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Giant batteries drain economics of gas power plants

reuters.com

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Re: Giant batteries drain economics of gas power plants

#131

Post by bsder »

dpierce9 wrote: post #39
Emma_Goldman wrote: post #11

> "Without providing price detail, which companies say is commercially sensitive, Clarke said Carlton had struggled to finance the planned gas plant in part because of uncertainty over the revenues it would generate and the number of hours it would run." This is the crucial point. Political uncertainty about the future energy system is jacking up the rate of return investors are demanding of gas plant projects withou…

Why call this political uncertainty as opposed to economic uncertainty? The future is intrinsically uncertain. The only thing that has changed is new entrants to the market. If gas plants can be replaced by something cheaper then they will be. If gas plants make economic sense, they will be built. The fact that gas developers have to model additional players in their markets to prove their economic viability seems fi…

> If gas plants can be replaced by something cheaper then they will be. If gas plants make economic sense, they will be built.

Eventually, the system will land in a semi-stable equilibrium. Getting there may be quite painful, though.

Capitalism is NOT an inherently stable system when the time scales of production and consumption have a mismatch. Look at farming and the feast/famine cycles it goes through. Practically all "developed" countries stabilize their agricultural sector, somehow, precisely for this reason.

Capitalism will happily take plants offline faster than new investment can replace. The grid needs a certain amount of base production or it becomes unreliable--which defeats the whole point of a "grid" in the first place.

Batteries are not enough by themselves. You need a combination of batteries, solar, HVDC links over larger areas (to give you diversity to ride out weather), gas plants, and nuclear plants. Many of these will be unprofitable to build but are necessary.

Re: Giant batteries drain economics of gas power plants

#132

Post by creer »

AnthonyMouse wrote: post #123
creer wrote: post #95

Earlier quoted context omitted.

I must say I fail to see how any of this is all that new. Winter affects how much air conditioning and heating is needed - and probably even when people go to work and return. You had to take that into account before solar issues. Now both consumption and production are affected by the season, sure, but that's still a known mechanism. Same for cloudiness vs air conditioning (and heating and lighting). But wait, in mo…

> I must say I fail to see how any of this is all that new. The difference is the scale. Traditionally you had a particular amount of base load that would run all the time. Nuclear and coal. The load never dropped below their generation capacity so they never had to stop generating and making money to recover their construction costs. Then you would have natural gas peaker plants that only ran for part of the day, bu…

I think the article is not so much about how more difficult it is to price the energy of a gas peaking plant but instead about changing strategies by developers of such plants. There is the temptation to switch to battery plants now rather than later. There is the change in the equation that such plants used to be mostly priced by the energy provided (in contracted amounts) and that now they are more charging for contingency / continuity service. That is they are charging for a different service: not paid by the kW/hr but by the capability to produce on demand. And then subsidies, permitting, environmental concerns also are changing: easier to build batteries, hard to build gas. And lenders having to follow in the change in profitability mechanism.

Re: Giant batteries drain economics of gas power plants

#133

Post by wortelefant »

bell-cot wrote: post #16

The reality is much more complex than "batteries replace gas" - > Developers can no longer use financial modelling that assumes gas power plants are used constantly throughout their 20-year-plus lifetime, analysts said. > Instead, modellers need to predict how much gas generation is needed during times of peak demand and to compensate for the intermittency of renewable sources that are hard to anticipate. > "It does…

Complexoty causes high system costs at scale for energy grids with a large amount of intermittent renewables. Adding more stable adjustable sources like nuclear, hydro or geothermal will become more attractive than creating wildly intricate "smart grid" architecture. Just produce more power when needed instead of costly redistribution and storage.

Re: Giant batteries drain economics of gas power plants

#134

Post by bokohut »

bell-cot wrote: post #16

The reality is much more complex than "batteries replace gas" - > Developers can no longer use financial modelling that assumes gas power plants are used constantly throughout their 20-year-plus lifetime, analysts said. > Instead, modellers need to predict how much gas generation is needed during times of peak demand and to compensate for the intermittency of renewable sources that are hard to anticipate. > "It does…

Superb analogy indeed as this is the same approach I use in my next pursuit in breaking through to those from a technology background. The cache sources can be anything providing energy to be stored in the rapid response system while the cache system itself is modular in design allowing ingress and egress simultaneously based on inputs and outputs of demand. The fun part is designing and writing the software to control all the "cache" hardware. I have no idea what I am talking about though but I did stay in a Holiday Inn last night... or was it a Motel 6. :)

For those with their ear on the track when that sound resonates they will see the light, everyone else will be in the dark without energy storage. Costs are spiking everywhere and the U.S. government is having meetings near weekly exactly about this coming fun. Those meetings reflect frank direct statements about coming derailments and the grid has not changed since its inception and remains to be centralized to this very day. There are enough smart technologists here that can put together exactly what I infer, significant opportunity.

For those further interested check out YT: "Environment Hearing: Clean Power Plan 2.0 Will Jeopardize Reliable and Affordable Energy". As with anything making significant revenues however those threatened with revenue loss will play the dirtiest games to preserve their position, this includes increasing the pollution output that is making that revenue.

Stay Healthy!

Re: Giant batteries drain economics of gas power plants

#135

Post by bumby »

QuarterReptile wrote: post #99
bumby wrote: post #47

Earlier quoted context omitted.

I think you're right, but wouldn't this still necessitate freight to travel by truck from rail centers to population centers? That's how a lot of the system currently operates in the US, no?

