U.S. Offshore Wind Plans Are Utterly Collapsing

Comment

Comment by Willem Post on October 1, 2023 at 4:15pm

BIDEN 30,000 MW OF OFFSHORE WIND BY 2030; AN EXPENSIVE FANTASY  

 

The Biden administration announced on October 13, 2021, it will subsidize the development of up to seven offshore wind systems (never call them farms) on the US East and West coasts, and in the Gulf of Mexico; a total of about 30,000 MW of offshore wind by 2030.

 

This is part of the “Inflation Reduction Act”, which CBO estimated at $391 billion, but Goldman Sachs estimated at $1.2 trillion, due to Biden’s handlers “liberally interpreting” the various open-ended measures. 

This deficit spending will be added to the national debt, which would increase inflation. See URL for explanation.

https://www.windtaskforce.org/profiles/blogs/biden-s-green-energy-policy-may-end-in-tears-1

 

High Prices of Goods and Services: Biden's offshore wind systems would have an adverse, long-term impact on US electricity wholesale prices, and the prices of all other goods and services, because their expensive electricity would permeate into all economic activities.

 

High Visibility: The wind turbines would be at least 800-ft-tall, which would need to be located at least 30 miles from shores, to ensure minimal disturbance from night-time strobe lights.

 

Damage to Fisheries, Whales and other Fauna: Any commercial fishing areas would be significantly impacted by below-water infrastructures and cables. The low-frequency noise (less than 20 cycles per second, aka infrasound) of the wind turbines would adversely affect marine life, including whales, and productivity of fishing areas.

https://www.windtaskforce.org/profiles/blogs/feds-finally-admits-offshore-wind-can-kill-whales

 

Offshore Wind Electricity Production and Cost

 

Electricity production about 30,000 MW x 8766 h/y x 0.40, lifetime-average capacity factor = 105,192,000 MWh, or 105.2 TWh. The production would be about 100 x 105.2/4000 = 2.63% of the annual electricity loaded onto US grids.

 

Electricity Cost: Assume a $55 million, 10 MW project consists of foundations, wind turbines, cabling to shore, and installation at $5,500/kW.

 

- Production 10 MW x 8766 h/y x 0.40, CF = 35,064,000 kWh/y

- Amortizing bank loan for 50% of the project at 6.5%/y for 20 years, 7.017 c/kWh.

- Paying Owner of 50% of the project at 10%/y for 20 years, 9.082 c/kWh

- Offshore O&M, about 30 miles out to sea, 8 c/kWh.

- All other items, 4 c/kWh 

- Total cost 7.017 + 8.468 + 8 + 4 = 27.961 c/kWh

- Less 50% subsidies (tax credits, 5-year depreciation, interest deduction on borrowed funds) 13.981 c/kWh

- Owner sells to utility at 13.981 c/kWh

 

Not included:

- Cost of onshore grid expansion/augmentation, about 2 c/kWh

- Cost of curtailment/counteracting/balancing, 24/7/365, about 2 c/kWh

- Cost of decommissioning, i.e., disassembly at sea, reprocessing and storing at hazardous waste sites

 

Floating offshore wind

 

Electricity Cost: Assume a $75 million, 10 MW project consists of foundations, wind turbines, cabling to shore, and installation at $7,500/kW.

 

- Production 10 MW x 8766 h/y x 0.40, CF = 35,064,000 kWh/y

- Amortizing bank loan for 50% of the project at 6.5%/y for 20 years, 9.568 c/kWh.

- Paying Owner of 50% of the project at 10%/y for 20 years, 12.385 c/kWh

- Offshore O&M, about 30 miles out to sea, 8 c/kWh.

- All other items, 4 c/kWh 

- Total cost 9.568 + 11.547 + 8 + 4 = 33.953 c/kWh

- Less 50% subsidies (tax credits, 5-year depreciation, interest deduction on borrowed funds) 16.997 c/kWh

- Owner sells to utility at 16.997 c/kWh

 

NOTE: If li-ion battery systems were contemplated, they would add 20 to 40 c/kWh to the cost of any electricity passing through them, during their about 15-y useful service lives! See Part 1 of URL
https://www.windtaskforce.org/profiles/blogs/battery-system-capital-costs-losses-and-aging

 

NOTE: The above prices compare with the average New England wholesale price of about 5 c/kWh, during the 2009 - 2022 period, 13 years, courtesy of:

 

1) Natural gas-fueled CCGT plants, that have low-cost, low-CO2, very-low particulate/kWh

2) Uranium-fueled nuclear plants, that have low-cost, near-zero CO2, zero particulate/kWh

3) Hydro plants, that have low-cost, near-zero-CO2, zero particulate/kWh

Comment by Willem Post on October 1, 2023 at 4:13pm

It is well known, wind and solar electrons bounce around much more than regular electrons.

Just kidding! As far as PHYSICS is concerned all electrons are the same

If you have too many wind and solar electrons, chaos ensues on the grid, which takes very expensive large scale battery systems to bring back under control.

