Friday, April 14, 2017

Renewbles Going into 2017

2017 and the new administration is creating a Maginot Line in the fight for clean sustainable energy in the US.  Alternative facts, half truths, and deliberate misstatements have really been with us for a long time, especially with regards to renewable energy and its counterpart, the fossil and nuclear industries.  The perceived backtrack on renewables in favor of coal as a foundation once again in our electricity generating future is one of the most blatant lies. The battle is coming to a head within the next few years, as basic economics and the marketplace, and not politics, determine the direction of electricity generation and the fuel for transportation vehicles.  These are currently the two big users of the traditional hard energy.  Renewables are charging full speed ahead, and it’s because of economics.  Over the past few months there have been many reports and sources documenting the exponential growth of megawatt capacity and very large number of jobs currently in the solar and wind sector.

For the past 20-30 years, THEY (and I’m going to lump all the conservative economists, industry leaders, think tank analysts, and politicians) have said solar is too expensive, and the cost of solar cells needed to decrease to 50 cents/watt to be competitive.  Today, those costs are between 25-25 cents/watt, and are continuing to decrease.  The cost of the equipment (the power plant) is decreasing, along with the O&M (fuel, operating, and maintenance costs).  Today, renewables are the cheapest path to electricity, even without subsidies, when all the true costs are taken into account.

Here are some of those alt-truths. THEY told us that solar panels would not last over 20 years, and thus when they were amortized over their lifetime, they were just too expensive.  Today’s reality is that solar panels will last a long, long time.  Manufacturers are warranting them for 25+years, and most say that a good panel may even last “forever” since there are no moving parts.  The framework and glass encapsulation materials have gotten better; and as with anything, a well made product can live up to industry expectations.  If a solar array is amortized over 30-40 years, as most industrial power plants and other facilities, the true cost is reduced.  Add to that the fact that there is no fuel cost, and that there is minimum maintenance, and the cost over that “lifetime” is really low.

Since the sun’s energy is not available 24/7, a 33% capacity factor is relatively valid.  But what has not been readily discussed is the value of the electricity produced during the day, when the greatest demand (peak power) required the purchase of expensive “peakers” electricity…usually gas fired turbines which would run for very short periods of time during the day and throughout the year.  A lot of those have a lower capacity factor; yet they have been constructed and sit idly by.  Solar is slowly surpassing the need for this expensive electricity, as seen just recently in California where there was so much free/solar electricity available for about six hours, resulting in a negative price for wholesale electricity for a certain time of that day.

Renewable technology will continue to expand, with increased efficiency, lower production costs, and new products and applications such as Tesla’s solar roof shingles (“Would you like a roof that looks better than a normal roof, last twice as long, cost less and by the way generates electricity, and that’s including the labor costs and without subsidies for solar.”) The ultimate realization that solar has minimal Operating and Maintenance costs (fuel, maintenance, replacements, and operational labor), can be placed literally anywhere there is a beam of sunlight, the integration of vast new electricity storage components, and the inevitable upgrades and modernization of the Grid, all make the future look very bright. 

Of course there are many obstacles and problems ahead.  Some of THEY worry that as the costs come down, there won’t be any incentive to invest and make money.  Electricity will be too cheap to meter!  Some utilities continue to fight the integration of solar into their ancient and out-dated business models.  Wyoming and Indiana are trying to outlaw solar (it is un-American, whereas coal is) by placing heavy taxes on its production.  PG&E in California is leading the way in re-thinking, re-organizing, re-structuring it’s entire operations…from shutting down it’s 2000MW baseload Diablo Canyon reactors, to modernizing how available electricity is distributed from where it is produced to where it is needed.

The bottom line is that we have reached the point TODAY where renewables are cheaper, cleaner, afford individual freedom of choice, and require less government regulation.  It is a shame that the greed and simple mindedness of our current political powers are letting America’s leadership in clean sustainable energy and its economic benefits slowly slip away.  But the sun will continue to shine and the wind will blow, and the enormous potential is still there!

An interesting article snuck into the relatively conservative “The Economist” last December kind of broke the old mold:

