LARGE-SCALE SOLAR PLANTS REQUIRE LARGE-SCALE BATTERY SYSTEMS

PV Solar Output Variability During variable Cloudy Weather

 

Clouds are the main reason PV solar generation experiences intermittency (excluding the normal night-time disappearance).

PV solar generation can rapidly decrease by 60% within seconds, due to a cloud passing over the solar panels causing a reduction in solar insolation.

The time taken for the cloud to pass is dependent upon cloud height, sun elevation and wind speed. These factors need to be considered regarding solar power production forecasting and integrating the variable output into the grid.

The graph shows PV output profiles for ZIP codes in California

 

 

Reaction Times

 

Additional considerations are reaction times of other generators on the grid. Batteries have quick reaction times, i.e., can quickly charge and discharge electricity. Any rapid solar output decreases (downward spikes) due to clouds are quickly offset.

 

Gas turbines, the workhorses that have historically provided peaking, filling in and balancing services to the grid, have much slower reaction times. If the downward spikes were only a few MW/sec, gas turbines would be adequate to maintain grid frequency within the narrow ranges specified by the grid operator.

 

However, if the downward spikes were many MW/sec, such as with the below described, very large capacity, FP&L solar systems, gas turbines would be unsuitable (could not keep up), but batteries could.

 

Large-Scale Solar Plants Require Large-Scale Battery Systems

 

The upward and downward spikes of wind output are much slower, MW/min, instead of MW/sec. Gas turbines (and hydro plants) can easily adjust their outputs to offset any wind up/down spikes.

 

Till now, the solar downward spikes have been minor in most geographical areas, but as installed solar capacities increase for a given area, more and more of expensive, grid-scale, battery capacity would be needed to prevent frequently roiling the grid during variable cloudy weather.

 

NOTE: This has nothing to do with the daily duck curves, which have become very evident in southern Germany and southern California, and present an additional disturbance to the grid to be managed by grid operators, mostly with existing gas turbine generators and hydro plants.

 

Large-scale solar plants requiring large-scale battery systems is bad news for the future economics of solar, significantly increased solar build-outs could not happen (they would disturb the grid too much) without also building out expensive grid-scale battery systems. That is the main reason, southern Germany and southern California, each with large capacities of solar, have been installing battery systems during the past 5 years.

 

If batteries are the only source of the necessary short reaction times, then batteries are required. The only appropriate policy would be to require owners of any larger-scale solar plants to provide, at his own expense, a suitable battery system between the solar system and the grid.

 

Utility energy systems engineers in southern Germany, etc., have been well aware of all this for at least 10 years, but usually were forbidden to publicly talk about it, as that would have interfered with various pro-RE mantras, such as “so many households served”, or other such nonsense, as promulgated in PR releases during the past 20 years.

 

Unfortunately, the pro-RE mantras, i.e., slogans to obfuscate a gross deception, have become ingrained into the public mind. I say unfortunately, because they aim to hide the truth from reality.

 

Florida Power & Light Reactions to Solar Output Downward Spikes

 

FP&L is not putting in $360 million of battery systems, because it wants to be “seen as green”, or out of the goodness of its heart, as the pro-RE mantras might proclaim.

 

FP&L is concerned with providing high-quality electricity service at high reliability, 24/7/365, year after year, i.e., 99.98% or better.

 

FP&L is worried a series of solar downward spikes of about 100 MW, each lasting about 5 seconds, i.e., 20 MW/sec, would occur when dark, low-hanging clouds (a common occurrence in Florida) pass over its large-capacity solar plants.

FP&L is worried the downward spikes would excessively destabilize its grids.

 

FP&L had no choice, but to put in these large-scale battery systems to offset the solar downward spikes, before feeding the solar output into the grid.

Direct and Indirect Subsidies and Favorable Electric Rate Increases

 

FP&L receives very high levels of direct and indirect federal and state subsidies for its solar plants and for its batteries to make such expensive RE investment decisions much easier (and more obscure to lay people, including almost all legislators, etc.).

 

FP&L likely would obtain additional revenue from suitable household electric rate increases, as agreed to (often behind closed doors) by the Florida Public Utilities Commission, which also wants to be “seen as green”.

 

High RE MW/Capita Means High Household Electric Rates: Politicians add extra taxes, fees and surcharges on the electric bills of poorly organized households, in the name of mantras, such as saving the world, fighting global warming, etc.

