President's rewards to green energy misplaced?
Posted By : Mark Byron Wooldridge
Obama, Romney Differ on Energy Policy - President Obama and Governor Romney agree that the U.S. is too dependent on foreign oil. But their views differ significantly on how to reduce or even end that dependence to make the country energy self-sufficient.
From what I have been reading on the costs of "green technologies" the costs of an installed wind turbine are now about $1,800 to $2,000 per kilowatt, not including the cost of long distance transmission. The installed cost of solar PV is running roughly $4,000 per kilowatt. The installed cost of combined cycle gas turbine facilities is about $1,000 to $1,100 per kilowatt. That does not tell the whole story though. Due to wind limitations, the achievable capacity factor of wind is 32% if land-based in a prime wind area. The achievable capacity factor of fixed solar PV is about 15% or so in the best areas and tracking PV achieves about 19 to 20%. Neither wind nor solar peak at the time of day coincident with the demand peak, although solar PV is a lot closer to it than wind. Thus, to meet the demand peak still requires fossil-fueled generating facilities--facilities that are frequently idle or spinning at low loads while wind is generating and solar PV is peaking. A CCGT plant has an achievable capacity factor of 96% or slightly more and an achievable efficiency of close to 55% (HHV) but no PTCs or cash in lieu grants. So, why would an investor build one if there are already (older, dirtier running and less efficient) fossil-fuel plants to provide backup that may even be already fully paid for? The answer is there is little investment in newer fossil-fueled power compared to renewables. The majority of these older, dirtier, and lower efficiency plants have efficiencies in the range of 36% down to 26% HHV. It is very arguable that the $90bn would have been better left in the hands of the investors to put into the newer fossil-fueled plants while more R&D was done on wind, solar PV and energy storage to get those costs down into a competitive range.
We may very well have reduced toxic emissions and CO2 emissions much more than renewables have contributed, particularly since the low cost of natural gas combined with the high efficiency of CCGT may have driven some coal-fired units into shutdown by dent of purely market forces rather than production tax credits and cash grants that not only cost the taxpayers money but also result in decreased federal tax revenues from corporate interests.
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