No Amount Of Subsidies Will Ever Make A Wind/Solar Electricity System Economically Feasible

Manhattan Contrarian ^ | Francis Menton

[MtnClimber]

The COP 28 climate confab opened today in Dubai. Some 70,000 true believers in the energy transition are said to be gathering. And not one of them appears to be either willing or able to do the simple arithmetic that shows that this can’t possibly work.

So far, no country that has made a commitment to “net zero” has officially backed off. (Argentina may soon become the first.). Things proceed as if all that is needed is to build sufficient wind and solar generation facilities, until eventually you have enough of them to meet demand. But that’s not how this works. The absurdity becomes more obvious every day. Can somebody please tell the poor people making fools of themselves in Dubai?

Let’s consider the latest from Germany. According to Statista here, Germany consumed 511.59 TWh of electricity in 2021 (latest year given, although the numbers have recently changed very little from year to year). Divide by 8760 (number of hours in a year) and you learn that Germany’s average usage of electricity is 58.3 GW. So, can you just build 58.3 GW of wind and solar generators to supply Germany with electricity?

Absolutely not. In fact, Germany already has way more wind and solar electricity generation capacity than the 58.3 GW, but can’t come anywhere near getting all its electricity from those sources. As of June 2023 Germany had 59.3 GW of generation capacity from wind turbines alone, and (as of end 2022) another 67.4 GW of generation capacity from solar panels. The total of the two is 126.7 GW — which would supply more than double Germany’s usage at noon on a sunny and breezy June 21. But, according to Clean Energy Wire here, through the first three quarters of 2023, the percent of its electricity that Germany got from wind and solar was only 52%. Capacity seemingly sufficient to supply double the usage in fact only supplies half. That’s because the supply does not come at the same time as the demand, and the wind/solar generation system provides no mechanism to shift the supply to a time to meet the demand.

And why doesn’t Germany just double the amount of its wind/solar generation, so that those sources would go from supplying 52% of usage to 100%. Because it doesn’t work that way. If they double the wind and solar generation, then on the sunny/breezy June 21 mid-day they will now have over 250 GW of electricity generation — more than 4 times what they need — so they will have to discard or give away the rest. But on a calm night in January, they will still have nothing and need full backup from some other source. Multiplying the wind/solar generation capacity by 10 or even 100 (referred to as “overbuilding”) will increase the costs of the system exponentially, but will never be enough to keep the lights on all the time. Or you can try energy storage to save up the surpluses to cover the deficits, but that also multiplies the costs of the system exponentially. For more than you will ever want to know about energy storage and its costs, read my December 2022 energy storage report, “The Energy Storage Conundrum.”

Renewable energy promoters and governments committed to “net zero” are engaged in a gigantic exercise of self-deception. They have come up with a thoroughly misleading metric to compare the costs of generating electricity from various sources which they call “Levelized Cost of Electricity.” Reports that claim to calculate these LCOEs are published by various organizations, including notably the investment bank Lazard and the International Renewable Energy Agency or IRENA. Here is IRENA’s 2022 Report covering supposed renewable energy costs for 2021, title “Renewable Power Generation Costs in 2021.” Key quote from page 17:

In 2021, the global weighted average LCOE of new utility-scale solar PV and hydropower was 11% lower than the cheapest new fossil fuel-fired power generation option, whilst that of onshore wind was 39% lower.

Wow, solar is 11% cheaper than any fossil fuel alternative, and onshore wind 39% cheaper. Why would any dope ever look to fossil fuels again?

And here’s their key chart:

Incredible! Solar is under 5 cents per kWh, and onshore wind is even lower at 3.3 cents per kWh. And how much is in those numbers to account for the cost of either overbuilding or energy storage in order to make a system that works 24/7/365 without fossil fuel backup? The answer is, exactly nothing.

The fact is that building a wind/solar/storage electricity system without fossil fuel backup does not provide cheaper electricity than a predominantly fossil fuel system, but more expensive electricity. And the additional expense is not some small amount like 10 or 20 or 30 percent. It’s more like a multiple of 10 or 20. Nobody knows exactly how much, because there does not exist anywhere in the world a working demonstration project from which costs can be benchmarked and extrapolated. As you start to eliminate the fossil fuel backup from the system, far and away the predominant costs become the energy storage and/or overbuilding. The costs of the wind turbines and solar panels themselves become relatively insignificant. As noted, Germany has gotten to about 50% of its electricity generation from wind and solar, with so far about a 2 times overbuild of capacity, and almost no storage. With the next round of overbuild of capacity, should they do it, they will be lucky to get to 60% of electricity from renewables; and each successive round of overbuild adds less useful electricity and more that must be discarded. Meanwhile, storage is ruinously expensive in quantities that are meaningful to keeping the lights on year round.