There should be no population center without a rail center. I don't deny that last-mile would still be on roads, but that's very different from the present state of affairs. My lazy googling suggests that 40% of freight movement is via rail in US. I can't find a full breakout, but the same site goes on to claim rail is only 1.7% of GHG, which means most of the rest is traveling by road, since waterborne freight is ge…

You do know we’re not starting with a blank slate, so how do you close that gap? Forced migration?

Re: Giant batteries drain economics of gas power plants

#136

Post by s1artibartfast »

bumby wrote: post #128
s1artibartfast wrote: post #124

Earlier quoted context omitted.

>The industrial revolution had been decades underway before cheap oil, and would have continued if oil was never found in Pennslyvania. But cheap oil definitely helped speed it along faster. That is certainly true. I meant using it a benchmark to extrapolate from. In many ways it seems to me that the industrialization at that time had a pretty negative trajectory, with a heavy basis in coal and brutal industrial town…

I don't think the fuel type, but rather the labor and regulatory environment, was the driver of those conditions. We can't know for sure, obviously, but had oil been used before coal, I have a feeling those towns would still exist.

I agree that's probably a big part of it. Another interesting thought is that if we never moved off of coal we would probably have a lot more electrification and mass transit because call makes more sense in terms of centralized power generation. Sounds like the makings of a steampunk novella

Re: Giant batteries drain economics of gas power plants

#137

Post by matthewdgreen »

NoMoreNicksLeft wrote: post #68
matthewdgreen wrote: post #49

Earlier quoted context omitted.

The appropriate counterfactual here is if we'd made investments into renewables back in the 70s/80s/90s of a scale similar to those we made in the 00s/10s/20s. It's not really clear what the result would have been. To really answer this you'd need to unpack the past two decades' worth of cost decreases in (e.g.,) PV and see how many of them would have been possible with late-20th century technology. My uneducated gue…

This seems like a fallacious argument. If investing earlier leads to earlier results, why aren't you complaining that we didn't start investing in renewables research in Roman antiquity? Premature investment doesn't lead to early results, just wasted money. There is an optimum time for such, and it's almost certainly true that this time wasn't in the 1970s, the technology simply wasn't possible. The 1970s do not repr…

The question I’m asking is how much faster we could have pulled forward widespread renewables deployment with an earlier commitment to the project. My (non-expert) guess is that a decade might have been possible. Your view is that -2000 years probably wasn’t possible. I don’t think we’re in any major disagreement on those points, so the interesting question is about values in between.

Re: Giant batteries drain economics of gas power plants

#138

Post by TMWNN »

gwbas1c wrote: post #100

A few years ago I scraped some publicly-accessible data from https://www.iso-ne.com/ regarding the spot cost of electricity. Then I fed it into a battery simulator that I wrote. Based on my estimated cost of a grid-scale battery, I estimated a payoff in ~2 years; and then a lot of profit. The biggest challenge is the politics and red tape of connecting something to the grid. The grid operators are used to power plant…

>Based on my estimated cost of a grid-scale battery, I estimated a payoff in ~2 years; and then a lot of profit.

Is this applicable to the South Australia Powerwall installation?

Re: Giant batteries drain economics of gas power plants

#139

Post by gwbas1c »

TMWNN wrote: post #138
gwbas1c wrote: post #100

A few years ago I scraped some publicly-accessible data from https://www.iso-ne.com/ regarding the spot cost of electricity. Then I fed it into a battery simulator that I wrote. Based on my estimated cost of a grid-scale battery, I estimated a payoff in ~2 years; and then a lot of profit. The biggest challenge is the politics and red tape of connecting something to the grid. The grid operators are used to power plant…

>Based on my estimated cost of a grid-scale battery, I estimated a payoff in ~2 years; and then a lot of profit. Is this applicable to the South Australia Powerwall installation?

My simulations were based on the iso-new England grid's spot fees. I estimated the cost of a grid scale battery based on what I paid for my powerwall, because I couldn't get data on the price of the mega pack.

I couldn't tell you if you'll save money with a powerwall in Australia. You'll need to look up local incentives for that. Understanding the economics of a power grid, it's only worth it if you have solar and don't have typical American-style "net metering," or you have solar and need backup for power outages.

What I can tell you is that, in the US, in 2019, I got a rebate for my powerwall that made it price competitive with a standby generator. (Cost a little more, but I don't pay for annual maintenance or fuel.) I don't feed into the grid with it. The incentives would need to be pretty lucrative, though, because if there's a power outage overnight, it'll drain fast! (All my outages since I got it happened during the day.)

What I can also tell you is that Tesla made a lot of headlines hooking up a grid scale battery to balance out an Australian wind farm. It prevented a frequency drop when a coal plant went offline.

Re: Giant batteries drain economics of gas power plants

#140

Post by TMWNN »

gwbas1c wrote: post #139
TMWNN wrote: post #138

Earlier quoted context omitted.

>Based on my estimated cost of a grid-scale battery, I estimated a payoff in ~2 years; and then a lot of profit. Is this applicable to the South Australia Powerwall installation?

My simulations were based on the iso-new England grid's spot fees. I estimated the cost of a grid scale battery based on what I paid for my powerwall, because I couldn't get data on the price of the mega pack. I couldn't tell you if you'll save money with a powerwall in Australia. You'll need to look up local incentives for that. Understanding the economics of a power grid, it's only worth it if you have solar and do…

> What I can also tell you is that Tesla made a lot of headlines hooking up a grid scale battery to balance out an Australian wind farm. It prevented a frequency drop when a coal plant went offline.

This is what I was referring to; I was wondering whether your calculation would apply to it.

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