Robert Bryce: Lower- and middle-class Americans will pay a fortune for Biden’s wind-power plan
Last week, the Biden administration announced “a bold set of actions” that it said will “catalyze” the installation of 30,000 megawatts of new offshore wind capacity by 2030. A White House fact sheet claimed the offshore push will create “good-paying union jobs” and “strengthen the domestic supply chain.” One problem: It didn’t contain a single mention of electricity prices or ratepayers.
The reason for the omission is obvious: President Biden’s offshore-wind scheme will be terrible for consumers. If those 30,000 megawatts of capacity get built — which, given the history of scuttled projects like Cape Wind, is far from a sure thing — that offshore juice will cost ratepayers billions of dollars more per year than if that same power were produced from onshore natural-gas plants or advanced nuclear reactors.
Of course, offshore wind will create an armada of problems that go well beyond the price of power. As Rockefeller University environmental expert Jesse Ausubel told me recently, it will require “massive industrialization” of the oceans. Indeed, building 30,000 megawatts of capacity will require anchoring thousands of offshore platforms along our coasts that could pose significant threats to navigation, marine mammals and fisheries.
But the cost issue is the one that deserves immediate attention because any spike in electricity prices will have an outsized impact on low- and middle-income consumers. Those price hikes will be particularly painful in New York and New England, where consumers already pay some of America’s highest electricity prices.
In February, the US Energy Information Administration reported that offshore wind continues to be one of the most expensive forms of electricity generation. The agency estimated that in 2026, producing one megawatt-hour of electricity from offshore wind projects will likely cost about $121. That’s nearly double the cost of generating that same amount of energy with an advanced nuclear reactor ($63) and more than three times the projected cost of producing it with natural gas ($37).
Take away the lucrative federal tax credits, and the EIA projects offshore wind could cost as much as $150 per megawatt-hour in 2026.
The EIA projections enable us to estimate how much Biden’s wind flotilla will cost consumers. If all 30,000 megawatts of offshore wind are built and the turbines operate at a 50 percent capacity factor (meaning they produce at full output half of the time), they will generate about 131.4 million megawatt-hours per year. At $121 per megawatt-hour, that energy will cost about $15.9 billion per year.
Let’s compare that sum with the EIA’s projections for advanced nuclear and natural gas: At $63 per megawatt-hour, generating 131.4 million megawatt-hours with advanced nuclear would cost about $8.3 billion. At $37 per megawatt-hour for natural gas, producing that much energy would cost about $4.8 billion.
Thus, the electricity from 30,000 megawatts of offshore wind could cost consumers roughly $7.6 billion more per year than if it came from advanced nuclear reactors and about $11.1 billion more than if it were produced from gas-fired generators.
Read the full article at:
https://nypost.com/2021/04/09/lower-and-middle-class-americans-will...
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Comment
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Comment by Willem Post on April 18, 2021 at 3:44pm
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All-in Cost of Wind and Solar
The all-in cost of wind and solar, c/kWh = price paid to owners + subsidies paid to owners + grid extension/augmentation (not paid by owners) + grid support services (not paid by owners) + battery systems (not paid by owners)
Pro RE folks always point to the “price paid to owner” as the cost of wind and solar, purposely ignoring or belittling the other cost categories.
Comments on table 2
- The owners of legacy systems were paid much higher prices, than owners of newer systems. This was especially the case after the onset of competitive bidding, a few years ago.
- Vermont legacy “Standard Offer” solar systems had greater subsidies, up to 30 c/kWh paid to owner, than newer systems, about 11 to 12 c/kWh paid to owner.
- Wind prices paid to owner did not have such drastic reductions as solar prices.
- Vermont utilities are paid about 3.5 c/kWh for various costs they incur regarding net-metered solar systems, mostly on roof tops.
- "Added to the rate base" is the cost at which wind and solar are added to the utility rate base, which is used to set electric rates.