Friday, March 10, 2017

New Energy Era - 2017

Just a quick update on where energy policy and development is at now, with the new administration’s blatant shift away from acknowledging and working towards solutions to the global issue of climate change.  Ignoring climate change will not make it going away; and as model predictions of increasing climate extremes continue to come true, the economic, as well as environmental and social impacts, will continue to escalate until it can no longer be ignored.  The basic reason for all this denial has always been the economic threat to the fossil fuel industry.  However, today’s bottom line is that renewables are NOW the least cost technology for generating electricity, on par with natural gas, and well outpacing the increasing costs of coal and nuclear.  This is already beginning to cut into the coal and oil’s once dominance in electricity generation and transportation. In this piece, I will focus on nuclear, the third component of “big” industry’s stranglehold on energy policy.
The nuclear renaissance is basically dead.  Like a slain dinosaur, it just keeps thrashing its tail with hopes of new profits for the industry.  The bottom line is cost.  No new reactors have been ordered in over ten years, and several supposed advanced technology reactors are falling off the drawing boards in Florida and South Carolina.  One of the last “hopeful” plans is a reactor in Virginia, now estimated at $19b!! The new small modular reactors are still years away from even scaled up models for testing and licensing.  The fact is that by the time they do become available, their needs for all the infrastructure of uranium mining, enrichment, fabrication, steam generators, low and high level waste management and disposal, as well as the declining need for base load power, will make them unaffordable compared to renewables with storage and natural gas backup (1).  The same hold true for thorium and even fusion.  Nuclear technology is overkill…just to boil water…as Amory Lovins said “it’s like cutting butter with a chain saw!”  Yes, in time we will build some of these advanced projects, but they will never approach the capacity, which renewables will supply in generating electricity.
The big problem today is what to do with the 95+ reactors currently in operation in the US,  as they begin to reach the end of their useful life.  The cost of maintaining them is increasing, making them basically uncompetitive in today’s market (2).  The recent revelations of Toshiba-Westinghouse losses of $6-8 billion has rattled world markets, the problems with France’s Areva and EDF’s state of the art reactors in Finland and France, and the economic changes caused at Hinkley due to Brexit are all weighing heavily on the global nuclear industry. Again, this is all due to exorbitantly increasing costs, in the face of rapidly decreasing costs for renewables.  California is again leading in the shift to a sustainable renewable future with its plan for shutting down its twin reactors at Diablo Canyon.
Meanwhile, no progress had been made in radioactive waste storage.  The industry is now drooling at the huge upcoming market in decommissioning.  A lot of companies, such as Energy Solution, are pushing into the waste storage arena, hoping for Congressional approval to create of a centralized, monitored spent fuel cask site probably in Texas or Utah.  This is going to be a tough sell, since it was tried back in the early 90’s and failed for numerous environmental and safety reasons.  The new push for Yucca Mountain will reveal the same technical problems identified earlier that make that site unsuitable.  In a couple of months I will partake in a hearing looking into putting casks in the deep ocean bottom muds off the California coast.  Absurd!  As I’ve said before, there is no solution to high level waste storage other than keeping it on site at the various locations in well designed and built casks that can be monitored and upgraded over the millennium.
The news from Fukushima is overwhelming.   The ice wall proved to be a $300m fiasco, and the fact that there was a complete meltdown creating radiation levels so severe that even robots can survive more than a few minutes suggests that this accident will never be cleaned up and will continue to pollute for tens of thousands of years (3).  Sad!
On a positive note, Humboldt Bay is in the final phase of its $1.1b cleanup, and the last of the 4000 truckloads of contaminated soil should be off our highways by next March.  Interesting that Highway 299 has been closed since last November…that was the cheapest and most direct route to the railhead in Redding.  I’m waiting for an update.
Again, it is economics and not the environment, or safety, or the social/moral/ethical issues that is playing havoc with the nuclear industry.  It is a dangerous and complex technology, which achieved its status only because of the tremendous profits, afforded to the powerful military/industrial complex.  CEOs are still making money today, planning for reactors, which will never be built.  And the public, in its apathetic ignorance, continues to pay for it.
Depending on who/what/where you get your information, the true facts have always been out in the open.  It depends on what you read and believe.  Two recent articles display this.
And from the right wing Daily Caller, some real optimism.  Andrew has been so wrong so many times!

The bottom line is that nuclear will not play a new or substantial role in our energy future.  Renewables, storage, efficiency, and a modern grid system are already making headway.

Some background:

If you need more references to issues, which you cannot find yourself, please ask and I can refer you to my sources.  Or check with Fox and BreitBart!

Friday, December 30, 2016

Some Thoughts as We End the Year

A few thoughts as we end the year.  As we enter a new “reality” in US energy policy, the overwhelming consensus is that human induced climate change is real, and burying heads in the sand will not make it go away.  The hoax has been the product of millions of dollars and a well orchestrated plan to deceive, provide misinformation, and outright lie to confuse and keep the populous ignorant, so that the fossil fuel industry can continue their power and wealth accumulation.  Those folks are now at the helm, and what will happen is anyone’s guess.  At some point, the economic repercussions of the increasing extremes in weather, ecosystem disruption, and human well being will override the political neglect.

