Book Review: Shorting the Grid
Where is our country headed, according to Meredith Angwin? Blackouts, lots of blackouts.
This book is eye-opening! Through 2020, I had spent my whole career in upstream oil and gas and wind (i.e. extraction); I had a limited knowledge of midstream (i.e. how you transport energy). Until recently, when I launched a bitcoin mining company, I hadn’t had any reason to learn power generation (i.e. electricity and distribution). This book is packed with so much wisdom that it is not possible to distill it down. Instead of such a futile attempt, I instead chose to try and break down some of the biggest ah-has that fell upon me. I highly recommend anyone wondering about electricity and how it all works actually read the full book. Thankfully for us all, Angwin is very witty and cracks some great jokes (including a Star Wars reference), which made her work a complete joy to read.
Two Worlds: Vertically-Integrated Utilities and Regional Transmission Organizations
In Angwin’s view, the world is bifurcated into two epochs. The first is the vertically-integrated utility era.
Prior to the RTOs of the 1990s, vertically integrated utilities were responsible for power generation, transmission, and distribution. Questar Corporation, now Dominion, in Utah is a good example of a vertically integrated utility area that’s survived and not joined a RTO. If Questar spent CAPEX, it would be guaranteed a 20% IRR on its investment, regardless of it was necessary or not. This led to inefficient spending by the utility of course. However, it also resulted in a well-built (if not overbuilt) power grid complete with abundant power generation assets, transmission, and distribution. In the pre-RTO model, reliability was a feature.
The second is the post-1990s “deregulation” era that birthed RTOs (Regional Transmission Organizations) and ISOs (Independent System Operator) - which are essentially RTOs. The logic of the time was deregulation worked for telephones and airlines, so it must work for electricity too. As states began to opt-in, something unexpected occurred - reliability became a bug and possibly and anti-feature.
In the post-RTO world, no entity - not the RTO/ISO, FERC, power plants, utilities, capacity markets, nor the State itself - was responsible for reliability. Not even the famously named (and increasingly unstable) Electricity RELIABILITY Council of Texas (ERCOT) is responsible for reliability. Now, citizens of both California and Texas are rushing to purchase diesel generators to backup their increasingly unstable grid systems.
“Paradoxically, competitive markets appear to attract more regulation.… The tariffs (rules) that govern the competitive ISOs are approved by the Federal Energy Regulatory Commission (FERC) … (these) tariffs governing ‘market’ relations are enormously complex, spanning several times the length of the tariffs that govern the vertically integrated monopolies …”
In this sense, the “ratepayer” is still the correct term to use because “customers” would have the ability to choose their power and providers. The result of Angwins research regarding RTO areas vs. non-RTO areas is that electricity is MORE EXPENSIVE in RTO areas than if they were in the vertically integrated monopoly.
Come to find out Angwin’s conclusions regarding RTO vs. Non-RTO area prices are similar to my unexpected conclusion regarding mandated (RPS) grid emission targets vs. non-mandated (RES) grid emission targets.
I’m honored that she enjoyed my research. She also notes in her book a study from the University of Chicago that concluded the same.
“The authors estimated that consumers in the states with renewable portfolio standards had paid a total of $125 billion more for electricity than they would have paid without the policies.”
Liar Loans
In 2008, the credit market had little oversight and people who had no business qualifying for home loans were getting them with ease. “Liar loans”, as they were called, were common. The borrowers weren’t asked to provide documentation, their credit wasn’t checked, and there were no down payments. In the old days, mortgages would only be given to a surgeon with a sizable down payment, high income, and high credit rating. Contrasting liar loans that led to the sub-prime mortgage crisis to healthy loans is a great analogue to what’s been happening to our grids.
“A varied grid meant that, if one fuel had shortages or rose in price, the grid would still be stable, and cost would remain relatively stable.” In the post-RTO world, none of these things matter; the RTO grid is like Liar Loans. Reliable power can’t make a profit; utilities are leaving RTO areas; and power installations are now only able to operate intermittently. Pre-RTO, regulatory bodies wanted to see reliable power plants and power plants that were able to use several different types of fuels.
