The Alternative Green Energy Thread

JKenH

michaels said:

JKenH said:

While gas prices will likely ease into next year, the dynamics of the power markets will remain challenging for the next few years

Most projections indicate energy prices will rise over the next decade, possibly adding another 50% to current levels. But these price rises will not be uniform: more renewables with near-zero marginal cost means more periods of low or negative pricing.

More price cannibalisation due to low wholesale prices could make un-subsidised renewable energy projects un-viable by the 2030s. At the same time, studies have also shown that despite claims to the contrary, the capex and opex costs of off-shore wind are not falling. This calls into question the future of existing plant as subsidies expire, as well as the chances of financing new projects.

https://watt-logic.com/2021/11/21/energy-esg/

If the subsidised price is half or less than the price of nuclear, do we really care about the subsidy?!

I had posted that as a news article rather than with any intention of starting a ncclear/RE debate. We should care about the subsidy particularly the subsidies awarded to wind farms under the ROCs scheme.

The two floating offshore wind farms, Hywind and Kincardine, which receive 3.5 ROCs per MWh cost the consumer £193 per MWh generated. The ROCS subsidies run for 20 years. The subsidies for CFD supported wind farms operating in 2020 ranged from £99 to £139/MWh. The total subsidy for offshore wind farms in 2020 was £4.3bn. That’s around £70 per capita. 

JKenH

Offshore wind leaders warn CfD changes may be needed as UK sector grows

Sven Utermöhlen, CEO of offshore wind at developer RWE Renewables, said: “We need to think about auction design for offshore wind farms, but also the much wider question of the electricity and energy market design. We need to think about in ten or 20 years’ time, when we have 75% renewable energy, how would electricity prices be established in the first place, and how do we do that to incentivise new investment? 

“At some point, the short-term margin costs are zero. If that is the case, nobody will invest in new plants. We need a price that reflects the low cost of renewables, but also incentivises investment in new plants.”

https://www.windpowermonthly.com/article/1728953/offshore-wind-leaders-warn-cfd-changes-may-needed-uk-sector-grows

ABrass

JKenH said:

michaels said:

JKenH said:

While gas prices will likely ease into next year, the dynamics of the power markets will remain challenging for the next few years

Most projections indicate energy prices will rise over the next decade, possibly adding another 50% to current levels. But these price rises will not be uniform: more renewables with near-zero marginal cost means more periods of low or negative pricing.

More price cannibalisation due to low wholesale prices could make un-subsidised renewable energy projects un-viable by the 2030s. At the same time, studies have also shown that despite claims to the contrary, the capex and opex costs of off-shore wind are not falling. This calls into question the future of existing plant as subsidies expire, as well as the chances of financing new projects.

https://watt-logic.com/2021/11/21/energy-esg/

If the subsidised price is half or less than the price of nuclear, do we really care about the subsidy?!

I had posted that as a news article rather than with any intention of starting a ncclear/RE debate. We should care about the subsidy particularly the subsidies awarded to wind farms under the ROCs scheme.

The two floating offshore wind farms, Hywind and Kincardine, which receive 3.5 ROCs per MWh cost the consumer £193 per MWh generated. The ROCS subsidies run for 20 years. The subsidies for CFD supported wind farms operating in 2020 ranged from £99 to £139/MWh. The total subsidy for offshore wind farms in 2020 was £4.3bn. That’s around £70 per capita. 

Kincardine: 50MW wind farm

Hywind: 30MW wind farm
Both new floating ones to prove the designs.

The CFD rates for farms operating in 2020 were generally negotiated in 2016 or earlier.

If you copy your information from the GWPF you're going to o get misleading stats.

QrizB

JKenH said:

michaels said:

If the subsidised price is half or less than the price of nuclear, do we really care about the subsidy?!

I had posted that as a news article rather than with any intention of starting a ncclear/RE debate. We should care about the subsidy particularly the subsidies awarded to wind farms under the ROCs scheme.
The two floating offshore wind farms, Hywind and Kincardine, which receive 3.5 ROCs per MWh cost the consumer £193 per MWh generated. The ROCS subsidies run for 20 years. The subsidies for CFD supported wind farms operating in 2020 ranged from £99 to £139/MWh. The total subsidy for offshore wind farms in 2020 was £4.3bn. That’s around £70 per capita. 

According to data at https://www.lowcarboncontracts.uk/dashboards/cfd/actuals-dashboards/historical-dashboard

• The current Interim Levy Demand (the charge made to generators to cover CfDs) is zero;
• The subsidies paid to both onshore (-£13.7M) and offshore (-£8.5M) wind for 2021Q4 are negative, ie. the wind farms are paying into the fund.

Obviously this is due to the current high wholesale electricity price, but it's worth bearing in mind that CfDs and ROCs are a partial cap on wholesale electricity prices; we (as energy consumers) will get back a certain proportion of any money spent on buying power in excess of the CfD / ROC price.

JKenH

ABrass said:

JKenH said:

michaels said:

JKenH said:

While gas prices will likely ease into next year, the dynamics of the power markets will remain challenging for the next few years

Most projections indicate energy prices will rise over the next decade, possibly adding another 50% to current levels. But these price rises will not be uniform: more renewables with near-zero marginal cost means more periods of low or negative pricing.

