71–80 of 106 posts
Yes, more wind will reduce emissions, but these prices don’t mean they will reduce total system cost.
Earlier quoted context omitted.
>* the gas price in the article includes the government’s self-imposed carbon tax. The actual cost of gas (£55) is FAR lower than the £91.20 strike price Milibad has set for wind. Is that unreasonable? Carbon dioxide is an externality, and it needs to be accounted for accordingly. Suppose the government is tendering contracts for milk for school lunches. One farm runs a CAFO[1] that pollutes the local river. The othe…
Yes, it is completely reasonable if you understand the concept of externalities.
This is poor reporting by Elektrek. The article compares wind and gas costs but completely fails to explain: * the gas price in the article includes the government’s self-imposed carbon tax. The actual cost of gas (£55) is FAR lower than the £91.20 strike price Milibad has set for wind. And Miliband has locked in this terrible pricing for 20 years! * there are huge extra costs for wind power that are not accounted fo…
This is an extremely misleading way to report the cost of energy. It’s almost meaningless to compare the cost of wind to the cost of gas because more wind does not reduce the need for gas plant. It may reduce gas utilization, but it will increase the cost of gas on a MWh basis by increasing capacity prices. Yes, more wind will reduce emissions, but these prices don’t mean they will reduce total system cost.
Earlier quoted context omitted.
So, what's auctioned here isn't power. What they're auctioning are what's called "Contracts for Difference". The contract has a "Strike price" which is in essence the price the government (via a for-purpose company) agrees you will be paid regardless of what happens for electricity sold to the system. Now as the word "difference" might suggest there will be a difference between the market price at any particular mome…
I’m missing something. Is the operator paying actual cash money if the market price goes up? It’s not just that they’re forced to produce electricity at a rate that’s possibly less than what it cost to buy fuel? (Or in the case of renewables: producing for less profit than they would if they made their contract later)
You might need to sit down for this. The wind farms don't use fuel. Wind just happens, it's a natural phenomenon that has no real regard for our stupid "wind farm" even as we're harvesting gigawatts of power the wind doesn't ccare.
If you were thinking "Wait I thought all the providers have these contracts, not just renewables" then er no, they're a subsidy, the CfD is a subsidy scheme. That cheap to make, expensive to run open cycle gas turbine some asshole put on a local industrial estate doesn't get a CfD, it can offer to sell the resulting electricity at market prices, and really the big problem is as you observed, that's possibly less than what it costs to buy fuel. Yeah, it is, bad idea to keep building Open Cycle Gas Turbines I reckon. Sure enough the UK almostly exclusively has more expensive to build but cheaper to run Combined Cycle plants.
CfDs are used to subsidise renewable future power. A long term energy independence strategy. Even if you don't care about the planet warming and the sea levels rising you won't be burning all this gas in a thousand years 'cos there's not enough gas. Whereas the sun will shine until long after we're gone, and the accompanying winds won't stop either.
The size of the subsidy varies, if you're building a pilot plant of a new technology that you're sure will revolutionize clean energy but, alas, no-one ever made one that worked before, the government might be willing to pay you four or five times as much money for your energy, partly because they're not expecting you to actually make any energy because you will likely fail. If your plan's big problem is that it's way less mechanically reliable than you'd like, this is a big incentive to incrementally improve that reliability. If your device that involves being in and out of an incredibly powerful tidal stream of corrosive sea water at freezing temperatures makes power but doesn't crack, tear, fall to pieces or explode in the scheduled period of operation you're that much closer to actually having a useful technology and paying you five times over the odds for the MWh you did make is a reasonable price.
a) A load factor of 30% (which seems pretty low for a CCGT), that is actually ~28% (per Annex A [1] "Technical Costs and Assumptions" sheet);
b) fuel efficiency is set to be 54%, which is far lower than BAT CCGT of around 64%, which affects fuel and CO2 emissions costs;
c) the analysis missed out capacity market payments that one gets for having dispatchable power stations;
d) the analysis presumes £41/MWh of carbon costs.
The key drivers of the price are load factor (so amortised construction costs), conversion efficiency (fuel costs and carbon costs) and carbon costs themselves. These make up 90% of the LCOE.
[0] https://www.gov.uk/government/publications/electricity-gener... [1] https://assets.publishing.service.gov.uk/media/6967b0c806fab...
1) Introduce a lot of intermittent generation into energy grid without sufficient amount of storage capacity. 2) Use marginal pricing model which effectively guarantees windfall profits for those sources. 3) Utilization of peaking power plants falls, but you still have to keep them because there is not enough storage capacity. 4) Peaking power plants rise generation costs to offset the lower utilization, further addi…
> Trying to change consumption habits (like smart grids, dynamic pricing, etc.) works poorly, especially for such vital resource as electricity. Why? Has the UK started trying recently? When I lived there nobody gave a hoot about fluctuating prices. It would have been hard to even know when electricity was expensive or not. Has it changed? Meanwhile >three decades ago my grandparents in rural France had a big red lam…
This is poor reporting by Elektrek. The article compares wind and gas costs but completely fails to explain: * the gas price in the article includes the government’s self-imposed carbon tax. The actual cost of gas (£55) is FAR lower than the £91.20 strike price Milibad has set for wind. And Miliband has locked in this terrible pricing for 20 years! * there are huge extra costs for wind power that are not accounted fo…
Capacity is constant. You're talking about capacity factor, i.e., average utilization. Numbers from 2018 for Danish offshore wind farms show capacity factors approaching 50%. These brand-new turbines mounted on 150 meters+ towers in the middle of the North Sea will absofuckinglutely beat that.
https://www.modernpowersystems.com/news/eight-new-uk-wind-fa...
Earlier quoted context omitted.
.. you are commenting on an article about how non-carbon-emitting energy options are beating out polluting alternatives, aided by exactly these taxes, so obviously yes, they are working exactly as intended: price signals for the market to get carbon out of the energy system The purpose of the tax is not to raise money to plant trees, it’s to raise the cost of emissions so that markets move away from them
TFA's claim is offshore wind prices are 40% cheaper than gas. The parent comment stated "actual cost has to price in the impact of using it". Most people would agree on this. However, for both claims to be true, the collected tax revenue must be spent offsetting the impact of that gas usage - not simply reducing gas usage (ie. that consumed gas isn't being compensated for). If the UK government is spending that tax r…
This is an extremely misleading way to report the cost of energy. It’s almost meaningless to compare the cost of wind to the cost of gas because more wind does not reduce the need for gas plant. It may reduce gas utilization, but it will increase the cost of gas on a MWh basis by increasing capacity prices. Yes, more wind will reduce emissions, but these prices don’t mean they will reduce total system cost.
Operating costs dominate the cost of natural gas electricity, not the capital costs. An idled gas plant does save considerable money.
Also, if gas utilization falls dramatically capital costs will come to dominate. It’s not just the turbines, the gas network is costly.