The below graph shows Household Electric Rates, c/kWh, all charges included, versus Installed RE MW/capita).

High RE MW/capita led to high household electric rates for the households of Joe and Jane Worker in Germany and Denmark. 

 

Additional Services by Battery Systems

 

1) Batteries can supplement the minimal solar output during early morning hours and during late afternoon/early evening hours, which usually have peak demands with higher wholesale electric rates.

 

That means batteries need to charge from the grid during late evening/early AM hours, when wholesale electric rates are lower, a.k.a., arbitrage.

 

This also would provide more load for the gas turbine plants during late evening/early AM hours; higher turbine loads often result in increased plant efficiencies.

 

2) While offsetting the above-mentioned solar downward spikes, the batteries could be used, at the same time, for response to frequency deviations on the grid, the so-called FCAS market, 24/7/365, a service, which would provide a part of its day-to-day income.

 

The battery spends a significant portion of its effort on frequency support of the grid, i.e., it performs minor charging/discharging, 24/7/365.

 

FLORIDA POWER & LIGHT FUTURE PLANT EXPANSION

 

FP&L is planning to install battery plants, solar plants and combined-cycle, gas-turbine plants in the near future.

The capacity of the battery plant will be 409 MW/900 MWh, delivered as AC should be added if known, i.e., 900/129 = 7 times larger than the Hornsdale Power Reserve, HPR, in Australia. See URLs

https://wattsupwiththat.com/2019/04/05/grid-scale-battery-nonsense-...

http://www.windtaskforce.org/profiles/blogs/the-hornsdale-power-res...

 

In 2020, the turnkey capital cost of the batteries would be about 900,000 kWh x $450/kWh = $360 million, to be amortized over 15 years.

In 2020, the turnkey cost of the new CCGT plants would be about 1778 MW x $1.25 million/MW = $2223 million, to be amortized over 35 to 40 years.

In 2020, the turnkey cost of the new solar plants would be about 74.5 MW x 2 x $2.5 million/MW = $372.5 million, to be amortized over 25 years.

 

"It will have a capacity of 409 MW and be able to produce 900 MWh of energy from FPL’s adjacent Manatee solar farm and another (of equal size) to be built nearby. It will provide clean, cost effective electricity."

This is a typical statement made by PR departments. Such statements cause energy systems engineers to cringe.

1) The battery would not produce anything. It only charges, stores and discharges.

 

2) After some aging, any electricity passing through the batteries would have about a 20% loss, on a high voltage AC to high voltage AC basis, i.e., it consumes a lot of electricity.

 

3) The Parish County existing, 50y-old, inefficient plants, 1618 MW, would be demolished. On the cleared, 50-acre site, would be the new batteries; 50 acres of batteries!!

 

4) New, 55%-efficient, gas-fired CCGT plants, 1778 MW, would be built at Lake Okeechobee.

 

They would be operated in base-loaded mode.  

Their output would more than replace that of the demolished plants.  

 

5) The capacities of the existing Manatee solar plant, and the nearby one, now under construction, would be 74.5 MW each. The required plant area for both solar plants would be about 1043 acres, at 7 acre/MW. 

 

6) Production of both solar plants would be about 74.5 MW x 2 x 8766 h/y x 0.19, capacity factor = 248,165 MWh/y, or 680 MWh/d.

 

- The average output of the highest months, April and May, would be about 1.4 times the lowest month in winter, December.

- That ratio is about 4/1 in NE, about 6/1 in Germany.

- That means solar could not be relied upon during a 5 to 7 day wind/solar lull during an NE winter, because simultaneously the panels may be covered with snow and ice.

- The production would decrease at a compounded rate of about 0.5%/y, due to panel aging. 

https://decisiondata.org/solar-by-state/florida/

 

7) The output of the solar plants would be minimal at 8 AM, maximal at noon-time, and minimal about 5 PM.

 

8) During midday, electricity would be fed into the battery at the allowed battery feed in rate, and no higher. 

 

9) During evening, electricity would be discharged from the battery at the allowed discharge rate, and no higher.

10) The battery capacity is 409 MW/900 MWh; delivered as AC should be added, if known. In the real world, the battery would never be discharged to zero, or charged to the maximum, to avoid damage, which likely would shorten its life.