“In the mortgage situation, the intrinsic value of the mortgage didn’t matter. In the RTO area, the value of the power produced doesn’t matter. As a matter of fact, less-valuable power is more profitable. Trouble is sure to come, and it is on its way. In these areas, we are on our way to an expensive and fragile grid.”
How the Grid is Powered
Come to find out, the power plants powering our grids do not make profits by doing their jobs (generating power) in a RTO. This statement applies to all fuels - oil, coal, natural gas (single and combined cycle), wind, and solar. They require capacity, ancillary, and government subsidies (PTC/REC).
NG-CC is natural gas combined cycle; ST-Coal is steam-turbine coal; NG/Oil ST is natural gas or oil using steam turbine cycle; NG/Oil GT is natural gas oil-gas turbine
Nuclear is the closest to generating a profit by selling electricity (kWh). Natural Gas (and to the extent oil is used, oil) relies upon capacity markets. Meanwhile, wind (and solar) require Production Tax Credits (PTCs) and Renewable Energy Credits (RECs) in order to get there. This matters.
Capacity Markets
“In many RTO areas, plants sell “available capacity” whether or not they are making power at the moment. Power plants get capacity payments, and they can use these payments to maintain their plants. ”
How do these markets work? Here’s how it works.
““I’m the RTO, and I need 500 MW right now, or rather, I need it for the next five minutes. The auction runs every five minutes.” Power plant A steps up: I’ve got 200 MW for you, at 15 cents per kWh. Plant B steps up: I’ve got 100 MW for you, at 20 cents per kWh. Plant C steps up: I’ve got 300 MW for you, at 30 cents per kWh. I’m the RTO, and I answer: “Okay, plant A and plant B, I’ll take all your output. Now I have 300 MW. Plant C, I’ll buy 200 MW of your output, but I don’t need all 300 MW. I’ve got my 500 MW now. “All you plants, you get 30 cents per kWh for your output. Plant C has set the clearing price for this round.”
Capital costs are not allowed in your calculation of how much you bid. However, outside sources of income are allowed and welcome. If you are paying off a high-priced plant, you can’t add any of that expense into your energy bid. But if you are receiving payments for Renewable Energy Certificates, you can take those payments into account and bid at a lower cost for your kWh.”
In a way, natural gas is winning the capacity market game. In another way, it’s renewables who are bidding negative (they pay the RTO to take their electricity) who are winning the capacity markets because they make their windfalls by selling RECs and receiving PTCs. In Texas and California, the situation is much direr.
“ERCOT, the Texas RTO, and CAISO, the California RTO, did not implement such capacity payments.”
The lack of capacity payments in ERCOT and CAISO has led to the increasingly deteriorated status of formerly reliable power plants (coal, oil, nuclear, natural gas). These states have meanwhile over-incentivized wind and solar forcing these formerly reliable power plants to generate intermittently because wind and solar generate intermittently. These systems are crumbling before our eyes.
“The introduction of capacity markets in RTO areas “has an asymmetric effect on the risk profile of different generation technologies, tilting the resource mix toward those with lower fixed costs and higher operating costs.” … a power plant in the PJM RTO area that uses inexpensive fuel can expect to earn 17% of its operating profit from the capacity market, while a plant that uses expensive fuel can expect to earn 90% of its profit from the capacity market.”
Plants that were built to run 24/7 and efficiently, like combined cycle natural gas plants, are being ditched in favor less desirable and higher cost single cycle “peaker” plants.
PTCs & RECs
Warren Buffet’s comments on wind in 2014 have come home to roost. Now, Texas, California, and Oklahoma have built about 50,000 MWs of wind turbines.
“I will do anything that is basically covered by the law to reduce Berkshire’s tax rate. For example, on wind energy, we get a tax credit if we built a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”
Wind and Solar developers were paid by the government to build them, and now they are being paid by the government to operate them.
“As noted in chapter 15, “Selling kWh Is a Losing Game,” in many cases, renewables don’t have to make any money by actually selling their energy to the grid. They make money by selling RECs (Renewable Energy Certificates) and by receiving production tax credits. Renewables can pay the grid to take their power (negative pricing) and still come out ahead financially.”
