I had a wonderful 4th of July reflecting and discussing how fortunate we are to live in this great nation of America, in spite of all its ongoing problems, and its more recent polarization. This past week has been a major turning pointing for solar energy in California, and is likely to set precedent for the rest of the country.
The Southwest suffered through an incredible heat wave, which now appears to be subsiding. Energy pundits were predicting disaster in the state; the two reactors at San Onofre were gone, one unit at Diablo Canyon developed a weld crack and was shut down, and low precipitation in the winter diminished available hydropower. The loss of some 4000MW of electricity would plunge the state into blackouts, brownouts…industry, people would suffer. It didn’t happen! The availability, pricing, and dispatch of electricity is a very complex process, but here are a few things to consider.
The Cal ISO is responsible for keeping the electrons flowing in the wires. The System Status page on their website is crucial to understanding what is going on. http://www.caiso.com/SystemStatus.html
shows electricity use for the entire day. At night, use is low, hitting a low of 24,000MW around 4am. The peak usually occurs around 4-5pm, and is normally around 34,000MW. When it is really hot, for the few weeks out of the year, the peak can reach 44,000MW, mainly due to air conditioning, as it did earlier in the week. This demand has to be met, but here are a few key points in this equation. There was a 20% buffer…available electricity, which can be called upon when needed. In the case last Tuesday, the amount of electricity available at peak was 55,000MW, 11,000 more than what was needed or used. These small generators are called “peakers” and are usually small jet turbines that can be turned on/off in a matter of minutes. They are expensive to run because they only operate for a short period of time when fuel costs are at their highest. http://www.lasvegassun.com/news/2013/jun/29/peaking-units/#axzz2XiYZW5H3
The main point is that we have a lot of generating capacity that is unused during most of a 24 hour period and during most of the year…all there to meet the peak demand when it is hot because the sun is shinning.
Scroll down the page, and look at the renewables contribution to the demand. The state has about 2000MW from utility grade solar, and an estimated 1500MW from small-scale rooftop systems. This made up for the loss of nuclear electricity, and because the fuel is free, was actually cheaper than running the natural gas peakers.
Solar is too expensive! How often have we heard that? How do we quantify the economics of solar…nuclear…any kind of energy. That is a great mystery, but the basic economic principles account for Capital investment (design and construction costs), O & M (cost of fuel, operation, and maintenance), End costs (dismantlement, waste disposal, etc), and Profit (utilities are guaranteed a profit after they have paid taxes, insurance, depreciation, public programs, advertising, etc, etc.). Solar has very low O&M costs (the fuel is free), minimal End costs, but has had high Capital costs. All that is rapidly changing. The recent rash of bankruptcies in the solar manufacturing industry worldwide has been due to dramatic reduction in the cost of the final product…the PV cell. Major blame can be placed on China for “subsidizing” their solar industry, and now dominating the global solar market.
Here are some quotes from recent reading:“The EIA has historically overestimated the cost of renewables, and underestimated the cost of conventional fuels. The new 50-MW Macho Springs solar plant under construction by First Solar in New Mexico will deliver power for $50.79/MWh (that’s 5 cents/kwh) under its Power Purchase Agreement (PPA), and other US solar projects have come in this year in the range of $70 to $90/MWh.”
“The price of power in the Mid-Columbia was $18.85 per megawatt hour last year (mainly due to cheap hydro), but Energy Northwest’s nuclear power cost was about $47.30 per megawatt hour, said Robert McCullough, of McCullough Research.”“EIA suggests a minimum cost for advanced nuclear of $104.40, an average of $108.40, and a maximum of $115.30/MWh.” PG&E’s Diablo Canyon nuclear electricity was 14 cents/kwh back in 2000 during deregulation…that ultimately resulted in their bankruptcy.
“Three or four years ago, the solar industry was targeting one dollar per watt costs in 2013; today we are at 50 cents per watt.”
“The cost of photovoltaic solar panels is expected to drop to 36 cents per watt by 2017”
Today, solar is almost cost-competitive with grid-tied electricity, not only here in the US, but in Germany, Spain, and Italy, and soon in most parts of the world. The key to its deployment is POLITICS and not economics.