Archive for the ‘Renewable Energy’ Category

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Europe is paying the price for its infatuation with renewable energy

July 30, 2013

Electricity and the price of its generation is now one of the most fundamental parameters which steers the economy and industry and ultimately the level of unemployment in any country. It ought not to be subject to the misguided whims and fancies of “feel-good” environmentalism, but for the last 2 decades much of Europe has been travelling down a cul-de-sac chasing a mirage. Instead of just focusing on generating electricity at the lowest possible cost while keeping the air and water sufficiently clean, politicians have been lured down the renewable energy path in a fantasy of saving the world from the imaginary dragon of carbon dioxide emissions. Instead of just using wind and solar energy in the special niches they are suited to, they have been subsidised and promoted as basic generation which is a role they cannot fulfill.

The US with its much lower electricity prices now has a significant competitive advantage over Europe and will come out of the  recession much faster as it creates jobs.

As David Garman and Samuel Thernstrom write in the Wall Street Journal:

Europe has bet big on wind and solar energy, and many environmental advocates would like America to follow. Wind and solar have a role in the U.S. energy economy, but we would be wise to see the cautionary tale in the European experience and adjust our plans accordingly.

Wind and solar generate 3.5% of America’s electricity today, but Denmark gets 30% of its electricity from wind and hopes to produce 50% by 2020. Germany, Europe’s largest national economy, produces roughly 12% of its electricity from wind and solar today, and it wants renewable energy to account for 35% of electricity generation by 2020.

Clean energy powered by renewable resources is understandably attractive. But the honeymoon with renewables is ending for some Europeans as the practical challenges of the relationship become clear.

The first challenge is cost. Germany has reportedly invested more than $250 billion in renewable energy deployment, and its households pay the highest power costs in Europe—except for the Danish. On average, Germans and Danes pay roughly 300% more for residential electricity than Americans do.

But it is not just price that is at issue. The reliability of electricity supply is not helped by the inherent instabilities of having too much dependence on intermittent and unforeseeable sources.

Another challenge of Europe’s growing dependence on renewable energy is far more serious: the potential loss of reliable electrical supply. It’s one thing to ask consumers to pay more for cleaner energy; it’s another to force them to endure blackouts. …..

……. Grid operators generally rely on coal and nuclear plants to meet baseload demand while modifying gas and hydroelectric power output to meet shifting demand. But electricity from wind and solar is variable and intermittent. Nature determines when and how much power will be generated from available capacity, so it is not necessarily “dispatchable” when needed.

When intermittent renewables are small players in the grid, they can be easily absorbed. But as they reach European levels of penetration, the strain begins to show. There are increasing reports of management challenges resulting from wind and solar across the European grid, including frequency fluctuations, voltage support issues, and inadvertent power flows. Anxious operators are concerned about potential blackouts.

In an April 17, 2012, letter to EU Commissioner for Energy Gunter Oettinger, for example, Daniel Dobbeni, the European Network of Transmission System Operators president, said grid operators are “deeply concerned about the difference in speed between the connection of very large capacities of renewable energy resources and the realization in due time of the grid investments needed to support the massive increase of power flows these new resources bring.” He also expressed great concern “about the potential destabilizing effect of outdated connection conditions for distributed generation that are not being retrofitted anywhere fast enough.”

The article continues with a warning to the US about unhealthy subsidies.

There is also an important lesson in the European experience with energy subsidies: Focus incentives so they reward the right behavior. Lavish subsidies for wind and solar have changed Europe’s generation mix, but the costs have been high because the subsidy structure prioritized mass deployment rather than efficiency, reliability and innovation. Even in the U.S., the wind-production tax credit has occasionally produced “negative pricing”—that is, turbine operators pay grid operators to take their power even though it isn’t needed, just so the wind generators can collect tax credits.

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Posted in Alarmism, Climate, Energy, Renewable Energy | 1 Comment »

Czechs jump off the renewables train to nowhere

July 30, 2013

From Power Engineering:

The Czech Republic’s government has voted to end support for renewable power generation in a bid to reduce rising consumer electricity bills.

