Sunday, April 24, 2016

David Keith on cheap solar - and other notable stories of the past week

I suspect this will be the hot energy post of the coming days.
An "only Nixon can go to China" moment could come from Keith's Cheap Solar Power: can now build systems in the world’s sunny locations and get very cheap power.  
What does this mean? 
Implication #1: In sunny places, solar will reshape commodity power markets.
  • Power prices will have a mid-day low. This is already happening in California, where it’s called the “duck curve.” It will soon be the norm in other high-sun demand centers, and the changing power price structure will shake utilities and industrial customers.
  • Wind suddenly looks less interesting. The capacity factors, global build rate, and costs for wind power have been nearly flat for five years.
  • Nuclear and CCS will have a harder time competing. For example, there are nuclear builds in the middle-east (e.g., UAE building Korean reactors), but with cheap solar it will be hard to compete against solar with gas backup.
  • Gas for load following and low-capex peaking looks ever more important. 
Implication #2: There will be opportunities to bring electrical demand to where power is cheap. 
One option is look for products that have very high energy cost and are easily transportable, and build solar farms and production together in high-insolation sites.
Four options are aluminum, ammonia, desalination, and transportation fuels.
Read the entire post at The Keith Group

Not sure northern, nighttime demand peak climates should rejoice over the implication power intensive industry should look for sunnier climates.

Other notables from the past week:

I wrote The many versions of 2014 Ontario Electricity Generation - which is mainly about data collection and reporting, but if you follow my work on Ontario's electricity sector and emissions, should be of interest. Of note, no solar is reported despite growing faster than any source in Ontario.

I also wrote The hidden continuity in Ontario Electricity Demand, which shows how unreported solar impacts perceived consumption patterns in Ontario.

Reuters reports Norway is looking at ending renewable subsidies within half a decade. Keith's article hints at one reason why: variable renewable energy sources (vRES) depressing the price of other generation - in Norway's case, hydro.

Swedish Vattenfall disposed of German lignite assets by paying a Czech firm to take them - as I understood the Reuters report.

France is still touted to go ahead with nuclear build in U.K.

Ontario's energy minister started the week calling the latest rate hike an "aberration" - it hoists up summer 2016 rates up from 2015's with the average annual increase over the past 8 years.
Ontario's energy minister ended the week citing an 11 year-old study, done for the government, incorrectly - again.
Ontario's Finance Minister didn't do much better, as I showed in The $113 bill "for Nothing"... That post quickly became the most viewed ever on my Wordpress site.

Finally, my main blog received a new post, 10700: Ontario's beastly number. I'd had big hopes for this post (and received some very nice comments on it), but it was one of those unpleasant writing experiences where my original intent to demonstrate the shortcomings of a target gave way to an understanding in the act of producing the work - that the target wouldn't be changed because it defined the government as green. Days later Ontario's Premier would demonstrate this in her too pious non-responses to questioning in the legislature - as I covered in This earth day, think on Wynne’s high electricity prices as stigmata.

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