- “Traditional cost”, including subsidies to owner and grid support, is the cost at which traditional is added to the utility rate base, which is used to set electric rates.
- “Times” indicates the multiple by which wind and solar are more expensive than traditional
- “Grid support costs” would increase with increased use of battery systems to counteract the variability and intermittency of wind and solar
NOTE:
1) The prices in table 2 should be compared with the NE wholesale grid price, which has averaged about 4.2 c/kWh, starting in 2009, courtesy of low-cost CCGT and low-cost nuclear plants, which provided at least 65% of all electricity loaded onto the NE grid in 2019.
- Wind, solar, landfill gas, and methane power plants provided about 4.8%, in 2019, after 20 years of subsidies
- Pre-existing refuse and wood power plants provided about 4.6%, in 2019.
- Pre-existing hydro power plants provided about 7.4%, in 2019
- The rest was mostly hydro imports from Canada and New York State, in 2019
https://www.iso-ne.com/about/key-stats/resource-mix/
https://nepool.com/uploads/NPC_20200305_Composite4.pdf
2) There are many other costs related to the O&M of the NE grid, in addition to wholesale prices. ISO-NE prorates these costs to utilities, at about 1.6 c/kWh, which is less than the 2.4 and 2.1 c/kWh grid support cost of wind and solar, respectively3) Each utility has its own O&M cost, in addition to item 2, some of which are detailed on electric bills.
4) Vermont utilities buy electricity from various sources. Their costs average 6 c/kWh, plus ISO-NE network, RNS, and capacity, FCM, charges of about 1.6 c/kWh, for a total of 7.6 c/kWh
Table 2/Vermont & NE sources
Paid to
Subsidies
Grid support
GMP
Added to
Total
Traditional
Times
owner
to owner
cost
adder
rate base
cost
cost
c/kWh
c/kWh
c/kWh
c/kWh
c/kWh
c/kWh
c/kWh
Solar, residential rooftop, net-metered, new
17.4
5.2
2.1
3.5
20.9
28.2
7.60
3.7
Solar, residential rooftop, net-metered, legacy
18.2
5.4
2.1
3.5
21.7
29.2
7.60
3.8
Solar, com’l/ind’l, standard offer, new
11.0
6.2
2.1
11.0
19.3
7.60
2.5
Solar, com’l/ind’l, standard offer, legacy
21.7
10.5
2.1
21.7
34.3
7.60
4.5
Wind, ridge line, new
9.0
4.1
2.4
9.0
15.5
7.60
2.0
Wind, offshore, new
12.1
5.4
2.8
12.1
20.3
7.60
2.7
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Robert,
Here is another boondoggle
https://www.windtaskforce.org/profiles/blogs/high-costs-of-wind-sol...
GMP-OWNED SOLAR/BATTERY COMBO IN PANTON, VERMONT
GMP has built a solar/battery combo, on 35 acres of farmland, in Panton, Vermont, a rural area. The $17.7 million solar/battery combo, would provide power, for a few hours, during rare power outages, at first to about 50 users, such as Town Hall, police, fire, EMS, etc., later to additional users. See URL
https://www.epa.gov/sites/production/files/2016-07/documents/re_on_...
- The battery system, 10 Tesla Powerpack units, would deliver 1,000 kW for 4 hours, or 500 kW for 8 hours, etc.
- It would be connected to many users with its own distribution system.
- If the normal distribution system is down, the emergency distribution system would take over.
- The extent and turnkey capital cost of the emergency distribution system likely would be known to GMP
Turnkey capital cost of the 4.9 MW solar system, was about 4.9 MW x $3.0 million/MW = $14.7 million
Turnkey capital cost of the 1 MW/4 MWh battery system was about 4000 kWh x $750kWh = $3.0 million. See URL
https://www.vpr.org/post/green-mountain-power-eyes-panton-states-se...