RECs and PTCs do not get paid unless they generate electricity. Historically, PTCs were equal to 2.4 cents per kWh (when Oklahoma’s retail electricity power price was about 6 cents per kWh). Under the newly replenished PTC program under Biden’s, analysis suggests that the all-in credit is going to be raised to 3.1 cents per kWh.
RECs are how all these companies claim they are “100% renewable”, a fraud that John Oliver has wakened to.
“Usually, RECs are sold to a distribution utility in a state that requires utilities to use a certain percentage of renewable power. ”
In the case of Vermont, they were double-booking their RECs.
“I would like to say that my state came to its senses, decided to straighten up and fly right, that it decided not to double-book anymore, and that it had a change of heart. However, that is not what happened. Starting around 2015, Vermont’s double-booking became a controversy that spread beyond Vermont. The Federal Trade Commission warned Green Mountain Power about its Renewable Energy claims, but ultimately backed off from prosecuting the utility for fraud. Meanwhile, as described in a Utility Dive article, NextEra Energy dropped its purchases of Vermont RECS. The NextEra decision followed another decision: the Connecticut legislature had placed a ban on purchasing Vermont credits.”
Thus, wind and solar power plants are able to make 3.1 cents per kWh from the newly passed IRA’s PTCs and an additional 1-6.75 cents per kWH from selling (and double-selling) their RECs to states with mandated renewable targets like those posted to PJM EIS - all while bidding negative into the capacity markets and financially harming reliable power plants.
Wind and Solar Cost More
As Angwin notes, while putting downward pricing pressure on clearing price sounds like it’s good for the consumer, it is not.
“This is widely trumpeted by renewable advocates as “Due to renewables, prices are going down.” But there is a catch. They mean “wholesale prices on the grid kWh auctions are going down.” Prices to the consumer are going up.”
Some of the reason for this is due to compliance costs for renewable portfolio standards (RPS).
““compliance costs to load” by state, for selected time periods in 2015. Compliance costs are the extra costs imposed by meeting the state’s renewable portfolio standards. The costs varied from 0.2 to 0.3 cents per kWh (Maine) to 1.1 to 1.6 cents per kWh (Massachusetts).”
In other states, where it is legal, some of it is due to net metering:
“The net-metered solar owner gets paid, say, 14 cents per kWh (his retail cost) for supplying electricity that the grid could buy for 5 cents from a fossil or nuclear plant.”
Some of the reason is due to curtailment cost.
“In some areas, wind turbines get paid if they cannot get online at the times that they are available. Only renewables get this type of payment. For example, in Washington State, the Bonneville Power Administration used to ask thermal generators (such as coal, oil, and gas) to go offline when the rivers were full and hydro plants could make lots of inexpensive power. Bonneville Power is both the authority running most of the hydro plants for the Northwest and the Balancing Authority for that area. Not being dispatched was okay with thermal plants, because they didn’t burn fuel when they weren’t dispatched. However, as wind turbines became a bigger presence in the Bonneville region, their owners complained to FERC about not being dispatched when the rivers were running high. When a wind turbine is able to run (the wind is blowing) but it is not dispatched, it loses the money it could have made in production tax credits and selling RECs. FERC agreed with the wind turbines, and now Bonneville Power has to compensate the wind farms for lost revenue if it does not dispatch them when the wind is blowing. The wind turbines must be paid when they are curtailed.170 This ruling is only for the Pacific Northwest: wind turbines in other areas are paid or not paid when curtailed, depending on the jurisdiction. It would take a nationwide research project to estimate what consumers pay for curtailing wind, in each area and each month.”
Some of it is due to redundancy costs:
“NBER study, a worldwide review, determined that a grid needs 1.14 MW of installed fossil capacity for each MW of intermittent renewable capacity.”
Then there are transmission costs:
“The costs of transmission are steadily going up. Some fraction of the increased costs of transmission are due to the expense of connecting far-flung renewables to the grid. However, it is almost impossible to say whether this is a large or small portion of the increased costs.”