More price cannibalisation due to low wholesale prices could make un-subsidised renewable energy projects un-viable by the 2030s. At the same time, studies have also shown that despite claims to the contrary, the capex and opex costs of off-shore wind are not falling. This calls into question the future of existing plant as subsidies expire, as well as the chances of financing new projects.

https://watt-logic.com/2021/11/21/energy-esg/

If the subsidised price is half or less than the price of nuclear, do we really care about the subsidy?!

I had posted that as a news article rather than with any intention of starting a ncclear/RE debate. We should care about the subsidy particularly the subsidies awarded to wind farms under the ROCs scheme.

The two floating offshore wind farms, Hywind and Kincardine, which receive 3.5 ROCs per MWh cost the consumer £193 per MWh generated. The ROCS subsidies run for 20 years. The subsidies for CFD supported wind farms operating in 2020 ranged from £99 to £139/MWh. The total subsidy for offshore wind farms in 2020 was £4.3bn. That’s around £70 per capita. 

The CFD rates for farms operating in 2020 were generally negotiated in 2016 or earlier.

And when was the Hinckley Point CfD negotiated?

JKenH

QrizB said:

JKenH said:

michaels said:

If the subsidised price is half or less than the price of nuclear, do we really care about the subsidy?!

I had posted that as a news article rather than with any intention of starting a ncclear/RE debate. We should care about the subsidy particularly the subsidies awarded to wind farms under the ROCs scheme.
The two floating offshore wind farms, Hywind and Kincardine, which receive 3.5 ROCs per MWh cost the consumer £193 per MWh generated. The ROCS subsidies run for 20 years. The subsidies for CFD supported wind farms operating in 2020 ranged from £99 to £139/MWh. The total subsidy for offshore wind farms in 2020 was £4.3bn. That’s around £70 per capita. 

According to data at https://www.lowcarboncontracts.uk/dashboards/cfd/actuals-dashboards/historical-dashboard

• The current Interim Levy Demand (the charge made to generators to cover CfDs) is zero;
• The subsidies paid to both onshore (-£13.7M) and offshore (-£8.5M) wind for 2021Q4 are negative, ie. the wind farms are paying into the fund.

Obviously this is due to the current high wholesale electricity price, but it's worth bearing in mind that CfDs and ROCs are a partial cap on wholesale electricity prices; we (as energy consumers) will get back a certain proportion of any money spent on buying power in excess of the CfD / ROC price.

The Hinckley Point C will also effectively therefore be a cap on electricity prices so maybe we should thank the government of the day for their foresight in setting such a low CfD.

When discussing Hinckley Point C  CfD much is made of the very low strike prices for the later wind contracts which have yet to generate any power while conveniently forgetting the cost of the subsidies for wind that were being negotiated/set when the HPC contract was struck.

michaels

JKenH said:

QrizB said:

JKenH said:

michaels said:

If the subsidised price is half or less than the price of nuclear, do we really care about the subsidy?!

I had posted that as a news article rather than with any intention of starting a ncclear/RE debate. We should care about the subsidy particularly the subsidies awarded to wind farms under the ROCs scheme.
The two floating offshore wind farms, Hywind and Kincardine, which receive 3.5 ROCs per MWh cost the consumer £193 per MWh generated. The ROCS subsidies run for 20 years. The subsidies for CFD supported wind farms operating in 2020 ranged from £99 to £139/MWh. The total subsidy for offshore wind farms in 2020 was £4.3bn. That’s around £70 per capita. 

According to data at https://www.lowcarboncontracts.uk/dashboards/cfd/actuals-dashboards/historical-dashboard

• The current Interim Levy Demand (the charge made to generators to cover CfDs) is zero;
• The subsidies paid to both onshore (-£13.7M) and offshore (-£8.5M) wind for 2021Q4 are negative, ie. the wind farms are paying into the fund.

Obviously this is due to the current high wholesale electricity price, but it's worth bearing in mind that CfDs and ROCs are a partial cap on wholesale electricity prices; we (as energy consumers) will get back a certain proportion of any money spent on buying power in excess of the CfD / ROC price.

The Hinckley Point C will also effectively therefore be a cap on electricity prices so maybe we should thank the government of the day for their foresight in setting such a low CfD.

When discussing Hinckley Point C  CfD much is made of the very low strike prices for the later wind contracts which have yet to generate any power while conveniently forgetting the cost of the subsidies for wind that were being negotiated/set when the HPC contract was struck.

To which I guess the obvious response is - how much electricity has HPC produced so far?!  Presumably some of the capacity in this year's cfd auction that ha not even been held yet will be on stream before HPC generates a single watt, even if it is built to current timescales....

JKenH

There are many other RE technologies for which higher strike prices are anticipated than offshore wind or even nuclear. Should we abandon these?

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1016681/cfd-ar4-asp.pdf

QrizB

JKenH said:

There are many other RE technologies for which higher strike prices are anticipated than offshore wind or even nuclear. Should we abandon these?

It will be interesting to see whether any of those technologies get proposals beyond "pilot plant" size, and what strike prices are actually agreed for them.

There's a quantitative difference between agreeing £258/kWh for a 2MW technology demonstrator and £93/MW for a 3GW third-generation example of an established technology.

JKenH

So is the consensus that HPC CfD should have been at a lower figure when set in 2013?