 

Battery Charge/Discharge Loss for Performing Arbitrage

 

PV as Electricity Source to Batteries

 

Assuming the cumulative electricity from the PV system, mostly during midday hours, would be 586 MWh/d, as DC, and

Assuming the additional charge in the battery would be 563 MWh/d as DC, then

About 519 MWh/d, as high voltage AC, could be fed to the grid during late afternoon/early evening hours, for a loss of 7.8%. See table 1.

 

Grid as Electricity Source to Batteries

 

Assuming the cumulative electricity from the grid during late night/early AM hours would be 623 MWh/d, as high voltage AC, and

Assuming the additional charge in the battery would be 563 MWh/d, as DC, then

About 519 MWh/d, as high voltage AC, would be fed to the grid during late afternoon/early evening hours, for a loss of 16.73%. See table 1

 

Economics of Arbitrage, if Grid is the Source

 

FP&L would have to draw from the grid 623 MWh/d, costing about $24934/d, at $35/MWh (nighttime rate).

FP&L would avoid buying 519 MWh/d, costing about 36335/d, at $70/MWh (peak rate), for a gain of $11,401/d. See table 1

 

The question is would this gain offset the daily owning and operating cost of the battery? A very detailed spreadsheet analysis would be required. Only number people, such as accountants and engineers, would be interested to peruse the numbers.

 

However, here is a simplified method of economic analysis, which is easy to understand. It is commonly used for preliminary economic analysis.

 

- Assuming no direct and indirect subsidies, and 10% cost of money, amortizing the above $360 million battery capital cost (at the current price of about $400/kWh), over 15 years, would require payments $46.423 million/y, or $127,186/d.

 

- Assuming no direct and indirect subsidies, and zero cost of money, just paying back the above $360 million over 15 years would require $65,763/d.

 

- Assuming no direct and indirect subsidies, and zero cost of money, and the battery capital cost were $90 million (at a Holy Grail future price of $100/kWh), just paying back the $90 million over 15 years, would require $16,438/d.

 

- If direct subsidies, such as the federal investment tax credit, FTC, and state investment tax credit, STC, (which act as up front cash gifts by taxpayers to owners), would reduce the capital cost by a total of 30%, and if zero cost of money, just paying back the 90 x 0.7 = $63 million over 15 years would require $11,507/d.

 

The $11,507/d cost is about the same as the above energy cost gain of $11,401/d.

 

However, there are other costs which were ignored, such as:

 

- Battery system aging, which increases the operating costs

- Battery system maintenance and operation

- HVAC of the batteries; they must be kept near 70F for best performance and long life

Economics of Arbitrage Worse, if Solar is Source 

The same simplified method of economic analysis is used.

 

If a direct subsidy, such as federal investment tax credit, FTC, and state investment tax credit, STC (which act as up front cash gifts from taxpayers to owners), reduced the remaining capital cost of the solar plants by a total of 30%, and if zero cost of money, just paying back the 372.5 x 0.7 = $260.75 million over 25 years would require $40,822/d.

The daily solar production would be the above-stated 680 MWh/d.

The minimum estimate of the electricity cost would be $40,822/680 MWh = 4.20 c/kWh.

The minimum cost would be less, if indirect subsidies were added.

 

However, there are other costs which were ignored, such as:

 

- Solar panel aging at 0.5%/y, which reduces production each year

- Battery system aging, which increases the operating costs

- Battery system maintenance and operation

- HVAC of the batteries; they must be kept near 70F for best performance and long life

- Bank loan interest

- Return on investment

- Battery DC to AC loss, 7.8%. See table 1

 

It is clear from the above two examples, arbitrage would be far from profitable.

 

That means, there will need to be substantial revenues from grid frequency regulation services to make this project profitable.

 

Table 1/Electricity source		PV	Grid
Electricity from source, as high voltage AC			623
High voltage to low voltage efficiency			0.98
Electricity from source, as low voltage AC			611
AC to DC conversion			0.96
.
Electricity from source, as DC	MWh/d	586	586
Charging efficiency		0.96	0.96
Electricity from source into battery, as DC	MWh/d	563	563
Discharging efficiency		0.96	0.96
Electricity from battery, as DC	MWh/d	540	540
DC to low voltage AC efficiency		0.98	0.98
Electricity from battery, as low voltage AC	MWh/d	530	530
Low voltage to high voltage efficiency		0.98	0.98
Electricity to grid, as high voltage AC	MWh/d	519	519
Loss	%	7.80	16.73

 

Comparison of FP&L Old and New Gas Plants

The new plants would produce 46.5% more electricity per year, at a 6.6% increase in gas cost, and 6.6% increase in CO2.

 

Because of the use of abundant domestic, low-cost, low-CO2, clean-burning, natural gas, FP&L would not need to have increased electric rates, because it would still make a good profit with existing rates, a major plus for the Florida economy.

 

The additional steady, 24/7/365, low-CO2 electricity could be used for future heat pumps and electric vehicles, which would decrease space heating/cooling costs and transportation costs for the households and businesses, and decrease CO2.

 

The major components of the electricity cost/kWh are:

 

- Amortizing the turnkey capital cost

- Natural gas,

- 24/7/365 maintenance and operation. See table 2.

 

Table 2/Comparison of Old and New Plants		Old	New	% Change
Capacity	MW	1618	1778	9.89
Period	h/y	8766	8766
Capacity factor		0.60	0.80	33.33
Production	MWh/y	8510033	12468758	46.52
Btu/kWh		3412	3412
Efficiency		0.40	0.55	37.50
Btu/kWh		8530	6204	-27.27
Gas consumption	million Btu/y	72590580	77351643	6.56
Gas cost	$/million Btu	3.00	3.00
Gas cost	$million	217.77	232.05	6.56
Electricity cost, gas only	c/kWh	2.559	1.861	-27.27
.
Capital cost	$million		2223
Amortizing at 10%/y for 40 y	$million/y		226.518
Amortizing, capital only	c/kWh		1.817
Electricity cost, amort. + gas	c/kWh		3.678
.
CO2 emissions
Combustion only	lb/million Btu	117	117
Combustion only	million metric ton/y	3.85	4.11	6.56
Combustion only	g/kWh	453	329	-27.27

APPENDIX 1

WIND AND SOLAR SUBSIDIES PROVIDE A BONANZA FOR WALL STREET

This URL shows wind and solar prices per kWh would be at least 45% to 55% higher without subsidies, and they would be even higher, if the costs of other items were properly allocated to the owners of wind and solar projects, instead of shifted to others. See below section High Levels of Wind and Solar Require Energy Storage.

http://www.windtaskforce.org/profiles/blogs/economics-of-tesla-powe...

 

This URL shows about 2/3 of the financial value of a wind project is due to direct and indirect subsidies, and the other 1/3 is due to electricity sales.

http://johnrsweet.com/Personal/Wind/PDF/Schleede-BigMoney-20050414.pdf

 

An owner of a wind and/or solar project, looking to shelter taxable income from other businesses, is allowed to depreciate in 6 years almost the entire cost of a wind and solar project under the IRS scheme called Modified Accelerated Cost Recovery System, MARCS; the normal period for other forms of utility depreciation is about 20 years

 

Then, with help of Wall Street financial wizardry from financial tax shelter advisers, such as BNEF*, JPMorgan, etc., the owner sells the project to a new owner who is allowed to depreciate almost his entire cost all over again.

Loss of Federal and State Tax Revenues: The IRS estimated the loss of tax revenues to the federal government for the 5y period of 2017 - 2021. See “Energy” heading in URL

The next report would be for the 2018 - 2022 period

https://www.jct.gov/publications.html?func=select&id=5

 

The indirect largesse, mostly for wind and solar plants^ that produce expensive, variable/intermittent electricity, does not show up in electric rates. It likely is offset by taxes and added to the federal debt.

 

* BNEF is Bloomberg New Energy Finance, owned by the pro-RE former Mayor Bloomberg of New York, which provides financial services to the wealthy of the world, including providing them with tax avoidance schemes.

 

https://www.nrel.gov/docs/fy17osti/68227.pdf

https://www.greentechmedia.com/articles/read/tax-equity-investors-b...

 

Warren Buffett Quote: "I will do anything that is basically covered by the law to reduce Berkshire's tax rate," Buffet told an audience in Omaha, Nebraska recently. "For example, on wind energy, we get a tax credit if we build a lot of wind farms. That's the only reason to build them. They don't make sense without the tax credit." 

https://www.usnews.com/opinion/blogs/nancy-pfotenhauer/2014/05/12/e...