Thursday, May 26, 2011

CO2 Avoidance Costs With Wind Energy

An interesting article, primarily focused on Australia and wind's capability to reduce CO2 emissions, is followed by some interesting comments.

My thoughts on the commentary attached to the article:

I assume Australia will be an interesting Guinea Pig because, I assume, it would have littleconnection to adjacent grids, and most wind jurisdictions handle the variable output through increased exports.  One notable exception would be Texas, as ERCOT largely isolates itself for protectionist reasons, so I'd suggest Australians look to Texas for comparisons first.
If they do, they'll see the problems with Mr. Goggins's assumptions that many of us have spotted before.

The first is the coincidence is not causation issue, which is a matter of control groups.  The US EIA data shows dropping emissions, from electricity generation, and my amateur's review shows the states with over 1000MW of wind capacity performing worse than other states in reducing emissions.  Specific to the AWEA position, my review of IESO stats show CO2 reductions, between 2005 and 2009, of 6% in Colorado, 7% in Texas, and 11% in the entire country (

Mr. Goggins' argument that wind forces utilities to replace coal with gas is strange.   Aside from the fact that states without wind generation are doing better at reducing emissions than those with wind, there's also the issue that, at least in North America, natural gas is currently so cheap it is changing the industry all by itself, as demonstrated in this speech by the head of, if I recall correctly, the USA's largest private generation company:

The one article based on the experience in Denmark those in Australia probably should review is  - this references a broadly cited CEPOS study and a CEESA response to it.  From the conclusions of that report: "Based on these observations it could be said that Germany and Denmark together have solved the integration problems for about 7% wind energy, but only due to the common access to the regulation capabilities of the other Nordic countries, notably hydro power in Norway."

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