So, if you have a solar bulge each day, as they do in dysfunctional California (I would be embarrassed/disgusted to be a Governor there), the cost of taming the midday bulge costs about 37.6 c/kWh passing through the batteries.

GO WOKE, GO BROKE AT THE SPEED OF LIGHT

Comment by Willem Post on October 1, 2023 at 4:12pm

BATTERY SYSTEM CAPITAL COSTS, OPERATING COSTS, ENERGY LOSSES, AND AGING

https://www.windtaskforce.org/profiles/blogs/battery-system-capital...

PART 8

Grid-scale Battery System Owning and Operating Cost for Solar Bulge Control

 

Battery systems perform various functions during a day, including absorbing the heavily subsidized, expensive, midday solar bulge, and discharging about 81% of it during the peak hours of late-afternoon/early-evening; the other 19% are system losses. The utility paid at least 10 c/kWh to the Owner, but that was reduced by about 50%, due to various financial tax shelter gimmicks, including the upfront 30% ITC. See Part 4

 

Owners want a return on investment of at least 10%/y, when bank loans and long-term Bonds are 6.5%/y.

The 3.5% is a minimum for the hassles of designing, building, erecting, and paperwork of a project

 

Assumptions for Analysis

 

Assume, in the morning, the batteries are charged at about 20% full, so they can absorb the bulge to about 80% full.

On days, with little or no bulge, the batteries are charged with low-cost, night-time electricity

 

- Bank loan 50%

- State governments want Owners to have at least a 50% investment

- Megapack li-ion systems, $575/kWh for 2023. See Part 1  

- Capacity factor, 0.6

- Owner return, 10%/y for 15 years

- Amortize bank loan, 6.5%/y for 15 years

- Cost of government subsidies, 50% of total costs

- System loss, 19%, from HV AC to HV AC. See Parts 2 and 3 

- System loss, based on from HV grid at 20 c/kWh, to HV grid at 8 c/kWh

- System aging, 1.5%/y is ignored. See Part 7

 

The $0.519/kWh of throughput is significantly understated, because it is based on a very high CF = 0.6, and excludes the cost of system aging

 

All project costs are paid by ratepayers, taxpayers, and added to government debts.

http://www.windtaskforce.org/profiles/blogs/cost-shifting-is-the-na...

 

NOTE: Owners of grid-scale battery systems have the real owning/operating numbers, which they do not make public, because they are “proprietary”  

 

Capacity, 1.0 MW/4 MWh	2023 pricing
Megapack li-ion, $/kWh	575
Capital cost, excludes aging, $	2300000	Energy rating, kWh	4000
Subsidies	50%	Cycles/d	365
Owner return, 10%/y for 15 y	50%	CF	0.6
Amortize bank loan, 6.5%/y for 15 y	50%	Fr. HV grid kWh/y as AC	1081481
Owner return, $/y	148296	In battery, kWh/y as DC	973333
Payment to bank, $/y	120213	To HV grid, kWh/y as AC	876000
Total payments, $/y	268509	System loss, kWh/y	205481
Other costs, O&M, insurance, etc., $/y	40000	Total cost, $/y	454725
System loss, $/y	146216
Total costs, $/y	454725	Cost, $/kWh of throughput	0.519
Paid to Owner by:
Government, as subsidies, $/y	227363		0.260
Utility ratepayers, etc., $/y	227363		0.260
Total, $/y	454725		0.519
Fr HV grid	1081481
$/kWh	0.2
$/y	216296
To HV grid	876000
$/kWh	0.08
$/y	70080
$/y, loss	146216

Comment by Willem Post on September 27, 2023 at 9:38am

Floating offshore wind is the most expensive.

It costs about $7000 to $8000 per installed kW, so 144 MW of ten 850-ft tall wind turbines will cost at least $1.2 billion, plus onshore grid expansion/reinforcement to integrate the new power, which could be about 140 MW on a very windy day or near-zero on a calm day.

Those wind turbines will be visible by anyone on shore even if they are 30 miles away, and at night they will have highly visible strobe lights. The underwater cables will render those areas off limits to fishing and lobstering.

The current state of disarray has the Owners and state governors of at least 15 offshore wind projects on the East Coast begging for even more than the current  50% of subsidies, because costs have gone from $3500/installed kW in 2021 to at least $5500/installed kW in 2023, and bank and bond interest rates have gone from 3% for 20 years in 2021 to 6.5% for 20 years in 2023, plus there  are years of project delays due to a lack of wind turbine building capacity in Europe, and a lack of specialized ships and cranes to erect these 850-ft tall wind turbines.

Comment by Dan McKay on September 27, 2023 at 6:00am

Wind power in Maine is no breeze as regulators move slowly

A deliberate move by the Maine PUC to wear down the opposition?

Comment by Dan McKay on September 25, 2023 at 5:21pm

Massachusetts and Connecticut, the two largest electricity consumers in the New England Region recognize nuclear as a renewable resource and apply certificates of renewable credit to their output. 

Build, baby, build. Save the grid.