I’d like to note that none of these costs are included in Lazard’s Levelized Cost of Energy (LCOE) for wind or solar power generation (which many renewable advocates like to use to suggest wind and solar are cheaper than reliable generation like natural gas and nuclear).
Capacity Factor vs. Capacity Value
This is a massive distinction that needs attention. Lazard’s LCOE calculation uses capacity factor. That is, under perfect conditions (abundant sunshine and abundant wind) how much of the total capacity could be used in a given timeframe. Wind’s capacity factors range from 26% to 52%. Utility-scale solar ranges between 16% and 30%. However, that’s not how it works in the real world. In the real world, Angwin coins the term Capacity Value (I chose to coin a synonym for it, Value Factor). That is, can it actually generate when called upon?
“According to a PJM report in September 2018, the mean effective load-carrying capability for wind was 11.5% of nameplate capacity. That number is a type of estimation of wind’s capacity value. In contrast, wind capacity factors range between 22% and 45% (nationwide figures from EIA).”
So, if a market needed 1,000 megawatts of baseload, it would have to build a 1,885-megawatt wind farm at a cost of $3.303 billion. Then, that 1,885 MW wind farm would have to be backed up with 1,114 MW of inefficient single-cycle “peaker” plants (more efficient combined cycle built to run 24/7 and with lower emissions can’t backup intermittency easily) at a cost of $753 million. So, the total cost for 1,000 MW of demand in a market is $4 billion (and that doesn’t count transmission or distribution; that’s just for power plants). And the wind and solar players are playing the game well.
“By bidding in at a low “capacity value,” a wind turbine will receive some capacity payments, but they won’t get hit too badly with fines if the wind doesn’t blow. That is the wind turbine’s way of looking at the capacity value, perhaps. From the grid’s point of view, capacity value estimates how valuable the wind turbine is to the grid. For example, if a traditional power plant bids into a capacity auction, it generally bids at its nameplate capacity, or close to it. If a wind turbine bids in at 10% of its nameplate capacity, it is pretty much admitting that it is only 1/10 as valuable to the grid as a standard dispatchable power plant. [emphasis added]”
Plug 11.5% into Lazard’s LCOE calculation instead of 45% and the outcome is drastically different.
“For zero-emissions cases without firm resources, the total required installed generation and storage-power capacity in each system would be 5 to 8 times the peak system demand, compared with 1.3 to 2.6 times peak demand when firm resources are available.”
The Miracle That is the Grid
This concept of near-instant balancing is nothing short of miraculous; Balancing Authorities are the closest thing to wizards that exist in our world today.
“THE REQUIREMENTS FOR electricity on the grid are neither constant nor fully predictable, and electricity must be manufactured and then used within milliseconds. Making more or less electricity than is immediately used will mess up the grid, first by changing the frequency of the electricity, and later by causing other problems, such as area-wide blackouts. ”
This means if grid demand is 1,000 megawatts, the supply must be exactly 1,000 megawatts and in real-time! Now, imagine a wind farm stops generating because the wind stops blowing or a solar farm stops generating because of clouds or snow or other mechanical failures. The Balancing Authority, or grid operator, must replace that unplanned and lost generation within milliseconds or risk area-wide blackouts!
Reliable fuels - thermal fuels like coal, oil, nuclear, and natural gas - operate just that way, reliably. They generate what’s called “grid inertia”, turning a massive rod that will keep generating power even if the thermal source fails. When the power source fails, that rod keeps spinning (generating electricity) for as long as fifteen minutes, unlike wind and solar which cease immediately and unexpectedly. Thermal fuels give the BA time to balance the grid where renewables (wind/solar) do not.
“Renewables often make the BA’s job harder. They depend on real-time conditions (sun, wind), and the BA cannot order them online to match requirements. The BA can ask them to get offline (called “curtailing”), however. So the BA’s options are more limited for solar and for wind. As a general rule (there are some exceptions), a BA cannot control when customers use power. With wind and solar, the BA also cannot control when power is available. ”
Before you go and shout, yes, but grid storage! Grid storage technology is wishful thinking.