In the real world of investment decisions, the costs are becoming increasingly obvious. Greg Ip has a piece in today’s Wall Street Journal, headline “Why No One Wants to Pay for the Green Transition.” Excerpt:

Investors and consumers balk at costs of replacing fossil fuels with renewable energy, highlighting painful economics of climate mitigation. . . . In the past few years, Washington and Wall Street started fantasizing that the transition to net-zero carbon emissions could be an economic bonanza. . . . This year the fantasy ended. . . . [T]he economics of getting to net zero remain, fundamentally, dismal: Someone has to pay for it, and shareholders and consumers decided this year it wouldn’t be them.

Of course consumers are never voluntarily going to pay $2 for energy that can be had for $1. Nor are investors ever going to invest to provide consumers the $2 energy when the consumers can go elsewhere for $1. As it becomes obvious that the whole LCOE “wind and solar are cheaper” thing is a transparent lie, all private money will exit the energy transition. The only possible way to get this wind/solar system built is government subsidies. Gigantic, massive government subsidies on a scale far greater than anything ever seen in human history. It’s a very safe bet that it will never happen.

[MtnClimber]

You don’t need so much storage capacity if you have far fewer people.

[Jonty30]

It’s about the electrons. You can only store so many electrons together before it becomes unfeasible. It’s a physics problem.

[apoliticalone]

But the subsidies make it very economically feasible and profitable to the elitist few while pillaging the many. This is just like wars and many other disruptive events where the few purposely create chaos so they can siphon off the cash that should instead be used to improve society for those who pay. Evil is covered up by media, politicians and other deceptionists.

[Sacajaweau]

The point really is....nothing we do will change the "climate". This whole farce is disrupting our economy and others around the world. It's also making each and everyone of "pawns" of the government....from straws to stoves...it should be our choice not the government mandates.

Mother nature rules.

[EandH Dad]

It’s not about the money, it’s about the power. The difference is there is a point where power can make money meaningless, there is no point where money can make power meaningless.

[Paul46360]

they all flew there on magic carpets

[Tell It Right]

Making the grid dependent on wind and solar is extremely dumb.

Solar works only in a decentralized fashion, and even then only in a very few use cases (if we're talking about working good enough to go off grid). Solar can be good, though, if we're talking about making a home need the grid less -- but even then many of the variables have to be right for your situation for it to be worth the cost.

We're all better off if we educate the masses that the political class made up a warmageddon cult religion that's not based on science. The Modern Warm Period is no different from the Medieval Warm Period or the Roman Warm Period (time of Christ) or the Minoan Warm Period (time of Moses and Era of Judges). Thus there's no reason to remove of freedoms and degrade our society to 3rd world status of global warming.

[E. Pluribus Unum]

https://www.law.utoronto.ca/blog/faculty/wind-power-complete-disaster

Wind Power is a Complete Disaster

Michael Trebilcock

Tuesday, April 14, 2009

This commentary was first published in the Financial Post on April 9, 2009.

There is no evidence that industrial wind power is likely to have a significant impact on carbon emissions. The European experience is instructive. Denmark, the world's most wind-intensive nation, with more than 6,000 turbines generating 19% of its electricity, has yet to close a single fossil-fuel plant. It requires 50% more coal-generated electricity to cover wind power's unpredictability, and pollution and carbon dioxide emissions have risen (by 36% in 2006 alone).

Flemming Nissen, the head of development at West Danish generating company ELSAM (one of Denmark's largest energy utilities) tells us that "wind turbines do not reduce carbon dioxide emissions." The German experience is no different. Der Spiegel reports that "Germany's CO2 emissions haven't been reduced by even a single gram," and additional coal-and gas-fired plants have been constructed to ensure reliable delivery.

Indeed, recent academic research shows that wind power may actually increase greenhouse gas emissions in some cases, depending on the carbon-intensity of back-up generation required because of its intermittent character. On the negative side of the environmental ledger are adverse impacts of industrial wind turbines on birdlife and other forms of wildlife, farm animals, wetlands and viewsheds.

Industrial wind power is not a viable economic alternative to other energy conservation options. Again, the Danish experience is instructive. Its electricity generation costs are the highest in Europe (15¢/kwh compared to Ontario's current rate of about 6¢). Niels Gram of the Danish Federation of Industries says, "windmills are a mistake and economically make no sense." Aase Madsen , the Chair of Energy Policy in the Danish Parliament, calls it "a terribly expensive disaster."