Solar and wind are not dead!  They will suffer some setbacks, but the bottom line is that they are now competitive (even without subsidies) with most any other form of electricity generation, and with continued technological developments and the implementation of storage, they will continue to provide more and more of our energy demands.  “In the end, for the political class it's all about money and votes,” said Mark Barteau, director of the Energy Institute at the University of Michigan-Ann Arbor. “Coal is dying and renewables are surging, and that is not going to change. Once this bunch figures out where the dollars and jobs are, they will follow.”  Business, industry, and individuals will continue to invest in self-generation, especially as the traditional utility model begins to unravel.  The past few years, we have seen reduced demand to electricity due to efficiency, changes in living patterns, and a decline of the traditional huge demand by industrial production.  Couple that with the overabundance of oil and gas, and we have some pretty low energy prices.  This does not bode well with the energy industries, which require higher prices to accumulate higher profits.  Drill, baby, drill!  That didn’t work out so well for the oil and gas folks.  In California, we’re paying 19 cents/KWH…averaging out the high cost of nuclear from Diablo Canyon, the low cost of old hydro, the declining cost of solar and wind and the “low” cost of natural gas.  The price of gas goes up…KWH prices go up…cheaper to generate your own!

Nuclear is dying an exponential death.  Nukes around the country (as well as the world) are shutting down, and even with those under construction, it will not play any bigger role in our energy future.  High construction costs, high maintenance and replacement costs, no real solution to the huge waste problems, and even the false promise of “carbon free” electricity…all have the nuclear industry in dire straits.  Toshiba just announced a $85 billion loss for this year, the escalating cost of decommissioning Chernobyl, the unknown reality of what to do with Fukushima, and the increasing need of subsidies and bailouts for nukes here at home all sour the economic hopes of the nuclear industries.  It will be interesting to see how the fossil fuel boys play with the nuke boys in this new political environment.

The new technologies of small modular reactors, advanced reactors, and even fusion will not gain in status because they are too expensive, especially as the costs of renewables continue to fall.  We will see amazing new technological developments, but they will most likely be “sunlight” oriented.

The US has always been a major force in world energy and economic policy.  However, a digression from the huge potentials of renewable energy back to the old coal and oil days will place us in an interesting position in the world economy.  The move forward by China, India, Europe, as well as he developing world, will leave us behind in many respects.  Just as television revolutionized the world in the 50’s and 60’s; personal computers in the 80’s and 90’s; and cell phones and the internet in the 00’s to now, renewable energy has the potential to provide affordable energy, jobs, a cleaner environment, and a sustainable future, while giving consumers a more democratic say in the process.  What happens will be very interesting, for the battle is really no longer about jobs vs. the environment, but oil vs. the sun.  (Remember hydrogen!)

If you want further information on any of these summations, please let me know, and I will provide references to the left wing, liberal, biased, lying, tree-hugging media and journals that I read!

A couple of recent pieces on nuclear:

Happy New Year!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Friday, December 2, 2016

Entering 2017...a new era

Susan and I are off to the Bahamas for a week, where we hope to isolate ourselves from the “reality” that is occurring in America and the rest of the world.  As 2017 looms, interesting changes will most probably happen in everything, especially in energy policy and deployment for the next few years.  The new administration’s apparent rejection of climate change will have an impact on the inevitable transition to renewables.  How much of a setback will depend on many factors.  First of all, calling climate change a hoax does not make it go away.  As I said before, the biggest “hoax” has been the deliberate suppression and obstruction campaign hosted by Exxon, the fossil fuel industry, and the media.  Eventually, the US will join the rest of the world when the true economic, social, and political costs of ignorance and greed overwhelm the increasing damages that will happen to the planet. 

The dream that we will go back to burning coal, and increasing our use of oil, flows contrary to what is happening here and around the world.  “The renewable train has already left the station!” Renewables are already cheaper than most hard technologies, even without subsidies; and the “old” jobs saved or created can’t equal the huge potential of good, clean, local jobs.  Again, it’s a matter of who profits most…huge corporations or the 90% of people who want to work and have a fair chance in life.

As for the nuclear industry, things look grim, in spite of all the positive spin being thrown out there.  The “carbon-free” advantage just went out the window.  Finishing the four reactors under construction, the hope of new small modular reactors, thorium and advanced breeders, and even fusion will never happen because of the enormous costs associated with not just their development, but also with their necessary infrastructure and wastes.  Reprocessing is the basis of most of these new technologies, and it is very complex and expensive in so many ways, that without huge government subsidies, they won’t even begin to compete with the near term development of cheaper renewable generation and storage.