“People have been working on storage since I entered the workforce, more than forty years ago. Some improvements have been made, but the barriers are huge. Storing electricity means losing some energy on the round trip: power into the storage, power out of the storage. This will waste some power. Some power absolutely will be lost to the round trip. Also, if we choose battery storage, we have to realize that manufacturing batteries is resource intensive. For example, it would take vast amounts of specialty mining if we decided that we needed to build lithium batteries at grid scale.
People who are sure-in-their-hearts that renewables can do everything usually assume that the storage problem is solved somehow. It isn’t. And such people rarely acknowledge that any storage solution will be subject to the materials-availability issue and the round-trip-power-loss issue. Moreover, to store electricity and use it later, we will have to make more electricity than if we used it immediately.”
The Backwardation of New England Power
New England seems predisposed to megacity ignorance, as I outline in a baby-viral thread. They eagerly ban pipelines that could help ease the cost of their electricity as well as reduce their risk of blackout. It doesn’t help that New York, which banned fracking and also eagerly prevents new pipeline projects, sits between New England and the Marcellus Shale. The result is that New England burns OIL, YES OIL!, for electricity.
As Angwin, a native of Vermont, recounts:
“AROUND 5:00 P.M. ON January 6, 2018 I snapped a light on as the sun went down. The temperature was around minus 8 degrees Fahrenheit. It had been zero at lunchtime and would be minus 15 the next morning. As usual, the light went on. As grid operator ISO New England had planned, oil had saved the grid. During that very cold week, about one-third of New England’s electricity came from burning oil. ”
So, because New England (and New York) refuses to allow pipelines, their grid operator (via The Winter Reliability Program) pays to store and burn oil for electricity. Oil produces 2.13 pounds of carbon dioxide (CO2) per kilowatt-hour (kWh) - that is marginally better than coal which produces 2.23 pounds CO2/kWh and far worse than natural gas which only produces 0.91 pounds CO2/kWh. As if that’s not enough, New England is purchasing its natural gas for $27 per thousand cubic feet (mcf) while EQT is selling gas in Appalachia for $7 per mcf. During winter storms, when demand soars, the differential is even worse.
“In the cold weather, the price for gas was soaring. The usual daily price for natural gas in this region is about $4 per MMBtu. On January 4, 2018 gas was $87 MMBtu. (MMBtu stands for 1 million British thermal units. One Btu is the amount of heat required to increase the temperature of one pound of water 1 degree Fahrenheit.) Electricity prices on the grid also ran very high. The usual grid prices of 2 cents to 8 cents per kilowatt-hour went up to 15 cents to 40 cents and stayed high for days. (A kilowatt-hour, or kWh, is the amount of electrical energy consumed when 1,000 watts are used for one hour.)”
It’s yet to be determined in New England citizens want these draconian laws or if they have simply remained in the dark regarding these complex issues.
The Fuel Storage Problem
Some of New England (and other RTO grids) problems of reliability are easily resolved too, if it weren’t for the Federal Energy Regulatory Commission (FERC).
“The national grid regulator, the Federal Energy Regulatory Commission, does not like the New England Winter Reliability Program because it does not like grid operators to pay directly for one type of fuel. Next year, there will be no such program. Instead, ISO-NE will implement an untested program of fines and rewards for power plants (known as Pay for Performance), aimed at keeping the plants online in bad weather. Since the grid itself will not change, I think the new program is unlikely to change the amount of oil used on the grid.”
Basically, FERC insists that RTOs (ISOs) be “fuel neutral". So anything that smacks of “buy this fuel” is not allowed. In essence, since wind can’t store the wind, solar can’t store the sun, and natural gas is not easily stored on-site, FERC says it would be unfair to incentivize oil, coal, and nuclear with on-site storage. As Angwin is revealing, this FERC policy is anti-reliability. Even with the oil stored by the grid operator under the Winter Reliability Program, New England nearly ran out.