The U. S. Energy Information Administration reported in 2008, on a dollar per MWh basis, the U. S. government subsidizes wind at $23.34 -- compared to reliable energy sources: natural gas at 25¢; coal at 44¢; hydro at 67¢; and nuclear at $1.59, leading to what some U. S. commentators call "a huge corporate welfare feeding frenzy." The Wall Street Journal advises that "wind generation is the prime example of what can go wrong when the government decides to pick winners."

The Economist magazine notes in a recent editorial, "Wasting Money on Climate Change," that each tonne of emissions avoided due to subsidies to renewable energy such as wind power would cost somewhere between $69 and $137, whereas under a cap-and-trade scheme the price would be less than $15.

Either a carbon tax or a cap-and-trade system creates incentives for consumers and producers on a myriad of margins to reduce energy use and emissions that, as these numbers show, completely overwhelm subsidies to renewables in terms of cost effectiveness.

The Ontario Power Authority advises that wind producers will be paid 13.5¢/ kwh (more than twice what consumers are currently paying), even without accounting for the additional costs of interconnection, transmission and backup generation. As the European experience confirms, this will inevitably lead to a dramatic increase in electricity costs with consequent detrimental effects on business and employment. From this perspective, the government's promise of 55,000 new jobs is a cruel delusion.

A recent detailed analysis (focusing mainly on Spain) finds that for every job created by state-funded support of renewables, particularly wind energy, 2.2 jobs are lost. Each wind industry job created cost almost $2-million in subsidies. Why will the Ontario experience be different?

In debates over climate change, and in particular subsidies to renewable energy, there are two kinds of green. First there are some environmental greens who view the problem as so urgent that all measures that may have some impact on greenhouse gas emissions, whatever their cost or their impact on the economy and employment, should be undertaken immediately.

Then there are the fiscal greens, who, being cool to carbon taxes and cap-and-trade systems that make polluters pay, favour massive public subsidies to themselves for renewable energy projects, whatever their relative impact on greenhouse gas emissions. These two groups are motivated by different kinds of green. The only point of convergence between them is their support for massive subsidies to renewable energy (such as wind turbines).

This unholy alliance of these two kinds of greens (doomsdayers and rent seekers) makes for very effective, if opportunistic, politics (as reflected in the Ontario government's Green Energy Act), just as it makes for lousy public policy: Politicians attempt to pick winners at our expense in a fast-moving technological landscape, instead of creating a socially efficient set of incentives to which we can all respond.

These comments were excerpted from a submission on April 8, 2009 to the Ontario government's legislative committee On Bill 150.

 

[AZJeep]

The building and installation of wind turbines and solar cells consumes so much energy, that they barely return it by the time they broke. Very little net energy is gained.
But lots of hazardous waste is generated.

[The FIGHTIN Illini]

Thanks, for future reference(arguments)

[iamgalt]

The whole thing is just so ridiculous. There’s enough petroleum based fuel to last a thousand years

[MMusson]

Solar is a 6 hour solution to a 24 hour problem.

Solar panels produce at rated levels from 10AM to 4PM. So you need 18 hours worth of batteries and 3 other solar farms to charge them.

[OHPatriot]

The COP 28 climate confab opened today in Dubai. Some 70,000 true believers in the energy transition are said to be gathering. This group represents a “Carbon Footprint” that is in desperate need of REDUCTION!!!!

Just think, ONE small Nuke ..............

[VTenigma]

Duh

[joshua c]

taxpayer subsidies do not make anything economically feasible

it only changes who pays for it

wind/solar would still be economically infeasible even if the taxpayer paid the full freight

[Chad C. Mulligan]

Let me recommend again Meredith Angwin's excellent book, Shorting the Grid. Ms. Angwin is a long-term insider in the power industry, and knows what she's writing about.

[unlearner]

“As noted, Germany has gotten to about 50% of its electricity generation from wind and solar, with so far about a 2 times overbuild of capacity, and almost no storage. With the next round of overbuild of capacity, should they do it, they will be lucky to get to 60% of electricity from renewables; and each successive round of overbuild adds less useful electricity and more that must be discarded. Meanwhile, storage is ruinously expensive in quantities that are meaningful to keeping the lights on year round.”

HVDC current is about 97% efficient per 1000 km (620 mile) journey.

I did some back-of-napkin math. This means you can load balance around the globe at about 56% efficiency.

It would require some infrastructure investment, plus a global grid would have some geo-political vulnerabilities. But the math contradicts the premise of this article.

Plus, storage costs will likely come down.

Further, to me, the ability for greater independence justifies spending more on battery backup or other storage.

There will also be economies of scale that kick in at some point. Perhaps everyone having battery backup is not cost-efficient, but storing energy in heated molten salt may be when the projects are big enough.

[vpintheak]

Incredibly well laid out article and references. Kudos to the author!

[LS]

Francis Menton is soooo good on these stats.