't be many losses, possibly better than pumped hydro storage at 70%(?) since the water has friction in the pipes on both routes. Guessing now, but both probably sit nearer the intraday range, with GWh's of storage, whereas H2 for example could reach TWh's by simply (simply is tongue in cheek) building more storage tanks.
The funny thing here, or at least I find it funny, is that the nuclear age might lose out to the stone age, if dropping lumps of granite or concrete down a hole is the economic deciding factor ..... is that funny?

Martyn1981

Here's a link to Gravitricity. And I may have called it wrong - at a lower cost than lithium batts, and 80-90% efficiency, then that would suggest it has a firm intraday role, I think, depending I suppose on the cost curve of batts, as presumably once this technology has been developed, it probably won't get any cheaper(?)

Gravitricity - Fast, long-life energy storage

michaels

I think we can do some back of the envelope ideas of what the storage would need to cost to make sense with reasonable assumptions on future energy demand by source and how much storage might be need and how many cycles it might provide. 

Being pragmatic I would also not be against short term solutions which might feature 'dirty and expensive' fuels being burned in capital cheap generators to cover short short periods of low renewable supply if this allowed renewables to be built out more quickly it might well provide greener energy overall.

It may also be something where the market solution is socially sub optional - the market might say it makes most sense to let prices go sky high to the point where there is a big demand response but politically granny sitting in the cold and dark is probably unacceptable so the govt might have to provide incentives (minimum income guarantees?) to storage providers in a similar way to the current CFDs for renewables which guard suppliers from the situation where wind energy is so plentiful it 'eats its on lunch' and forces prices down to zero every time the wind blows.

Martyn1981

I'd genuinely be interested in any numbers you can come up with. I'm not even sure where to start, since the OPEX and income parts are moving targets - will the leccy cost a little, or nothing, or even be negatively priced? What will it sell for, which in turn depends on what alternatives will switch on, and at what price?
I suppose we might be able to work out the CAPEX of a LAES plant from Highview, and guess our way from there. In terms of need, it'll Shirley be multiple days of sizeable support. Currently we use about 1TWh per day, so even at 50% support that's 1TWh/day (assuming demand doubles), then that means multiples of TWh's, which would seem to move us into levels of storage that perhaps only gas storage can provide. That might mean more of those enormous gas tanks, or salt cavern use, or a return to that North Sea thingie we used to use for nat gas? 

Regarding short term solutions, again aren't you describing exactly what is happening today, with FF gas acting as the demand follower, being burnt in existing capital cheap generators, in fact they may by now have fully amortized their CAPEX. This approach is allowing us to roll out RE faster, but as Tony Seba suggests, RE + storage (or SWB (solar wind and batteries)) will eventually undercut that too, perhaps 2030 onwards. But not necessarily bad news for the gas plants, since if we produce enormous volumes of H2 slowly, as one of our long term storage solutions, then existing gas plants would allow us to generate leccy quickly, when needed.

As to 'sky high prices', and 'granny sitting in the cold' and wind energy eating its own lunch with prices going to zero every time the wind blows ....... interesting, very interesting.