An addition from yours truly:
Due to the Jones Act, a 1920 law which prohibits ships built and registered outside the U.S. from delivering goods between American ports, no United States LNG is allowed to come into New England from the Gulf Coast. There are no LNG carriers flying an American Flag. In fact, I believe there is only one ship in the world that flies the American flag. So, in order to get US LNG from Louisiana to New England, it requires first going to London and then from London to New England to get around the Jones Act. This results in Russian LNG being shipped to New England to help save the day. It also incentivizes oil shipments from less than desirable locations, too.
Over-Reliance Upon Natural Gas is Risky
Angwin makes a strong case that FERC needs to reverse its “fuel neutral” stance and instead directly incentivize on-site storage. Without this kind of incentive, we are at-risk of “just in time” natural gas delivery.
“Oil, coal, and nuclear plants are prepared for demand variations because they store fuel on-site. In contrast, gas plants are supplied by pipelines: They get the fuel when they need it — if the pipeline has it available. Using natural gas for electricity means that real-time electricity meets real-time pipelines. Everything has to happen right now. In some circumstances, it was clear that this would not end well. Homes use natural gas for heat, and homes have priority on the pipeline. In very cold weather, when homes need a lot of gas, power-plant gas supplies are interrupted.”
Prior to reading and appreciating this book, I held a particularly ignorant view about coal.
After reading this book, and becoming more informed about grid reliability and electricity generation, it’s apparent and obvious that we still need our coal plants. Coal was one of the central saviors of the Southwest Power Pool (SPP) during Winter Storm Uri (I’m from Oklahoma and part of the SPP, an RTO). Coal is easily stored and the coal plants are already built. Similar to the nuclear fuel crisis in France, and the energy crisis in Germany, we must not mothball our coal plants if we desire our lights to remain on. As mentioned already, in the post-RTO world we have gone from an overbuilt generation market to a market at-risk of not having enough generation to meet demand (hence warnings that MISO, CAISO, ERCOT, and even the SPP are at-risk of blackouts this coming winter).
““The power grid operator in the Central United States warned on Friday that problems it may experience keeping the lights on this summer could also occur during the summers of 2023, 2024 and beyond.” - MISO”
What I failed to appreciate was how hard it is to store natural gas. And since grids have to be balanced in milliseconds, and since wind and solar are reliably unreliable, we are compounding risk upon risk. Crossing our fingers that existing natural gas pipelines will deliver enough natural gas just in time, while residential customers take priority out of the pipeline (reducing gas supplies to the power plants), is not a strategy. It’s a failure to plan and will lead to senseless, unnecessary deaths.
“It is easy to dismiss New England’s problems as New England’s problems. But they are the direct result of overbuilding renewables, closing nuclear and coal plants, moving to natural gas to back up the renewables, and not building new gas pipelines. This is a scenario for grid fragility.”
Transmission and FERC Order 1000
There are more problems with wind and solar too. They are placed where there are not enough transmission lines exist to carry the power across the country to where grid demand exists. Enter FERC Order 1000.
After FERC 1000, the costs of public-policy transmission lines will be socialized between states. If a state wants a transmission line built, not for reliability as assessed by ISO-NE but for public policy, as defined by the state, then other states will pay most of the cost of that line. FERC left the rates to be determined by the various states.
In New England, the state that wants the line for policy reasons will pay 30% of the cost of the transmission line, while other states will share 70% of the costs. (Different RTOs can set their own rules for FERC 1000 socialization.)
If your New England state wants a transmission line to bring power from distant wind turbines to its city center, in the pre-FERC 1000 days, that would be something the ratepayers of that state would pay for. After FERC 1000, one state may decide on a policy, but all states will pay for it.
Federal policies can affect renewables. As noted in a previous section, the federal government, through FERC 1000, allows states to force their neighboring states to pay for the state-level policy choices. This is taxation without representation: the people in the neighboring states don’t get to elect the people who set the policy, but the people in the neighboring states have to pay for the policy.
And what should be expected from such policy? A dramatic increase in transmission costs.
“Transmission costs changed from 6% of total cost in 2008 to 24% in 2017.”
What We Have to Look Forward To?