Table 5/Battery Capital cost
1 MW/4 MWh
$/kWh
$million
Battery modules, Tesla price, FOB
300
1.2
Bi-directional inverters
Thermal management system
AC main breaker and controls
Battery complete, Tesla price, FOB
500
2.0
Land
Site preparation
Foundations
Electrical and substation
Test operation
Turnkey capital cost, per GMP
750
3.0
Production of Panton Solar System
Production data and capacity factors are shown in this URL
Peak daily production was 1.272 MWh at a capacity factor of 34.891% on May 1, 2020
The annual average CF is about 0.20, which is greater than normal (0.145), because, instead of panels at a fixed angle, the panel angle is automatically varied during the day, to better face the sun.
http://www.wvwelectric.com/plant/60562/M/SUN
Midday Solar Output Bulge
The midday-solar bulge would be a maximum of about 4.9 x 0.8 = 3.92 MW, during a very sunny, summer day
The battery system would absorb electricity to reduce the bulge by about 1 MW.
GMP likely knows how much that 1 MW reduction benefits the stability of the distribution grid
During the late-afternoon/early-evening, the battery would discharge “the bulge”, at 1 MW, and thereby reduce the GMP peak demand.
GMP likely knows how much that 1 MW reduction would benefit GMP and ratepayers.
Economics of Solar Project
Mortgage payments for the solar system, $14.7 million at 3.5%/y over 25 years, would be $883,100/y. See table 6
https://www.myamortizationchart.com
Solar production is about 4900 kW x 0.200, CF x 8766 h/y= 8,590,680 kWh/y
Solar revenue would be 8,590,680 x 11 c/kWh = $944,975/y
Mortgage cost of solar electricity would be $883,100 / 8,590,680 kWh = 10.28 c/kWh
The 10.28 c/kWh is only the financial cost, i.e., “paying the mortgage”
GMP sells the electricity at about 11 c/kWh, as part of the VT “Standard Offer” program.
GMP can sell at this price, because it gets subsidies that reduce the cost of 19.3 c/kWh, to about 11 c/kWh. See table 2
If the solar project had an average of 9%/y return on invested capital, the owner would need to receive $1,480,342/y, for each of 25 years, to recover the project capital of $14.7 million.
The owner receives from electricity sales 8,590,680 kWh/y x 11 c/kWh = $944,975/y.
The owner receives from subsidies 1,480,342 - 944,975 = $535,367/y, or $535,367 / 8,590,680 kWh/y = 6.23 c/kWh
Total paid to owner = 11 + 6.23 = 17.23 c/kWh. See table 2
Each year, a solar project has other costs, just as a house, which are transferred to rate payers and taxpayers and government debt (certainly not to the owner), which would increase the cost of electricity from 17.23 c/kWh to at least 19.3 c/kWh. See tables 2 and 6
Economics of Battery Project
Mortgage payments for the battery system, $3.0 million at 3.5%/y over 15 years, would be $257,357/y. See table 6
https://www.myamortizationchart.com
ISO-NE FMC and RNS Charge Reduction: Significant revenue can be obtained by having the batteries reduce the utility MW draw from the NE grid, during peak hours.
RNS reduction would be 1,000 kW x $9.69/kW-month = $9,690 for a month, or $116,280 for 12 months
FCM reduction would be 1,000 kW x $5.30/kW-month = $5,300 for a month, or $63,600 for 12 months. See table 6
Midday Solar Bulge Reduction: The battery could absorb 0.45 MW of solar output from 8 am to 4 pm = 0.45 x 8 = 3.6 MWh as DC; which after a loss of 7%, would add 3.35 MWh DC to the battery charge, which after a 10% loss, would deliver 3.01 MWh AC to the distribution grid, from 4 pm to 10 pm, when, on average, grid prices are 7 c/kWh. The solar electricity costs 17.23 c/kWh, as above calculated. The bulge control loss would be $97,519/y. See table 6 and Note
Would that loss be charged to owners of solar systems, who are the grid disturbers? Oh no, because that would "rain on the solar parade"
NOTE: If solar system owners would be charged a midday-bulge-control fee, the battery project would have another revenue stream
Arbitrage: The battery could be partially charged from the grid from 10 pm to 6 am, at about 4 c/kWh, and be charged some more by absorbing a part of the midday solar bulge from 8 am to 4 pm, after which it would be discharged to the distribution grid from 4 pm to 10 pm, when, on average, prices are 7 c/kWh. The arbitrage gain would be $7,653/y. See table 6 and Note
NOTE: The solar electricity would cost 17.23 c/kWh. The quantity would be hard to determine, except by measurement. This calculation uses 4 c/kWh for all charging, i.e., the arbitrage gain is overstated.