The law proposes to stop subsidies for new projects and goes in to effect from 2014.

Subsidies for renewable-power sources have raised prices for Czech energy users in the past three years as the cost is passed on through customer bills.

Prime Minister Jiri Rusnok said in the statement, that rising electricity prices “threatens the competitiveness of our industry and raises consumers’ uncertainty about power prices.”

Only hydro, wind and biomass power plants that got construction permits in 2013 will be eligible for support if they’re completed before the end of 2014, the statement said.

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Posted in Czech Republic, Economics, Energy, Renewable Energy | Comments Off on Czechs jump off the renewables train to nowhere

Desertec Foundation deserts the Desertec project consortium

July 2, 2013

It was always too grandiose for its own good. The economics were never sound but it was “visionary” and it was riding the fashionable “renewables wave”. It seemed to be much more of a public relations exercise to win brownie points than any real project. Domestic German politics and positioning of German companies in North Africa and the Middle East was of more interest than any real commitment to the project itself.

The concept was to generate solar and wind power in the worlds deserts and the transfer them by HVDC links to populous regions upto 3000 km away! The Desertec Foundation started in January 2009 and the Desertec project consortium (Dii gmbh) was established in October 2009 to handle the specific project for generating solar and wind power in North Africa and the Middle East for export to Europe. Now the Desertec Foundation has left the consortium and it is likely that the project and the consortium will quietly disappear into the sand.

DESERTEC-Map_small

PV Magazine: Uncertainty shrouds the future of the Desertec project to generate energy from the world’s deserts after the foundation which developed the idea announced it had withdrawn from the scheme.

The Desertec Foundation was founded in January 2009 with the idea of generating solar and wind energy from the world’s deserts. The founding principle of the foundation is to use high voltage DC current – which loses only 3% every 1,000km it travels – to bring power to the 90% of the global population living within 3,000km of deserts.

In October 2009, the Dii GmbH consortium was founded in Munich to bring the concept to life using the deserts of the Middle East and north Africa, with the aim of supplying up to 15% of Europe’s energy from renewables by 2050.

But in an extraordinary press release, the Desertec Foundation has announced its withdrawal from the consortium, citing ‘irresolvable disputes’ with its partners over strategy, obligations, communications and ‘last but not least, the managerial style of Dii’s top management.’

(more…)

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UK PAC – Wind farm licences are “too generous for the limited risks”

January 14, 2013

The UK PAC calls the over-generous wind farm licences as being shocking. The consumer will just have to pay higher prices.

The problem with subsidies is that it nearly always leads to the subsidies being milked for the benefit of the few and the cost is borne by the many.  The purpose of the subsidy is never usually achieved (unless the benefit is taken to be the windfall that a few enjoy).  Now the UK Public Accounts Committee points out the many blunders in wind farm licencing which will cost the consumer some £17 billion — but the money goes to those investors who got in early!!

There is nothing wrong with wind power per se and it surely has a limited contribution to make. But it is just not commercial or practical for base-load power generation and no amount of subsidy will make it so. I can’t help thinking that the few investors who benefit – directly or indirectly – have close friends among the powers that be that establish the generous subsidy rules. The subsidies are justified on the basis of “reducing carbon footprint” which is meaningless.

The PAC has published its 20th report of this session on offshore electricity transmission (full report pdf here).  The Committee had taken evidence from the Department of Energy and Climate Change, the Gas and Electricity Markets Authority, and industry representatives on the new licensing regime for offshore electricity transmission.

“Not only is it unlikely that this new licensing system for bringing electricity from offshore wind farms onto the national grid will deliver any savings for consumers, it could well lead to higher prices”. ……

….. Margaret Hodge was speaking as the Committee published its 20th Report of this Session. The Department and the Gas and Electricity Markets Authority (the Authority) have introduced an elaborate regime that licences operators of offshore electricity transmission assets following competitions. The terms of the transmission licences awarded so far appear heavily skewed towards attracting investors rather than securing a good deal for consumers.