Then there is the issue of nuclear wastes.  A brief overview of some of the current issues show that costs will begin to mount astronomically, because we really haven’t addressed them in the past.  The new official Japanese government cost estimate for Fukushima has just risen to over $178 billion, and they still don’t know what they are going to do.  Check out the video (link below) of the new $1.5 containment structure for Chernobyl, which should enshroud the facility for 100 years; whether any progress on melted fuel removal occurs in that time frame is anybody’s guess, as well as at what cost.  The $2 billion accident at the 15-year old WIPP waste site in New Mexico sends our scientists back to the drawing board.  The cleanup of the radioactive dump in St. Louis, and the never-ending mess at Hanford, have both been pushed forward for 40+? years.  The new interest in Yucca Mountain does not change the scientific, technical, and social problems that need to be overcome.  Europe is experiences similar economic and technical obstacles to their nuclear programs.  In spite of the media push by the industry (the recent headlines of a diamond/nuclear waste battery solving the waste problem is absurd), it’s the same misinformation (post truth, or whatever you want to now call it) playing on the emotions of the ignorant masses wanting simple solutions to very complex and expensive problems. 

On a positive note, the Humboldt Bay Nuclear Power Plant is now in its final major decommissioning phase.  Everything above ground has been pretty much deconstructed and trucked off to Texas and Utah. The remaining below grade contaminated concrete reactor caisson, as well as the soil, will be removed from a hole 120 feet in diameter, and 190 feet deep.  All this will be sorted, packaged, and shipped away. This phase will cost about $300 million, involve about 3000 truckloads to Texas, and take another 15 months to complete.  Following that, final site restoration work will begin in earnest.  Surprisingly PG&E is still near the estimated budget of $1.18 billion.

Another bright note is that in spite of our tax dollars being spent on these fiascos, the future of a lot of our electricity use will be dictated by businesses (like Apple, Google, GM, Walmart, etc, who find it cheaper to generate their own electricity), individuals who will cut into utility profits with their small rooftop systems, the growth of local community based generation, and the huge savings from energy efficiency.  I am fortunate to live in California, which through its example, will lead the nation forward.  There are going to be major changes, and it’s too bad a lot of our tax dollars probably won’t be directed to this clean, affordable, and sustainable future.  As usual, I am optimistic that people will eventually figure out that the quality of the water they drink, the air that they breath, and the landscape they pass on to their children is worth more than the corporate profits of the few.  It’s called a revolution, and the citizens are arming themselves in more ways than one.

Power to the people; and God bless America!

Just a few:

Thursday, September 8, 2016

Rooftop Solar as a Finacial Investment

One of the biggest obstacles to the deployment of solar energy, especially in small-scale residential systems is the lack if accurate and up to date information.  The powerful fossil fuel industry has done a marvelous job with the media over the years, denouncing climate change and the potentials that renewables offer in creating the transition that ultimately will occur.
Recently Donald Trump pooh-poohed solar with a shrug saying "an 18 year payback...come on!"  A retired friend in the Sacramento area said he would love to go solar, but it would never pay for itself in his lifetime.  Another person asked what the payback period was on my personal system, and adamantly said that number was the most important number in the solar discussion.  What they are missing is an understanding of what that number really means, and how its value measures up with today's financial investments.
Let's analyze what an 18-year payback period for a certain dollar investment in a solar system means in a grid-intertied system.  During the day, electricity is produced, and is used to run our appliances and other electric loads as needed.  We are producing our own electricity, and saving the cost of buying what we need at that time from our utility.  If we produce more than what use, the excess is fed into the grid, essentially running the electric meter backwards and giving us a credit.  We are getting money one way or another for what the electricity produce.  We could store our excess in batteries, but in reality, a grid-intertied system is very simple “storage system,” and ultimately has major benefits for all.  At night, or when conditions demand more electricity than what we can produce at that time, we buy KWHs from the utility, just as always.  Your meter is a two-way portal. How much we produce relies on how large a system we install, what the weather conditions are during that day, what the "solar window" looks like on our roof with regards to southern orientation, shading from tree or buildings, and the season...more and better sun in the summer months than in the winter…and a variety of factors.
The dollar value of the solar electricity produced depends on many variables, mainly in which state you live in.  Like property taxes, sales taxes, and income taxes, each state and its utilities varies greatly in what it "pays" for solar generated electricity.  This is a very large problem...often a huge many places, and political battles are being fought in Nevada, Florida, and Arizona, where there is a huge abundance of solar potential that is being squashed by the energy industry's effective lobbying.
Let's focus on California, and my utility...PG&E.  The setting of utility rates for various users by the state PUC is virtually incomprehensible; but for my energy account, the cost of a KWH is atg the moment 18 cents.  This price includes the cost of electricity generation (bought on the wholesale market), transmission and distribution, taxes, insurance, special programs, nuclear decommissioning, wages and CEO salaries, shareholder dividends, and all the other costs associated with doing business.  When I use one KWH from PG&E, my meter records it, and  18 cents is added to my monthly bill.  When I put a KWHfrom my solar system back into the grid, running the meter backwards, I am paid 18 cents.  This is called net-metering, and is a huge issue in the solar debate, since the average wholesale price nationwide is somewhere between 4 and 10 cents/KWH depending on where you are, and when you are using that electricity.  Utilities complain that they are paying way more for that residential solar than what they could buy on he open market, and that the solar generators are not paying their fair share for the other costs of the grid. Fair enough...non-solar producing customers are subsidizing solar generators.  Arizona and Nevada, the loudest complainers, moan the fact that less than 4% of their customers are on solar…a huge burden on them and their ratepayers.  What about all the subsidies to nuclear, natural gas, and coal?  The utilities should be the ones "owning" the solar systems so they could control the flow of electrons and reap the benefits.  But that's another story.  So in California, at least for now, you size your system to produce as much electricity as you want, but try NOT to exceed 110% of what you use in a year.  If you produce more than that, PG&E will pay you about 6 cents/KWH for that excess electricity (the wholesale price), and not 18 cents.  Again, fair enough for now.  A friend has a great solar site, has a huge system producing way more than he uses, and got $212 from PG&E.  They certainly wouldn't want everyone to become individual power plants; that would add competition and muddle up their traditional business model.  Things, of course, are in flux, especially with businesses, such as Apple and Google, who can now sell their excess electricity on the open market.  This all is very complicated stuff, and will eventually get worked out as more and more people and businesses go solar, and as storage comes on line down the road, and the cost of baseload nuclear and coal continues to climb.  But for now, my 3.7KW system is estimated to crank out about 90% of my annual electricity demand.
My system cost around $13,000 after tax credits, etc.  I preface this by saying I could have gotten it cheaper, but as with almost anything we buy such as cars, cameras, cell phones, etc., there are many personal choices and decisions to be made as to how much money we spend.  My system should produce about 4000KWH per year.  At 18 cents/KWH, that’s $720 per year that stays in my pocket, not having to buy that equivalent amount of electricity from PG&E.  So what is the payback period?  18 years.  In 18 years, the system will have paid for itself.  Wow...I hope I live that long! 
Now let's look at this with a broader for view.  The $13,000 I INVESTED is giving me a fixed annual income return of 5.5%!!!!!!!!!  Is this significant?  I think so.  (See below for a discussion of investment percentages.) I recently asked a financial advisor if he could put some of my money in an income yielding investment that would give me 5% TAX FREE, and he laughed and said those days are long gone, and he could probably do around 3% taxable.  It's all Obama's fault; maybe after the election things might get better; blah, blah, blah!!!!  When I told him of my solar investment, he quickly changed the subject and blurted out "how 'bout them Giants...!"  He wouldn't even rationally discuss it because he probably didn’t understand the significance of it, or because it would strike at his heart having to realize his thinking has been wrong for so long.  He also can’t make any money advising it to his customers. So, according to him, if you have $10-15 thousand, put it in treasury bonds at 2%, or a money market for 0.8%?  You could put it into stocks that pay a dividend...PG&E is paying 3.5% (taxable), Exxon-Mobil 3.1% (taxable).  Payback period of about 30 years!  Even compounded interest, payback is about 20 years, and taxable.  With solar, and I'm not advocating investing in stocks of solar companies, you have a stable, fixed value investment that in my case gets better.  PG&E has raised the electricity rates three times since I put in my system, and filings with the PUC show that they will go up again in the future.  You don't have the worry of what the market will do, whether that stock price will go up or down, since the value and income is relatively long as the sun shines.  And after it has paid for itself, it will still be there generating dollars for years to come.
Of course, there is a lot of old information still floating around. “The system won't last 18 years, it’s too expensive, and something cheaper, like new nuclear or fusion, will come along, etc.”  Today's PV panels are very dependable (mine have a 25 year warranty), and experience is showing they will perform for 40 years, if not forever.  There are no moving parts, and the current degradation in the glass coatings is less than 0.4% year. The system is virtually maintenance free, other than a hosing down a couple of times a year.  My panels are 18% efficient under ideal conditions (18% of something free ain't bad, considering steam-generated electricity is about 33% efficient, and automobiles are around 18%.)  As the technology improves, increasing efficiency means less surface area is needed.  The 4 new panels I recently put up are the same size and cost the same as those I bought a year and a half ago…yet they put out 25% more electricity.  The technology and manufacturing processes are bringing down the cost.  Also, as with most economies of scale, the balance of system...inverters, racks, and even installation time and labor costs are coming down.  Lot's of beats working in a hole in the ground mining there's for a new bluegrass song!
I live in the heart of the Redwoods, three miles from one of the foggiest airports in the US.  My neighbor recently put a system on his house, and will soon install a 15KW system on his fish smoking business a few miles inland.  He said it was a no-brainier...after all the tax credits, business deductions, etc, it has an 8 year payback...12% return (tax free), and he has the satisfaction of doing the "right thing."  He is also getting an electric vehicle!
It's interesting how we don't really ask or talk about the “payback period” when we make other purchases.  You buy a new car, and of course you pay for what you want and can afford; and you hope that it will last X number of miles or for so many years.  You may even now be concerned with MPG or how much it might cost to operate.  And it depreciates in value the minute it leaves the dealer's floor.  Think about replacing your spend tens of thousands of dollars on a 20-30 year roof, which is basically worthless when the time comes to re-roof.  What’s the payback? Elan Musk recently said a lot of people spend money a on a new roof, then spend more money on a solar system to put over it...the solar system should be the roof, and the roof should not only pay for itself, but should make you money!  I saw several of these roofing systems in Northern Italy, but they haven’t caught on here in the US yet.  Just wait!
When the financial world finally realizes that solar, small and large, is an investment that makes money for the investor, things will really take off.  We already have opportunities to not only install on our own roof, but there are growing businesses that allow people who do no have an appropriate site, or are renters, to invest in systems on some roof somewhere when they want a safe, secure investment.  Companies now are "renting" your roof...paying for and installing systems, and reducing the homeowner's electricity bill.  If they can get 10-15% return, then they can afford to give you 3-4%.  Of course there will be scams, failures, and obstacles, but the bottom line is that the costs are coming down, clean electricity is being produced with free fuel, and individuals are allotted more personal freedoms.  A fiscal conservative’s dream!  A Koch brothers nightmare!  Power to the people!