For his important new book, A Question of Power: Electricity and the Wealth of Nations,230 Robert Bryce visited Beirut and spoke with people there. They referred to the electricity “brokers” as the “electricity Mafia.” They paid two electricity bills each month: one for about $35 to the state-owned power company, for the power they could provide, which was available about six hours a day. Then they pay around $100 a month to their local “mafia” generator. Bryce asked one man why he didn’t just buy his own generator, since he was paying his neighbor a significant amount of money. The answer was that, if he broke away from the local “mafia” generator, he might be killed. At the very least, the wire to his generator would be cut. Bryce reports how a clash between two generator-owners left two people dead and required the Lebanese army to end the violence.
Other Important Departing Highlights:
As I described in the chapter on the Balancing Authority, when the sun goes down and there is a lot of solar on the grid, other power plants must ramp up very quickly. This rapid-ramping “neck” of the duck curve is energy inefficient. Think of how much gas your car will burn if you speed away from a stoplight as if you were in a race, compared to how much it will burn if you are cruising down the highway at a steady clip. It’s the same with a gas turbine.
Malhotra calculates that providing 100 hours of backup for a single massive (1000 MW) coal plant would require 32,000 tons of lithium. In 2018, the global production of lithium was 62,000 tons.
Nickel-iron batteries use nickel and iron, which are not in tight supply. However, nickel-iron batteries need to be charged with about a third more electricity than they are able to deliver at discharge. In other words, while these batteries are not as resource intensive for the battery itself, they are resource intensive in terms of the power that they require. They lose charge at the rate of about 20% per month, whereas lithium batteries lose charge at 2% per month.
Warren Buffet on wind: I will do anything that is basically covered by the law to reduce Berkshire’s tax rate. For example, on wind energy, we get a tax credit if we built a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”
it isn’t a “market” if you can’t charge more if you take more risk.
some types of power plants get extra payments, which usually have nothing to do with the role of the plant on the grid. These payments are called “out-of-market” payments, and they are usually set by state policies.
PG&E eventually admitted that the [smart] meters they had installed in Bakersfield malfunctioned when they got too warm.
And there you have it. I am a great believer in taking personal responsibility, but I found her remarks discouraging. Too many people have the idea that their personal actions are paramount and that nothing else matters. It’s a kind of hubris: I will take these actions, and I will make the difference for climate. Well, no. Even if everybody in Germany decided to lower their electricity use, insulate their homes, use LED lights, and so forth, Germany would still miss its climate goals.
Jacobson did drop his lawsuit, which should be a happy ending, I suppose. However, many people, including myself, feel that the fact that Jacobson even brought a lawsuit has had a chilling effect on the whole renewable-energy debate. If scientists can’t debate each other in peer-reviewed journals without fear of lawsuits, science will not be able to move forward very well. There are two books directly refuting the Jacobson plan. Roadmap to Nowhere: The Myth of Powering the Nation With Renewable Energy by Mike Conley and Tim Maloney is available as a free PDF download on the web.
Finally:
Around 2015, Greenpeace decided to put their money where their mouth was and provided a poor village in the Bihar region of India with solar panels and battery backup. I believe the plan behind this Greenpeace experiment was to show that their stand against fossil-fuel usage was not the same as a plan to deny electricity to poor people. It didn’t quite work out the way Greenpeace wanted it to work out. After spending $400,000 on the installation, they invited the former Prime Minister of the state of Bihar for the inauguration of the system. He was greeted by villagers who had lined up to protest: “We want real electricity, not fake electricity!”
“Real” electricity comes from the grid, and the grid electricity in that part of India comes from coal. The first morning after the system was installed, the batteries were drained overnight. One young man had hoped to study in the early morning before he had to go to work in the fields. He discovered that his lights would not go on in the early morning. “We want real electricity!” People want the lights to go on. The title of Gayathri Vaidyanathan’s article in Scientific American says it all: “Coal Trumps Solar in India.” If wealthy people feel that they need to encourage very poor people not to use coal—well, those wealthy people are going to have a problem. I would recommend that they watch Hans Rosling’s wonderful video “The Magic Washing Machine,” about the different types of energy poverty.