The transmission operators receive their income from the National Grid which recovers its costs from electricity suppliers and generators. Although all concerned state that no public funds are directly involved, the future payments to licensees, which will amount to around £17 billion, will in fact be passed onto consumers through electricity bills.

The investors’ estimated returns of 10-11% on the initial licences look extremely generous given the limited risks the investors bear. Licensees are guaranteed a fully retail price index-linked income for 20 years regardless of the extent to which assets are used. Yet penalties are limited to 10% of expected income in any one year if the operators fail to provide the transmission facilities when required.

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Posted in Alarmism, Energy, Renewable Energy, UK, Wind power | 2 Comments »

Kyoto protocol fails in all ways: Goals not achieved and for something utterly unnecessary

January 1, 2013

A failure of something utterly unnecessary ought to be a success. But the damage caused by the pursuit of meaningless goals for unsound reasons has been immense.

The Kyoto protocol was adopted in 1997 and came into effect in 2005.  “The controversial and ineffective Kyoto Protocol’s first stage comes to an end today, leaving the world with 58 per cent more greenhouse gases than in 1990, as opposed to the five per cent reduction its signatories sought”. 

It has been a solution addressing the wrong problem.

Kyoto Protocol aimed for 5% cut in carbon emissions — instead, we got a 58% increase

But in spite of this increase global temperatures have flattened out and may even have decreased slightly.

Global warming stopped 16 years ago

And all that has been achieved is that electricity prices have increased to pay for the massive subsidies for chasing a mirage. The financial crisis was not caused by the Kyoto Protocol but the crisis has certainly been prolonged and the recovery has been delayed by unnecessarily high electrical prices.

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Low energy prices with shale gas leading to shift of jobs from Europe to US

December 28, 2012

It is inevitable that investment and jobs – and especially in energy intensive industries – will migrate to regions of low energy costs. Over the next few years the lead that the US has developed over the rest of the world in the exploitation of shale gas will cause European companies to shun the high energy costs at home and shift to the US.

Reuters: Austria’s group Voestalpine is considering a plan to build a $1 billion plant in the United States that would convert iron ore into concentrate used in steelmaking, Trend magazine reported. ………. Trend said the plant was envisioned for a coastal city in the southern United States, given cheap and reliable supplies of natural gas, political stability and efficient port infrastructure.

And the problem has been the unnecessary and misguided European obsession with chasing a mirage.  A meaningless and unjustified pursuit of “low carbon” energy; profligate subsidies for ineffective renewable energy; wasteful – and eventually corrupt – attempts to bias the market with carbon credits and the shutting down of perfectly viable coal and nuclear power plants has given the highest energy costs in the world. Gas prices in Europe are 4 or 5 times as high as in the US. Europe has plenty of shale gas potential but development is lagging far behind the US largely because of the political opposition from the “Green” lobbies. As the New York Times reports:

High Energy Costs Plaguing Europe

.. Asked whether he had considered building the plant in Europe, Voestalpine’s chief executive, Wolfgang Eder, said that that “calculation does not make sense from the very beginning.” Gas in Europe is much more expensive, he said.

High energy costs are emerging as an issue in Europe that is prompting debate, including questioning of the Continent’s clean energy initiatives. Over the past few years, Europe has spent tens of billions of euros in an effort to reduce carbon dioxide emissions. The bulk of the spending has gone into low-carbon energy sources like wind and solar power that have needed special tariffs or other subsidies to be commercially viable.

“We embarked on a big transition to a low-carbon economy without taking into account the cost and without factoring in the competitive impact,” says Fabien Roques, head of European power and carbon at the energy consulting firm IHS CERA in Paris. “I think there will be a critical review of some of these policies in the next few years.” 

Both consumers and the industry are upset about high energy costs. Energy-intensive industries like chemicals and steel are, if not closing European plants outright, looking toward places like the United States that have lower energy costs as they pursue new investments.

BASF, the German chemical giant, has been outspoken about the consequences of energy costs for competitiveness and is building a new plant in Louisiana.

“We Europeans are currently paying up to four or five times more for natural gas than the Americans,” Harald Schwager, a member of the executive board at BASF, said last month. “Energy efficiency alone will not allow us to compensate for this. Of course, that means increased competition for all the European manufacturing sites.”

And it beomes increasingly clear that the chase for politically correct “brownie points” by European  governments as they have demonised carbon dioxide quite needlessly while spending massively on renewable subsidies is not sustainable. Just as Japan must now waste political energy in “reviewing” their hasty decisions about the use of nuclear energy after Fukushima , Europe will have to spend the next decade in “reviewing and reversing” the spate of bad decisions made based on climate alarmism.

The expansion in renewables will probably ensure that Europe will meet its target of reducing greenhouse gases 20 percent from their 1990 levels by 2020. But it has been a disappointment on other levels. For one thing, emissions continue to rise globally. In a sense, Europe is likely to have exported its emissions to places like China, where polluting economic activity continues to increase while the European economy stagnates.

A striking indicator that the European effort has not achieved all that it intended to is the continued rise in the burning of coal, by far the biggest polluter among fossil fuels.

The International Energy Agency, a Paris-based group formed by consumer nations, recently said that coal was likely to catch up with oil as the world’s largest source of energy in a decade.

Much of the increase in coal use can be blamed on China and India, but not all of it. Europe has increased its coal use this year, and that has led to an increase of about 7 percent in carbon dioxide emissions from power generation, according to IHS. Coal use is increasing in all regions except the United States, the I.E.A. said.

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Posted in Alarmism, Energy, Europe, Gas, Politics, Renewable Energy, US | Comments Off on Low energy prices with shale gas leading to shift of jobs from Europe to US

Wind farm performance declines by a third in just 10 years

December 20, 2012

The intermittent nature of wind and the speed restructions on wind turbines means that the load factor of wind farms is low to begin with (about 20 -25% for on-shore units and about 35-40% for off-shore units). But this is only when they are new. They seem to age very rapidly. This study of UK on-shore plants and Danish on-shore and off-shore plants shows that

  1. Wind farms age rapidly with on-shore plants declining in performance by about one-third in 10 years and off-shore plants declining by over 60% in 10 years, and
  2. The economic life of a wind farm is, at best, around 15 years and not the 25 years considered “normal” for a power plant

REF’s press release:

The Renewable Energy Foundation [1] today published a new study, The Performance of Wind Farms in the United Kingdom and Denmark,[2] showing that the economic life of onshore wind turbines is between 10 and 15 years, not the 20 to 25 years projected by the wind industry itself, and used for government projections.  

The work has been conducted by one of the UK’s leading energy & environmental economists, Professor Gordon Hughes of the University of Edinburgh[3], and has been anonymously peer-reviewed.  This groundbreaking study applies rigorous statistical analysis to years of actual wind farm performance data from wind farms in both the UK and in Denmark.

The full report is available here.

The Executive Summary states.

1. Onshore wind turbines represent a relatively mature technology, which ought to have achieved a satisfactory level of reliability in operation as plants age. Unfortunately, detailed analysis of the relationship between age and performance gives a rather different picture for both the United Kingdom and Denmark with a significant decline in the average load factor of onshore wind farms adjusted for wind availability as they get older. An even more dramatic decline is observed for offshore wind farms in Denmark, but this may be a reflection of the immaturity of the technology.

2. The study has used data on the monthly output of wind farms in the UK and Denmark reported under regulatory arrangements and schemes for subsidising renewable energy. Normalised age-performance curves have been estimated using standard statistical techniques which allow for differences between sites and over time in wind resources and other factors.

3. The normalised load factor for UK onshore wind farms declines from a peak of about 24% at age 1 to 15% at age 10 and 11% at age 15. The decline in the normalised load factor for Danish onshore wind farms is slower but still significant with a fall from a peak of 22% to 18% at age 15. On the other hand for offshore wind farms in Denmark the normalised load factor falls from 39% at age 0 to 15% at age 10. The reasons for the observed declines in normalised load factors cannot be fully assessed using the data available but outages due to mechanical breakdowns appear to be a contributory factor.

4. Analysis of site-specific performance reveals that the average normalised load factor of new UK onshore wind farms at age 1 (the peak year of operation) declined significantly from 2000 to 2011. In addition, larger wind farms have systematically worse performance than smaller wind farms. Adjusted for age and wind availability the overall performance of wind farms in the UK has deteriorated markedly since the beginning of the century.

5. These findings have important implications for policy towards wind generation in the UK. First, they suggest that the subsidy regime is extremely generous if investment in new wind farms is profitable despite the decline in performance due to age and over time. Second, meeting the UK Government’s targets for wind generation will require a much higher level of wind capacity – and, thus, capital investment – than current projections imply. Third, the structure of contracts offered to wind generators under the proposed reform of the electricity market should be modified since few wind farms will operate for more than 12–15 years.

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Posted in Denmark, Energy, Renewable Energy, UK, Wind power | Comments Off on Wind farm performance declines by a third in just 10 years

Retired High Court judge accuses Danish government of corruption over wind turbines

November 21, 2012

The Danish love of wind turbines  – sometimes bordering on the irrational – is well known. That is also why they have the highest prices for electricity in Europe. That Denmark is also considered one of the least corrupt countries in the world is taken for granted. But apparently things are not always what they seem. The Copenhagen Post carries a remarkable article by Peter Rørdam, a retired High Court judge which offers a peek behind the scenes at chicanery in the wind industry/government nexus. The article is reproduced below:

The Copenhagen Post

The myth of Denmark as a corruption-free country

It’s a widely held conception that Denmark is one of the world’s least corrupt countries. The message is always warmly received, but this isn’t the same as saying that Denmark is free of corruption.

(more…)

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Hard times forces a measure of realism into the mirage that is renewable energy

September 30, 2012

As the financial crisis continues, countries – one after another – are finding that the cost of pandering to environmental correctness is unacceptable. Renewable energy is proving to be unsustainable.

  1. Poland: The government moves to overhaul its system of support for green energy by effectively cutting funding for onshore wind.
  2. Greece: Greece has slashed the guaranteed feed-in prices it pays to some solar operators and is no longer approving permits for their installation.
  3. Switzerland: Switzerland plans for using more gas until 2050 and “energy needs can be completely covered by renewable energy”.
  4. Spain: Government has introduced a new tax on electricity production revenues to try and curb Spain’s current energy sector deficit caused mainly by the government’s renewable subsidy program.
  5. UK: UK cuts feed-in tariffs for Solar panels.
  6. Germany: Germany to press on with energy changes to the renewable subsidy system and with the easing of environmental over-regulation to rein-in renewable energy costs.
  7. Australia: Victoria cuts solar subsidies as the amount paid to new solar customers for power sold to the grid will be reduced from 25 cents to eight cents per kilowatt-hour.
  8. US: Tax breaks for wind energy to be curbed. Hopes that wind power could be competitive without any subsidy have been dashed by the plunge in North American natural gas prices.

Subsidies for what are essentially inferior products for electricity generation are ineffective.  Subsidies for what are misguided objectives are just not sustainable.

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Posted in Alarmism, Energy, Renewable Energy | Comments Off on Hard times forces a measure of realism into the mirage that is renewable energy

Solar Energy is in crisis

September 20, 2012

The solar energy industry is in crisis and I keep reading that it is because subsidies are being reduced or eliminated. As if subsidies come for free. I don’t believe subsidies work and the current crisis only proves that the fundamental issue is not subsidies but that solar energy is not (yet ?) commercially viable. It surely has a place in some very particular situations and the best use of solar energy remains with some isolated users or as a “support” for other energy sources. But for base-load power generation it is just  not viable.

Peter Glover writes in the Energy Tribune:

The global solar power industry is in crisis. The industry blames widespread national subsidy cuts and over productivity; China, in particular, being widely vilified on the second count. However, the real cause of the solar industry’s malaise runs deeper, rooted, as it is, in the inescapable fact that, in terms of current technology, commercial scale solar energy remains a non-viable proposition.

(more…)

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