Growth rates and Percentage

Things grow at various rates and percentages.  There are two main kinds of investments most of us make.  Here are some examples.
Simple percent rate, also called fixed income.  Let’s say you invest $1000 and get a rate of return of 5%.  That means at the end of the first year, you will receive $50, and you can go out and spend it however you want.  The same is true for the next year, and for each of the 20 years it will take to payback your original $1000 investment, $50 at a time.  That $1000 is working for you, and you can continue getting $50 a year as long as the % rate stays the same.
Compounded interest, or what most long-term investment vehicles offer.  Take the $50 you got from that $1000 investment, and instead of spending it, you leave it in the account.  Your investment is now worth $1050.  The next year the 5% pays you $52.50.  If you leave that in, your investment value is now $1102.50.  The next year, the value increases to $1157.63, and your money continues to grow at an exponential rate.  You’re getting 5% on your original investment plus all the interest it is accruing.  The time to double is a simple formula: T2=70/%, (in this case 70 divided by 5) so the value of the account will have doubled (will have paid for itself) in 14 years.  It will be worth $2000.
That is 6 years earlier than in the fixed income scenario; but you do not have access to the “interest” that it is making.  If you want your money to grow over a long period of time, ie, you’re saving for retirement, then this makes sense.  At a constant 5%, that $1000 will be worth $8000 in 42 years!  Put money in a money market account, and you might get 0.8%…better to put it in an account in the Caimans!
A solar system is a fixed income vehicle, giving you whatever percent the sun generates   from your investment, and once it has paid for itself, you still have the system making you money.  Hopefully you have spent the money you made each year wisely and have had a good time!

Wednesday, July 27, 2016

Reprocessing of Nuclear Wastes

I was recently asked a question about taking spent fuel rods from a nuclear power plant and converting them into “glass logs” fort storage.  Unfortunately, the answer to this is very complicated and requires a little bit of basic nuclear physics.

What uranium (U) is mined out of the ground, it is processed into uranium ore that contains 99.3% U238 (atomic weight), and 0.7% U235, which is the fissionable component used in reactors.  In order to produce fuel rods, the uranium must be “enriched” via centrifuge technology, separating out the heavier atoms from the lighter ones.  Commercial nuclear fuel is enriched to 3% U235 leaving the remaining U238 at 97%, while military fuel is enriched to a higher level.  This is a complex and expensive step in the nuclear fuel cycle, and has caused much concern with the Iran and North Korea nuclear programs.