If the battery project had an average of 9%/y return on invested capital, the owner would need to receive $365,136/y, for each of 15 years, to recover the project capital of $3.0 million.
The battery electricity input is about 3600 kWh/d x 365 = 1,314,000 kWh/y
The battery electricity output is about 3000 kWh/d x 365 = 1,095,000 kWh/y
The battery loss is 219,000 kWh/y, that could not be sold at 11 c/kWh/y.
The loss of 219,000 kWh/y x 11 c/kWh = $24,090/y, should be charged to the battery. See table 6
The owner receives $187,533/y, revenues + $55,994/y, subsidies + $121,609/y, other sources = $365,136/y, or $365,136 / 1,095,000 kWh/y = 33.3 c/kWh
- The net revenue is 179,880, ISO-NE charge reduction + 7,653, arbitrage = $187,533/y
- Battery subsidies would be $55,995/y
- From other sources, likely ratepayers and taxpayers, would be 97,519, bulge reduction + 24,090, battery loss = $121,609/y, reduction
- No cost ever disappears, per Economics 101
Table 6/GMP Combo
ISO-NE charges
Mortgage
Bulge control
Arbitrage
FCM
RNS
MW
0.45
From grid, MW
0.45
5.3
9.69
Solar capacity, MW
4900
h
8
h
8
1000
1000
Capacity factor
0.200
To battery, MWh
3.6
To battery, MWh
3.6
12
12
h/y
8766
Loss fraction
0.07
Loss fraction
0.10
63600
116280
Production, kWh AC/y
8590680
Loss, MWh
0.25
Loss, MWh
0.36
179880
"Mortgage", $/y
883100
In battery, MWh, DC
3.35
In battery, MWh, DC
3.24
Solar cost, c/kWh
10.28
Loss fraction
0.10
Loss, fraction
0.10
Loss, MWh
0.33
Loss, MWh
0.324
To grid, MWh, AC
3.01
To grid, MWh, AC
2.92
Charge cost, c/kWh
0.17
Charge cost, c/kWh
0.04
Charge cost, $/d
519
Charge cost, $/d
117
Peak cost, c/kWh
0.07
Peak cost, c/kWh
0.07
Revenue, $/d
252
Revenue, $/d
204
Loss/d
267
Gain/d
87
Loss, $/y
97519
Gain/y
7653
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Don't put the useless subsidy crap here, don't put the unreliable graft generating elitist supported wind crap there, put it where you can shove it down the poor peon bastard's throat who can't raise enough money and support to stop the wasteful left wing economic agenda , in their back yard.
Maine as Third World Country:
CMP Transmission Rate Skyrockets 19.6% Due to Wind Power
Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.
Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT
******** IF LINKS BELOW DON'T WORK, GOOGLE THEM*********
(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 https://www.pinetreewatchdog.org/wind-power-bandwagon-hits-bumps-in-the-road-3/From Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" https://www.pinetreewatchdog.org/wind-swept-task-force-set-the-rules/From Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.” https://www.pinetreewatchdog.org/flaws-in-bill-like-skating-with-dull-skates/
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Hannah Pingree on the Maine expedited wind law
Hannah Pingree - Director of Maine's Office of Innovation and the Future
"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."
https://pinetreewatch.org/wind-power-bandwagon-hits-bumps-in-the-road-3/
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