Once inside the reactor, under the right conditions, several major things happen.  First, a U235 atom is split apart by a neutron (fission), releasing energy (heat), 2-3 new neutrons, and creating two new, smaller atoms (there are some 35 possible “daughter” product combinations) which are generally very radioactive.  The new neutrons can go on to fission more U235, creating a chain reaction.  However, some of them are captured by non-fissionable U238 atoms, becoming Plutonium (Pu239).  In about a year of operation in a reactor, the fuel becomes “spent” with a makeup of 96% U238, 1% Pu, about 2.5% radioactive fission (daughter) products, and about 0.5% unused U235.  This fuel rod is considered High Level Waste because of its high radioactivity from these fission products, and it must be cooled and shielded.  A spent fuel pool is generally used, since water is a good coolant and radioactivity moderator.  After about 5-6 years, most of the highly active products have sufficiently decayed, so the rods can be placed in heavily shielded lead/concrete casks (dry casks), and left out in the open air to dissipate their waste heat.  This is how Trojan, Humboldt Bay, as well as other plants are storing or planning on storing their High Level Waste.

However, Plutonium is a very valuable atom (it does fission under the right conditions) if you want to build a nuclear weapon, so Hanford was built in the 40’s with the sole purpose of producing spent fuel from which Pu could be extracted. Several reactors and huge structures (the infamous “canyons”) were built, shielding workers and the environment, where the fuel rods were dissolved in acids, and the Pu was separated out (Purex process).  The U238, as well as the small amounts of U235, was also extracted for possible re-use, leaving behind a soupy, corrosive liquid containing the high-level fission products.  These wastes were dumped into unlined tanks, which after 30-40 years began to leak, leading to the enormous task of remediation today.  The basic idea is to combine the radioactive sludge with sand, and heat (2100oF) it so it all melts together into a “glass log.” The purposed is to stabilize the fission products into a manageable form so it can be placed in dry storage or in a repository.  This process is called vitrification, and France has done some of it with their liquid wastes, and the Savannah River complex in South Carolina has a small plant experimenting with their wastes.  The plant being built by Bechtel at Hanford is about half built today, started in 2000, and over budget from $1.5 billion to more than $12b.  It may never go into operation because of the magnitude of technical and financial issues it faces.  This does not get rid of the high level wastes; it just makes turns the liquids into a stable form, which will have to be monitored and stored for tens of thousands of years.

Enter another interesting piece to the story…Reprocessing, as the Pu extraction process is also called, has been pushed by the nuclear industry as a way to deal with the High Level waste issue.  Pu can be used as a fuel in special “breeder” reactors, because under special controlled conditions, it can fission, releasing energy, and more neutrons, which can then be absorbed by U238 creating more Pu…essentially creating (breeding) more of its own fuel.  Though on paper this looks like a great idea, it has been proven technically, economically, and realistically unfeasible.  And it also produces radioactive fission products, which must be dealt with.  We abandoned our program in the late “80”s, with France, Japan, and the UK abandoning their breeder programs after spending countless billions of dollars, and are now faced with the huge task of cleaning up large volumes of highly radioactive liquids and sludges.  Reprocessing, recycling, whatever you want to call it, doesn’t solve the High Level waste problem; it just transforms one problem into a huge new problem.  It does not get rid of the waste.  We would still need dry cask storage, and/or a repository.  And it would require a whole new generation of unproven reactor technology, as well as a new “Hanford” technology to manage the front end and the back end of the fuel cycle.  Very expensive! Very dangerous!  Hell of a way to boil water!

For years, the industry has dreamed of a Plutonium economy.  I still hold on to the dream of a renewable Hydrogen economy.

Sunday, July 10, 2016

The Closure of the Diablo Canyon Nuclear Power Plant

A few weeks ago, PG&E announced that it would not pursue a license renewal for the 2200mw reactors at Diablo Canyon.  This is major landmark decision, driven by the potential seismic issues at the site, and the need for huge uneconomical upgrades to continue to run the plants beyond their 2024 expiration.  Several major policy points are highlighted in this decision.

First, nuclear power today is basically uneconomical, and way more expensive than the alternatives of natural gas, renewables, and efficiency.  This is true for new plant construction, as well as the continued operation of the aging plants built 30-40 years ago. Diablo has always been contentious…first in its fiasco construction cost overruns, then in its electricity pricing schemes during the 2000’s deregulation debacle, to its current expensive electricity…even though it is an old plant whose capital costs have been paid for over the years by ratepayers.  This is happening all over the US, as we begin to wean ourselves from the large economic, environmental, and social costs of centralized nuclear and coal power.

Second, the myth of utilities needing huge baseload power to counter the intermittency of renewables no longer stands.  PG&E CEO Tony Earley said “that as the company looked into California’s energy needs for the coming decades, it didn’t see a place for Diablo…Our analysis continues to show that instead of continuing to run all the time, there will parts of the year where Diablo will not be needed…At a plant like Diablo, with large fixed costs, if you effectively only run the plant half the time, you’ve doubled the cost.”  I have talked before about peak power demand, and how generating resources are allocated. Early use of solar met some of the need for “peaker” natural gas plants.  The tremendous deployment of renewables, and their enormous potential today offers the ability to use the most cost-effective and efficient energy resource to meet the demand.  Recently, in the Northwest, some wind power producers were paid (due to contracts written years ago) not to produce power during certain times, because demand was low, and large baseload power plants could not be turned on or off at will.  Renewables can be turned on or off whenever without serious economic issues because of their technology, and the fact that the fuel is free.  Some say that costly peakers will only be used in dire circumstances, since batteries can be recharged and hydrogen produced at will whenever excess electricity is available anytime of the day.

Third, PG&E acknowledges the dramatic and incredible changes that are coming to the “grid” and to the utilities themselves.  The biggest challenge obviously is the storage of excess electricity for use when needed.  California is actively pursuing and developing various options with great promise.  (I still think hydrogen/fuel cells will become the most realistic option.)  Ironically, back in the ‘80’s the only way Diablo could fit into California’s electricity system was with storage.  At night when the 2000MW of baseload was not needed, and the plant could not be turned off, the power was used to pump water uphill to a reservoir where it would be released the next day providing 1000MW of hydro power when it was needed (the Helms Project.)  That water is captured, and pumped back uphill the next evening.  Smaller-scale storage will allow for more flexibility in the new digital grid system, with various options being battery storage (commercial large scale as well as small residential,) pumped storage, mass /gravity systems, compressed air, and a whole lot of ingenious methods on the drawing boards.

Fourth, the whole electricity market is changing very rapidly.  More and more businesses and individuals are seeing the benefits of creating their own power, and using utilities for distribution, or just bypassing them altogether.  Google just overtook the US Department of Defense as the largest single user of electricity, and will soon become the largest single producer in the US, with more to come.  MGM Resorts found it cheaper to generate their own electricity rather than buying it from the utility, and that Nevada utility just lost its biggest customer.  As prices comes down due to better manufacturing, increased efficiency, and new financial marketing, the future looks very bright.  Add the fact that electricity demand is declining due to efficiency in all sectors…thus PG&E holds confidence that it can meet the challenges of the future for California. Remember, this is one of the largest utilities in the US, and other states and utilities will soon follow suit, because they need to evolve and adapt to the new technological grid and the shift from the old-school business model of supply and demand.

Fifth, another myth that we need nuclear to meet the challenge of reducing CO2 emissions no longer holds validity.  Even though the actual operation of a fission reactor does not produce CO2 because it is not burning fossil fuels, the entire fuel chain from creating the uranium fuel to decommissioning and waste disposal releases large amounts of all kinds of toxic and greenhouse emissions.  PG&E is confident that it can meet the demands of the State for its mandate of 50% renewables by 2030 with a subsequent decrease in emissions.

Sixth, PG&E glosses over the huge commitment to the decommissioning of Diablo, stating that the cost sometime down the road would be $3.8 billion.  I stand and say  “Nonsense!” “Big Hoax!”  In 1987 when we in Humboldt County fought PG&E in court on decommissioning costs, they estimated Diablo to cost $200m.  We prevailed with the judge acknowledging a price tag of $1B.  PG&E was appalled.  At the same time, the Humboldt Bay nuke was estimated at $95m.  That escalated to $380m in 2007 before work began; then to $500m a few years later, to the current estimate of over $1B.  I expect Diablo will cost in excess of $8B, and the actual work won’t begin in earnest for 20-30 years, with PG&E spending large sums of monies for SafeStor of the plant and the safeguarding of the spent fuel waste.  Meanwhile, ratepayers will continue to be charged a “tax” to go into the fund (currently at $2.8B) to pay all the bills, and future generations for years to come will continue to meet that debt, as well as the unknown costs of storing the spent fuel forever.  It’s interesting that EDF in France is starting to drool over the current $200B cost estimate for decommissioning its reactors...Areva, Bechtel, Babbcock & Wilcox, Westinghouse, at al are licking their chops for their future profits in the trillion dollar global bill.  Remember, these monies are non beneficial…no real benefit except for the jobs and profits…no useful product such as electricity, goods, or other products.  It’s taking out the garbage after an elaborate meal.  Sort of like the Cold War mentality, where we spent trillions of dollars producing something (nuclear weapons) we hoped we never would have to use!

The future closure of Diablo Canyon is indeed a battle long fought and hard won.  We are still trying to get it closed NOW before an earthquake or other incident creates an economic and environmental catastrophe.   Our dreams are slowly coming true as we always believed, where we can run parts of our society on clean, sustainable, renewable energy.  There are tremendous challenges ahead, both technical, and mainly political; but over time common sense prevails. We’ll see what happens in November!

A couple of good reads are: