When I was a regular reader of print newspapers back in the last century, I used to enjoy the pre-Murdock Wall Street Journal's editorial page. They would propose sometimes audacious, outrageous things. They would take crazy "conservative" positions. Sometimes I felt as if my blood would boil.
The New York Times editorials ... not so much.
A typical NY Times editorial would expound that education is good; crime is bad; that we all should volunteer more to help our communities. The NY Times editorial board would endorse proven, mainstream political candidates. Yawn.
So when an April 4, 2016 New York Times editorial announces that we are entering a "renewable energy boom", citing a written-by-committee consensus UN report , you know that renewables are no longer a "fringe" source of energy.
Indeed, as the editorial notes, a majority of the generation added last year GLOBALLY was in renewables, more than half of total new renewables investment last year occurred in China, India and Brazil -- the big developing markets that will make or break efforts to control greenhouse gas emissions -- and renewables, including hydro, share of global electricity production has doubled from 2007 to 2015, while costs are dropping like a rock. By 2020, solar PV will be cheaper in India than new coal-fired generation.
(In such an environment what investor in his or her right mind would commit to a new coal-fired plant?)
These facts are now commonplace. Governments and companies: ignore them at your peril.
P.S. If the UNEP (United Nations Environment Programme) is a bit suspect for the typical somewhat conservative U.S. senator or, say, Wall Street banker, how about Bloomberg?
Tuesday, April 5, 2016
Sunday, March 6, 2016
A visit to World Smart Energy Week in Tokyo
Friday afternoon I visited World Smart Energy Week at the Tokyo Big Sight exhibition hall. As in past recent years it is a huge event with hundreds (thousands?) of exhibition booths, and features solar, wind, biomass, fuel cells, battery technology, as well as an "energy market liberalization" exhibitions. My impressions from a few hours spent greeting former business partners and walking the halls.
1. Solar has not gone away in Japan. In 2015, Japan continued to be the #2 market for solar PV in the world, and I recently saw a prediction for another 8GW of new installations in 2016, retaining at least the #3 position. There is even SOME new greenfield development going on despite the difficulties of obtaining interconnection and the risk of curtailment. And the solar exhibition remains by far the largest and most well attended, with a mood even on the last afternoon of the exhibition not at all glum.
2. Solar PV technology just gets better and better, incrementally. What would have been a 245 or 250 watt module back in 2011, is now a 300 watt module. What would have been a 280 watt 72-cell module is now a 330 or 340 watt module, and it can be available as a bi-facial product so have actual output closer to that of a 400 watt mono-facial equivalent. There are a wide range of approaches -- Sunpower high efficiency modules, PERC modules, 5-busbar models (instead of the old 3-busbar). The First Solar "Tetrasun" module having 18~18.3% module efficiency is now on sale. Solo Power Japan is actually selling its flexible, light weight CIGS modules that were barely out of the lab (and having trouble being commercialized) in 2013.
All these things add up to a huge increase in output for the same project.
3. Microinverter manufacturers have been trying to get into Japan for years, without success. But at PV Japan I met one company, NEP, that is actually selling its product in Japan. They told me that they are approved for use in the utilities, and their product is going onto a 315kWp floating solar project in Fukuoka that will be done this month. This is a perfect solution to the issue of "where do we put the inverter" that inevitably comes up with floating solar projects in Japan -- the local authorities resist strongly any heavy equipment being located on the levy surrounding the pond.
4. Floating offshore wind experiments continue. The Fukushima national demonstration project is now nearing its next phase, with several different designs of floating offshore wind to be tested (including the Principle Power design as implemented by Mitsui Zosen). It will not happen overnight, it it is great to imagine a future in 15 or 20 years when Japan could get massive electricity from a flotilla of offshore wind farms.
5. Fuel Cells. The hydrogen car is for real. The Honda Clarity FCV will be available for sale from next week, joining Toyotas Mirai. Nissan will follow soon. Almost 75 hydrogen filling stations are in operation in Japan, with many more to follow. The combined heat and power Enefarm home fuel cells are slowly getting better. Lots of companies were exhibiting in this area. Kawasaki Heavy Industries had a nice pamphlet outlining all their activities related to this new business opportunity.
6. Basic energy conservation gets featured at WSEW in the Eco House and Eco Buildings exhibition. Glass wool insulation! Better reflective/insulating paint coatings! Some nice exhibits of companies taking the low cost way to lower CO2 output.
7. Electricity competition. There were lots of exhibits by competitive suppliers and providers of monitoring, price comparison tools and a myriad of other things needed in a competitive retail market. For the first time ever, I saw a TEPCO presence at one of these events, as TEPCO compares for competition in its own region and others.
1. Solar has not gone away in Japan. In 2015, Japan continued to be the #2 market for solar PV in the world, and I recently saw a prediction for another 8GW of new installations in 2016, retaining at least the #3 position. There is even SOME new greenfield development going on despite the difficulties of obtaining interconnection and the risk of curtailment. And the solar exhibition remains by far the largest and most well attended, with a mood even on the last afternoon of the exhibition not at all glum.
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| The Kyocera exhibit had a feature on "floating solar" power plants which focused on the 1.7MW "nishi-ike" project in Takaoka that we developed for them, as well as trumpeting their 13MW project now underway. |
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| DSM, a Netherlands-based speciality chemical company, makes coatings and films for module. |
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| A Solo Power module -- rollable and this one weighs 2.1kgs - 90 watts ... can be glued onto a rooftop. |
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| Solarworld bi-facial module. 72 cell 320 watt, but up to 400 watts production possible including reverse side, at a high albedo groundcover location. |
4. Floating offshore wind experiments continue. The Fukushima national demonstration project is now nearing its next phase, with several different designs of floating offshore wind to be tested (including the Principle Power design as implemented by Mitsui Zosen). It will not happen overnight, it it is great to imagine a future in 15 or 20 years when Japan could get massive electricity from a flotilla of offshore wind farms.
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| Nobody home at the USA Pavilion's Principle Power booth. Maybe they are over at the Fukushima offshore wind project displays? |
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| East Japan hydrogen fueling stations. |
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| West Japan hydrogen fueling stations |
6. Basic energy conservation gets featured at WSEW in the Eco House and Eco Buildings exhibition. Glass wool insulation! Better reflective/insulating paint coatings! Some nice exhibits of companies taking the low cost way to lower CO2 output.
7. Electricity competition. There were lots of exhibits by competitive suppliers and providers of monitoring, price comparison tools and a myriad of other things needed in a competitive retail market. For the first time ever, I saw a TEPCO presence at one of these events, as TEPCO compares for competition in its own region and others.
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| New logo! New TEPCO? Lots of reasons to think so, actually. |
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| Kinki Electric Power .... not to be confused with Kansai Electric Power. |
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| Skipping Stone (consultants) were there as well. |
Wednesday, January 27, 2016
How to keep everyone on the grid and get to 80% renewables by 2030
It is good to be back after a long absence from this blog.
My last post was about how a combination of solar + storage is likely to lead to massive "grid defection" over the coming 15 years.
Now, a study that suggests another way things MIGHT go.
A study published in the leading scientific journal Nature (and available online at the link) indicates that, for little or no net increase in the levelized cost of electricity, it would be possible to get the U.S.A. to 80% renewables by 2030. How? A significant investment in the transmission grid, including new very high capacity, low loss, long distance DC (direct current) transmission. The study looks at renewable generation and potential generation using detailed weather data, and concludes that even though sun and wind resources are intermittent and variable locally, across the U.S. as a whole the amount of electricity that can be generated by renewables at any one time is remarkably steady.
So, the authors suggest, the key is a grid that has sufficient capacity and resiliency to get the electricity from where it is produced at any time to where it would be consumed. A huge undertaking ... but one that costs no more than building and fueling the traditional generation the nation will need if this is not done.
Incredible.
My last post was about how a combination of solar + storage is likely to lead to massive "grid defection" over the coming 15 years.
Now, a study that suggests another way things MIGHT go.
A study published in the leading scientific journal Nature (and available online at the link) indicates that, for little or no net increase in the levelized cost of electricity, it would be possible to get the U.S.A. to 80% renewables by 2030. How? A significant investment in the transmission grid, including new very high capacity, low loss, long distance DC (direct current) transmission. The study looks at renewable generation and potential generation using detailed weather data, and concludes that even though sun and wind resources are intermittent and variable locally, across the U.S. as a whole the amount of electricity that can be generated by renewables at any one time is remarkably steady.
So, the authors suggest, the key is a grid that has sufficient capacity and resiliency to get the electricity from where it is produced at any time to where it would be consumed. A huge undertaking ... but one that costs no more than building and fueling the traditional generation the nation will need if this is not done.
Incredible.
Friday, April 10, 2015
Customers Will Leave the Grid Behind in Droves Over Next 10-15 Years
Rocky Mountain Institute has just published a fascinating study on the future of "grid load defection" in the U.S.A. under likely pricing scenarios. You can download it here:
http://blog.rmi.org/blog_2015_04_07_report_release_the_economics_of_load_defection
There is now significant concern in the U.S. -- and there SHOULD be significant concern in Japan -- about the likely failure of the traditional utility business model, as revenues decline once customers can self-generate electricity on an economic basis using solar PV and, eventually solar PV + battery storage.
One response is to charge customers a fixed amount for maintaining the grid, even if they reduce their consumption significantly based upon self-generation. RMI's study suggests that such approaches only prolong the inevitable. Over the next 10-15 years, almost everywhere in the U.S. a combination of solar PV + battery storage will become economically optimal, causing customers to purchase much less power and pushing down utility revenues.
The RMI study posits maximum potential customer defection in the Northeast U.S. at 50% of residential and 60% of commercial customers by 2030.
They highlight the need for new utility business models and new regulatory approaches to avoid this. Of course, the faster on-grid electricity prices rise ... the faster defection will occur. And the faster solar PV and storage costs decline ... well, you get the picture.
According to RMI, "although they could represent significant load loss, customers’ grid-connected solar-plus-battery systems can potentially provide benefits, services, and values back to the grid, especially if those value flows are monetized with new rate structures, business models, and regulatory frameworks."
But there is a major risk of a huge new group of centralized generation "stranded assets".
----------------
Now think about the situation in Japan where on grid power is much more expensive, and the cost is going up much more rapidly, and the current central planning process to decide on "energy mix" is giving a major role for new coal-fired generation and nuclear -- two generation sources that are not currently "economic" and so are just not being built in the U.S. ... and in many cases being mothballed. What is the likely result?
http://blog.rmi.org/blog_2015_04_07_report_release_the_economics_of_load_defection
There is now significant concern in the U.S. -- and there SHOULD be significant concern in Japan -- about the likely failure of the traditional utility business model, as revenues decline once customers can self-generate electricity on an economic basis using solar PV and, eventually solar PV + battery storage.
One response is to charge customers a fixed amount for maintaining the grid, even if they reduce their consumption significantly based upon self-generation. RMI's study suggests that such approaches only prolong the inevitable. Over the next 10-15 years, almost everywhere in the U.S. a combination of solar PV + battery storage will become economically optimal, causing customers to purchase much less power and pushing down utility revenues.
The RMI study posits maximum potential customer defection in the Northeast U.S. at 50% of residential and 60% of commercial customers by 2030.
They highlight the need for new utility business models and new regulatory approaches to avoid this. Of course, the faster on-grid electricity prices rise ... the faster defection will occur. And the faster solar PV and storage costs decline ... well, you get the picture.
According to RMI, "although they could represent significant load loss, customers’ grid-connected solar-plus-battery systems can potentially provide benefits, services, and values back to the grid, especially if those value flows are monetized with new rate structures, business models, and regulatory frameworks."
But there is a major risk of a huge new group of centralized generation "stranded assets".
----------------
Now think about the situation in Japan where on grid power is much more expensive, and the cost is going up much more rapidly, and the current central planning process to decide on "energy mix" is giving a major role for new coal-fired generation and nuclear -- two generation sources that are not currently "economic" and so are just not being built in the U.S. ... and in many cases being mothballed. What is the likely result?
Renewables in ... Texas
Japanese involved in the energy business and energy policy with whom I speak often marvel at the U.S. "shale gas revolution". They envy the U.S. access to cheap fossil fuels. Yes, natural gas is dirt cheap and the U.S. is now, again, the #1 oil producer in the world.
But they are much less aware that the fastest growing area of electric power generation in the U.S. is not gas, but renewables -- solar and wind. Well of course, they think, in someplace like California where liberals from Hollywood support a governor like Jerry Brown and drive aggressive renewables targets.
But wait, renewables in Texas -- the heart of the "oil patch"?
Indeed, Texas is the #1 producer of wind power in the U.S.A.
And this article in Scientific American highlights how solar PV is going to play a major role in Texas.
Austin, Texas plans almost 1GW of utility scale solar supply by 2025. And they plan to do it while maintaining affordability -- requiring lower than average utility bills and holding annual increases below 2% (the Kuroda BOJ inflation target, coincidentally).
Well, the article focuses on liberal Austin, Texas, home to University of Texas, Austin and the State Capital. But Austin is a city of almost one million population, and growing very rapidly. Austin's electric utility is at 25% renewable energy supply today and plans to be at 55% renewables by 2025.
It is indeed a Brave New World when a major city in the heart of the oil patch plans to be a 55% renewable electricity supply within ten years.
Meanwhile, Japan is building lots more coal plants and hopes to get to ... maybe 25% renewables by 2030? And they divide the world into "baseload" and "non-baseload"? Huh?
But they are much less aware that the fastest growing area of electric power generation in the U.S. is not gas, but renewables -- solar and wind. Well of course, they think, in someplace like California where liberals from Hollywood support a governor like Jerry Brown and drive aggressive renewables targets.
But wait, renewables in Texas -- the heart of the "oil patch"?
Indeed, Texas is the #1 producer of wind power in the U.S.A.
And this article in Scientific American highlights how solar PV is going to play a major role in Texas.
Austin, Texas plans almost 1GW of utility scale solar supply by 2025. And they plan to do it while maintaining affordability -- requiring lower than average utility bills and holding annual increases below 2% (the Kuroda BOJ inflation target, coincidentally).
Well, the article focuses on liberal Austin, Texas, home to University of Texas, Austin and the State Capital. But Austin is a city of almost one million population, and growing very rapidly. Austin's electric utility is at 25% renewable energy supply today and plans to be at 55% renewables by 2025.
It is indeed a Brave New World when a major city in the heart of the oil patch plans to be a 55% renewable electricity supply within ten years.
Meanwhile, Japan is building lots more coal plants and hopes to get to ... maybe 25% renewables by 2030? And they divide the world into "baseload" and "non-baseload"? Huh?
Thursday, February 5, 2015
Cheap Oil ... will not kill Solar
I just read an interesting short Bloomberg article about why solar PV will survive cheap oil prices. Of course, it is titled "Seven Reasons ... " I hate these list-like articles ... attempts to attract online readers who are accustomed to to bite-sized content, rather than serious analysis.
And, of course, the article has the obligatory cool chart. The same readers who want a "seven reasons" headline and a bullet point list also want charts!
But this chart I really do enjoy. A reprinted Bernstein research comparison of cost of solar and various fossil fuels, per mmbtu equivalent. Yes, solar is still more than Henry Hub gas. But look at that declining cost curve!
And, of course, the article has the obligatory cool chart. The same readers who want a "seven reasons" headline and a bullet point list also want charts!
But this chart I really do enjoy. A reprinted Bernstein research comparison of cost of solar and various fossil fuels, per mmbtu equivalent. Yes, solar is still more than Henry Hub gas. But look at that declining cost curve!
Thursday, January 8, 2015
Electricity Storage Makes Dramatic Advances
This morning (January 18 2015) the Nikkei carries an article highlighting a Sumitomo Denko announcement of their plan to cut the cost of energy storage to "1/10" of current levels. Sounds impressive.
Well ... not quite THAT impressive. The article focuses on Sumitomo Denko's "Redox Flux" batteries. Yes, these are one of several impressive battery technologies now being advanced globally. Sumitomo Denko's target is to cut cost to 20,000 to 30,000 yen per kWh, and to have a large scale product available commercially by 2020. The important points -- redox flow batteries do not have a limited number of cycles, so conceivably can last over a decade and be consistent with the life of a solar PV facility. This compares with Lithium Ion and NAS, which have limited cycle lifes. Also, Redox Flow is safer.
The article does not mention any of the other recent efforts OUTSIDE Japan involving redox flow (more specifically vanadium redox flow) that have been in the renewables trade press over the past year. I collected a few of these in recent months. These products are NOT in the 200,000-300,000 yen per kWh range. Rather, prices are already sliding toward the $500 per kWh range (around 60,000 yen at current exchange rates), and are likely to go lower fast.
So if Sumitomo Denko does not roll out its product until 2020, the main question is, will the market have already passed it by? Has the market already, today, passed it by?
Well ... not quite THAT impressive. The article focuses on Sumitomo Denko's "Redox Flux" batteries. Yes, these are one of several impressive battery technologies now being advanced globally. Sumitomo Denko's target is to cut cost to 20,000 to 30,000 yen per kWh, and to have a large scale product available commercially by 2020. The important points -- redox flow batteries do not have a limited number of cycles, so conceivably can last over a decade and be consistent with the life of a solar PV facility. This compares with Lithium Ion and NAS, which have limited cycle lifes. Also, Redox Flow is safer.
The article does not mention any of the other recent efforts OUTSIDE Japan involving redox flow (more specifically vanadium redox flow) that have been in the renewables trade press over the past year. I collected a few of these in recent months. These products are NOT in the 200,000-300,000 yen per kWh range. Rather, prices are already sliding toward the $500 per kWh range (around 60,000 yen at current exchange rates), and are likely to go lower fast.
So if Sumitomo Denko does not roll out its product until 2020, the main question is, will the market have already passed it by? Has the market already, today, passed it by?
CellCube model batteries: Gildemeister -- already available.
http://energy.gildemeister.
Unienergy -- currently $700 to $800 per kWh storage, when scale up will be around $500.
Imergy -- driving costs down from $500 toward $300 per kWh storage.
Eos Energy -- $160 per kWh storage product now taking orders for 2016 delivery!
http://cleantechnica.com/2015/01/29/eos-energy-storages-aurora-battery-system-commercially-available-2016-160kwh/
For a note on ViZn's Zinc Iron Redox Flow batteries, see Peter Detwiler's November 2014 Forbes Post:
http://www.forbes.com/sites/peterdetwiler/2014/11/21/vizns-zinc-iron-redox-flow-battery-another-storage-company-in-the-game/
And his 2014 year-end post on storage generally as one of the ten major themes of the past year:
http://www.forbes.com/sites/peterdetwiler/2015/01/07/2014-energy-story-2-storage-entered-the-game/
http://cleantechnica.com/2015/01/29/eos-energy-storages-aurora-battery-system-commercially-available-2016-160kwh/
For a note on ViZn's Zinc Iron Redox Flow batteries, see Peter Detwiler's November 2014 Forbes Post:
http://www.forbes.com/sites/peterdetwiler/2014/11/21/vizns-zinc-iron-redox-flow-battery-another-storage-company-in-the-game/
And his 2014 year-end post on storage generally as one of the ten major themes of the past year:
http://www.forbes.com/sites/peterdetwiler/2015/01/07/2014-energy-story-2-storage-entered-the-game/
Wednesday, December 24, 2014
U.S. Nuclear -- Shrinking of Natural Causes?
In Japan, there is a fierce debate below the surface over whether to attempt restart of nuclear power plants after they finish their initial 40-year license terms. Kansai Electric (KEPCO) is the Japanese utility most reliant on nuclear, traditionally, and it has recently announced an intention to seek a license extension for 2 plants that will soon reach the end of their initial 40 years.
What about in the U.S.? Well, not so long ago there was talk of a nuclear revival. New smaller, cheaper and safer plants would allow nuclear power to play a key role in helping the U.S. meet its greenhouse gas emission reduction targets. But the nuclear industry is shrinking again. Why?
Pure economics. The nuclear industry has a long history of cost overruns. The massive investments required place a huge financial lever on any hiccups or surprises, and these are very complex, complicated operations.
The New York Times reports that Vermont Yankee, a 42-year old plant, will shut down at the end of this year (next week). Vermont Yankee recently had its license extended until 2032 -- 60 years from start. And there is nothing "wrong" at the plant. There are not massive earthquakes, nor tsunami, in Vermont.
It simply cannot compete with cheap natural gas-fired electricity generation.
Will we ever get to the next generation of small, cheap nuclear reactors with lots of "passive safety" features that make them, literally, accident proof? Maybe. But the odds do not look so good in the near future, with oil and gas prices now lower globally than at any time since the short dip after the 2008 financial crisis, and the price drops being driven by factors that seem sustainable, at least over the next few years.
What about in the U.S.? Well, not so long ago there was talk of a nuclear revival. New smaller, cheaper and safer plants would allow nuclear power to play a key role in helping the U.S. meet its greenhouse gas emission reduction targets. But the nuclear industry is shrinking again. Why?
Pure economics. The nuclear industry has a long history of cost overruns. The massive investments required place a huge financial lever on any hiccups or surprises, and these are very complex, complicated operations.
The New York Times reports that Vermont Yankee, a 42-year old plant, will shut down at the end of this year (next week). Vermont Yankee recently had its license extended until 2032 -- 60 years from start. And there is nothing "wrong" at the plant. There are not massive earthquakes, nor tsunami, in Vermont.
It simply cannot compete with cheap natural gas-fired electricity generation.
Will we ever get to the next generation of small, cheap nuclear reactors with lots of "passive safety" features that make them, literally, accident proof? Maybe. But the odds do not look so good in the near future, with oil and gas prices now lower globally than at any time since the short dip after the 2008 financial crisis, and the price drops being driven by factors that seem sustainable, at least over the next few years.
E.On Spin Off -- An Important Crossroads
This month began with some exciting news for renewables in Germany.
E.On, one of the largest utilities in Europe, announced a corporate split. The company will divide into (1) traditional generation (coal, nuclear, natural gas), and (2) the rest of the company -- including renewables and both electric and gas distribution. E.On's announcement was lauded by investors and analysts. No doubt the investors are focused on E.On's 5.2 billion Euro of write-downs this year, mostly for the now "risky" generating assets, and are delighted to see a separation into a "good" business of stable, low risk cash flows and a "bad" business of risky, mostly fossil fuel generation.
Interestingly, it is the traditional generation business that is seen as extremely risky. As renewables cut into demand, who is to say whether a new coal plant will ever pay back its cost? As nuclear is regulated out of existence in Germany, it will become a pure decommissioning operation. E.On and other utilities say that their traditional business models no longer work.
How long before Japan gets to this point? Will the "internal" separations of generation and distribution businesses now being mapped out for Japan get anywhere close to this? ... when the businesses remain under holding companies? How long will these changes be held at bay?
Why are there plans being announced for massive investments into coal-fired generation in Japan? Yes, the economics are different in Japan than Europe, but as these plans go forward it will put enormous pressure on regulators over future decades to sustain traditional business models.
E.On, one of the largest utilities in Europe, announced a corporate split. The company will divide into (1) traditional generation (coal, nuclear, natural gas), and (2) the rest of the company -- including renewables and both electric and gas distribution. E.On's announcement was lauded by investors and analysts. No doubt the investors are focused on E.On's 5.2 billion Euro of write-downs this year, mostly for the now "risky" generating assets, and are delighted to see a separation into a "good" business of stable, low risk cash flows and a "bad" business of risky, mostly fossil fuel generation.
Interestingly, it is the traditional generation business that is seen as extremely risky. As renewables cut into demand, who is to say whether a new coal plant will ever pay back its cost? As nuclear is regulated out of existence in Germany, it will become a pure decommissioning operation. E.On and other utilities say that their traditional business models no longer work.
How long before Japan gets to this point? Will the "internal" separations of generation and distribution businesses now being mapped out for Japan get anywhere close to this? ... when the businesses remain under holding companies? How long will these changes be held at bay?
Why are there plans being announced for massive investments into coal-fired generation in Japan? Yes, the economics are different in Japan than Europe, but as these plans go forward it will put enormous pressure on regulators over future decades to sustain traditional business models.
Fukushima Decommissioning reaches important milestone
Over 3.5 years after the Fukushima accident, one of the most worrying problems has now been resolved, as TEPCO has completed removal of fuel rods from the pool in Reactor Building No. 4. These 1500 rods contained a far greater volume of nuclear material than the reactors themselves, and experts had cited a risk that, if the pool lost its water, the rods might melt or explode, spewing waste that would make the original accident look, well, rather small.
The decommissioning and related efforts will continue for decades (or even centuries), and lingering effects will need to be managed for millenia. But at least we can stop worrying that the next earthquake or typhoon will trigger this particular disaster.
Sunday, November 16, 2014
Future Japan Electricity Demand Will Decline -- the Komatsu Example (Manufacturing)
Komatsu is a great example of a Japanese company that plays on the world stage. In recent years over 80% of its sales are outside Japan. But it is still a Japanese company, and still makes many of its core products -- such as the engines that go in most of its machines -- within Japan. So it was subject to impact from high electricity costs and limited supply following the 2011 Fukushima accident and reactor shutdown. Indeed, it must be companies like this that are the reason Japan needs to restart its nuclear fleet and build new coal generation plants. It must be companies like this that are complaining about the high cost renewables, right?
Well, not exactly.
Komatsu is taking control of its own destiny, just as are many other large users.
In 2011, after the Fukushima accident, the then-President of Komatsu, Mr. Noji, set a goal for the company to reduce its electricity purchasing in Japan by 50% over 5 years. And the idea was not to do so by shuttering facilities and shifting production overseas -- an obvious big corporate reaction when faced with such a challenge. It also was NOT to conserve energy by "gaman" -- suffering through sweltering summer workplaces and freezing cold winter offices -- but if anything to improve comfort while conserving.
In March 2014, the company opened a renovated facility at its plant in Azawa, Ishikawa Prefecture. The plant's energy conservation features are shown at pages 29-33 of the current Komatsu English language annual report, downloadable here.
How much did the plant cut its electricity purchases as compared with the prior facility?
90%. That is right, NINETY PERCENT. Not 9% or 19%. 90%.
This was done by a combination of
(1) building and production facility design and layout improvements,
(2) better (insulating) building materials,
(3) cooling via ground water circulation,
(4) more efficient machinery (including recapture of energy in the same way that some autos now include regenerative braking),
(4) waste heat recovery, and
(5) a new, adjacent biomass plant that generates 40% of the facility's power needs.
Of course, Item (5) is not a conservation method, just distributed generation. But it does shift the demand away from the utilities and big generation. And it helps create a market for local forestry resources.
I heard Mr. Noji, now the Chairman of Komatsu, speak about this at an event last week. A senior executive from Toshiba spoke up soon after, noting that Toshiba semiconductor fabs consume a huge amount of electricity, and that Toshiba had managed to cut use "only" 36% at its new major domestic fab.
These major Japanese corporations compete globally. They will find a way. And that way will NOT pay a huge markup over the costs their competitors face for power generated by the utilities in Japan.
If Japan's corporate sector can do this, who will buy the extra electricity generated once new coal plants are built and nuclear plants are restarted?
Now if only Japan would capture the "low hanging fruit" in its residential and commercial building sector -- higher standards (and consumer incentives) for insulation and double/triple glazed windows, for example.
According to the June 2014 BP Statistical Review of World Energy, Japan's primary energy consumption fell from 531.4 million tonnes of oil equivalent in 2005 to 474 million tonnes of oil equivalent in 2013. Down 11% over 8 years. Given demographic trends, and actions of the corporate sector, the smart money would be on further future declines in consumption.
(Note: Large manufacturing facilities are already subject to exemption from the FIT surcharge. So this energy conservation drive is not part of some effort to avoid the costs of solar and its FIT surcharges).
Well, not exactly.
Komatsu is taking control of its own destiny, just as are many other large users.
In 2011, after the Fukushima accident, the then-President of Komatsu, Mr. Noji, set a goal for the company to reduce its electricity purchasing in Japan by 50% over 5 years. And the idea was not to do so by shuttering facilities and shifting production overseas -- an obvious big corporate reaction when faced with such a challenge. It also was NOT to conserve energy by "gaman" -- suffering through sweltering summer workplaces and freezing cold winter offices -- but if anything to improve comfort while conserving.
In March 2014, the company opened a renovated facility at its plant in Azawa, Ishikawa Prefecture. The plant's energy conservation features are shown at pages 29-33 of the current Komatsu English language annual report, downloadable here.
How much did the plant cut its electricity purchases as compared with the prior facility?
90%. That is right, NINETY PERCENT. Not 9% or 19%. 90%.
This was done by a combination of
(1) building and production facility design and layout improvements,
(2) better (insulating) building materials,
(3) cooling via ground water circulation,
(4) more efficient machinery (including recapture of energy in the same way that some autos now include regenerative braking),
(4) waste heat recovery, and
(5) a new, adjacent biomass plant that generates 40% of the facility's power needs.
Of course, Item (5) is not a conservation method, just distributed generation. But it does shift the demand away from the utilities and big generation. And it helps create a market for local forestry resources.
I heard Mr. Noji, now the Chairman of Komatsu, speak about this at an event last week. A senior executive from Toshiba spoke up soon after, noting that Toshiba semiconductor fabs consume a huge amount of electricity, and that Toshiba had managed to cut use "only" 36% at its new major domestic fab.
These major Japanese corporations compete globally. They will find a way. And that way will NOT pay a huge markup over the costs their competitors face for power generated by the utilities in Japan.
If Japan's corporate sector can do this, who will buy the extra electricity generated once new coal plants are built and nuclear plants are restarted?
Now if only Japan would capture the "low hanging fruit" in its residential and commercial building sector -- higher standards (and consumer incentives) for insulation and double/triple glazed windows, for example.
According to the June 2014 BP Statistical Review of World Energy, Japan's primary energy consumption fell from 531.4 million tonnes of oil equivalent in 2005 to 474 million tonnes of oil equivalent in 2013. Down 11% over 8 years. Given demographic trends, and actions of the corporate sector, the smart money would be on further future declines in consumption.
(Note: Large manufacturing facilities are already subject to exemption from the FIT surcharge. So this energy conservation drive is not part of some effort to avoid the costs of solar and its FIT surcharges).
Friday, November 14, 2014
Final Nuclear Storage -- U.S. and Japanese Switch Policy Approaches
One of the long standing questions with nuclear power generation is -- where will the waste be stored for the tens of hundreds of thousands of years until it becomes harmless?
This policy issue has both a technical and a political aspect.
USA OLD POLICY. In the U.S., the long-preferred site was Yucca Mountain, Nevada, where the geological features apparently give an excellent prospect for the required very-long-term stability. The Federal government long ago began promoting the site for these reasons, as reflected in many U.S. policies. Unfortunately, the State of Nevada and its residents were not asked first, and they have not been particularly welcoming. And then the senior Senator from Nevada, Harry Reid, became Senate Majority Leader, and following the election of President Obama in 2008 he obtained the appointment of one of his Nevada proteges as head of the U.S. Nuclear Regulatory Commission. All this was not so positive for the idea of using Yucca Mountain as a permanent waste depository. Another decade or more of delay and back to the drawing board.
JAPAN OLD POLICY. In Japan, the government also has been looking for a permanent waste depository. (Actually, not permanent, assuming human beings are still around in the very, very distant future. Just very, very long term). In Japan, the approach to siting nuclear projects has typically involved more carrots than sticks. So the Japanese government long followed a strategy of waiting for someplace to "raise its hand" and volunteer to serve as a waste disposal. After all, the waste will be buried so deep that no one will need to worry about it for hundreds or thousands of years. But no community in Japan has raised its hand.
USA NEW POLICY. In the U.S., the government realized its mistake in trying to force Nevada to accept Yucca Mountain, and inspiring the mobilization of a vocal and effective opposition. So the U.S. is now switching to a policy of looking for someplace to "raise its hand" -- someplace that wants the investment, jobs, stability and "carrots" that will come with this role.
JAPAN NEW POLICY. In Japan, the government realized that if it kept waiting for a community to "raise its hand", this might never happen. The lack of a final waste depository hurts the nuclear restart campaign, so the government will now go ahead and study the question from a technical/geological perspective, and try to identify the best site or sites for the depository based on technical grounds.
So Japan has pretty much adopted the former U.S. approach.
And the U.S. has pretty much adopted the former Japanese approach.
And despite this issue floating around (at least in the U.S.) for the past 40 years or more ... it is still not resolved. The problem is not, primarily, technical, though the technological questions are complex. It is a political challenge. Can a representative democracy actually do this? When? And what will it take to get it done?
This policy issue has both a technical and a political aspect.
USA OLD POLICY. In the U.S., the long-preferred site was Yucca Mountain, Nevada, where the geological features apparently give an excellent prospect for the required very-long-term stability. The Federal government long ago began promoting the site for these reasons, as reflected in many U.S. policies. Unfortunately, the State of Nevada and its residents were not asked first, and they have not been particularly welcoming. And then the senior Senator from Nevada, Harry Reid, became Senate Majority Leader, and following the election of President Obama in 2008 he obtained the appointment of one of his Nevada proteges as head of the U.S. Nuclear Regulatory Commission. All this was not so positive for the idea of using Yucca Mountain as a permanent waste depository. Another decade or more of delay and back to the drawing board.
 |
| Yucca Mountain -- The Outside |
USA NEW POLICY. In the U.S., the government realized its mistake in trying to force Nevada to accept Yucca Mountain, and inspiring the mobilization of a vocal and effective opposition. So the U.S. is now switching to a policy of looking for someplace to "raise its hand" -- someplace that wants the investment, jobs, stability and "carrots" that will come with this role.
 |
| Yucca Mountain -- The Inside |
So Japan has pretty much adopted the former U.S. approach.
And the U.S. has pretty much adopted the former Japanese approach.
And despite this issue floating around (at least in the U.S.) for the past 40 years or more ... it is still not resolved. The problem is not, primarily, technical, though the technological questions are complex. It is a political challenge. Can a representative democracy actually do this? When? And what will it take to get it done?
Tuesday, November 11, 2014
Stop the Bullying, Please!
Japanese media from time to time turns its focus inward and looks at the phenomenon of "ijime" in Japanese society. Ijime is usually translated as "bullying" and most commonly thought of as a middle/high school phenomenon. Sometimes a more granular approach identifies types of "harassment" such as "power harassment" (boss to subordinate) or "pregnancy harassment" (company to female employee) in the workplace, or bullying/hazing type tactics by athletic team coaches. I guess this type of thing, common in almost any society in some or another form, comes with the territory in a society like Japan that is full of hierarchical/vertical relationships.
Last week, I was talking with a prominent Japanese lawyer who handles many project financings, including solar power projects. He asked me (in Japanese) "why is the Nikkei Shimbun bullying solar power developers"?
Indeed, the past year there has been a massive campaign in the Nikkei and some other outlets (Yomiuri, and presumably also Sankei commentators and other more conservative outlets I do not usually read), to demonize solar power. It is clearly driven by the utilities, their supporters in the LDP and the government and industry, and it is transparent. I have not commented before, but it struck me that this lawyer had it right. What is going on a type of "ijime" or bullying.
Solar PV is never mentioned in the Nikkei or Yomiuri without the adjectives "expensive, unreliable". Okay, to be completely fair, maybe they substitute "unstable" or "intermittent" for "unreliable" but always include "expensive." And the media continues to repeat, ad nauseum, the allegation by someone (never named) that developers are "sitting on" approvals waiting for module prices to go down before building projects -- in fact, as the yen has plunged (again down more than 5% the past few weeks), module prices have increased in local currency terms and as a percentage of project income.
Recently there was an article in Nikkei about the relevant METI study committee wanting to reform the system to prevent 不当利益 -- illicit profits. There was another one about how METI wants to block sellers of retail power from marketing to consumers as "100% green" or "all renewable" when their generation is sold (with subsidies) under the FIT. Of course, if it turned out consumers all want, and are willing to pay more for, "all renewable" power, then that would not be a good result for the existing utility industry or other suppliers.
This whole campaign reached its low point, for me, in a large article on page 2 of the Nov 4, 2014 Nikkei entitled 「蹉跌再生エネルギー」("Failure of Renewable Energy, Part 1") -- apparently the first in a series.
The large headline, in the middle of the page, was 「国民に6.5兆円の請求書」, which translates roughtly as a "6.5 trillion yen bill for the Japanese people!" That is over $50 billion a year. Except the headline was more like this:
「国民に6.5兆円の請求書」
A business newspaper, Nikkei is not known for inflammatory headlines. I do not see in Nikkei a similar headline about the "20, 30 or 40 trillion yen bill for the Japanese people!" from the Fukushima accident and related cleanup, decommissioning and retrofitting of nuclear reactors. How much is Japan's total cost of electricity in a year?
Nor does Nikkei "call a spade a spade" when one of the utilities refuses to decommission a reactor that has a less than 1% chance it will ever reopen ... just to keep the asset on a balance sheet and avoid, or at least delay, potential insolvency. And when METI and other regulators get together to change the electricity ratebase accounting calculations so that operators can recover costs from their ratepayers and amortize even non-functioning or prematurely decommissioned reactors, I see only a polite article discussing the idea, not really anything to indicate the painful numbers involved -- a trillion yen? 10 trillion yen?, and certainly not in 30 point typeface.
How did the Nikkei writer arrive at the 6.5 trillion yen figure? What is the basis? The Nikkei article does not say.
It is actually very difficult to know the cost of the FIT, as compared to an alternate world where the FIT had not been adopted. This is even more so in a country where there are not transparent, liquid markets in electric power. In Germany, solar looks expensive, but it actually pushes WAY down the cost of wholesale power during peak periods (daytime). If a user gets cheaper power, but pays a bit renewable surcharge, the user is no better or worse off economically than before, but solar looks "expensive", and the competing coal generator is extremely unhappy at the low prices it gets for its output.
But in Japan, one key assumption is how much of the approximately 70GW of "METI certified" solar projects will actually be built.
METI produced some materials for the committee now considering the future of the FIT on this very subject, dated September 30, 2014. You can find them here. (Materials #8).
What the METI submission to the committee says is that the annual "surcharge" amount for the projects operating under the FIT as of June 30 2014 is around 650 billion yen, or just under US$600 million. The anticipated figure if ALL METI-certified projects were to start operations? Around 4 times that amount, or 2.7 trillion yen per year. But of course, the very same METI chart warns that THIS WILL NOT HAPPEN. METI realizes that no one expects this, as projects will NOT go forward for any number of reasons, some of which are listed in the chart.
In fact, Japan implemented 7GW of solar in 2013, will implement around 10GW in 2014. My guess is that there will be similar numbers next year and perhaps a bit less in 2016 (to the extent we can know). These will be a mix of 40-yen, 36-yen and 32-yen approved projects. The total that will be built from the 69GW that has been certified? Probably around half, or less. The short term economic burden on consumers will be real (as compared with coal or even gas-fired generation), but very manageable. A few hundred yen per month for the average consumer ... much of whose bill is going to pay the cost of other, opaque mistakes and errors by the suppliers over past decades. And many of these facilities will continue to produce electricity, selling at and pushing down market rates, for 5, 10 or even 15 years after the FIT purchase obligation ends.
But this is a very scary world for the utilities. Each GW of solar means a loss of peak electric sales for them, and more trouble justifying their existing generation expansion plans. Each household that implements solar with storage in the future ... means a permanent lost customer. They will either embrace these changes and preserve an interesting, if very different, business, or will go the way of the dinosaurs.
When I first started to work on solar PV projects in Japan, I can remember several meetings with a major Japanese institution when I would explain what we were trying to do -- bring the best of the world's experience to Japan and accelerate implementation of solar PV here, including the Moore's Law-like cost reductions seen elsewhere in the world. The counterparties would warmly thank us for our efforts to develop such a business to help expand renewables in Japan.
That was before the change in government, and the utilities realizing that solar PV and other renewables under the feed-in tariff is an existential threat to their business models. That was before the nuclear restart fell 12-18 months behind its initial schedule. Indeed, now as Japan heads into its winter peak electricity use period having survived a second consecutive zero nuclear power summer, and with no specific government conservation targets for large users, AND as oil and gas prices plunge to their lowest levels in many years, the utilities and government might be worried about people starting to ask questions such as "is there really a crisis that requires the nuclear restart?"
Do we really need new large coal-fired plants ... or won't we have access in the future to cheaper LNG? Shouldn't we plan future electric capacity based upon the "Moore's Law" characteristics of technology-driven renewables like solar and storage?
Last week, I was talking with a prominent Japanese lawyer who handles many project financings, including solar power projects. He asked me (in Japanese) "why is the Nikkei Shimbun bullying solar power developers"?
Indeed, the past year there has been a massive campaign in the Nikkei and some other outlets (Yomiuri, and presumably also Sankei commentators and other more conservative outlets I do not usually read), to demonize solar power. It is clearly driven by the utilities, their supporters in the LDP and the government and industry, and it is transparent. I have not commented before, but it struck me that this lawyer had it right. What is going on a type of "ijime" or bullying.
 |
| Upon passage of the FIT legislation in August 2011 - happy faces on Kan and Son. |
Recently there was an article in Nikkei about the relevant METI study committee wanting to reform the system to prevent 不当利益 -- illicit profits. There was another one about how METI wants to block sellers of retail power from marketing to consumers as "100% green" or "all renewable" when their generation is sold (with subsidies) under the FIT. Of course, if it turned out consumers all want, and are willing to pay more for, "all renewable" power, then that would not be a good result for the existing utility industry or other suppliers.
This whole campaign reached its low point, for me, in a large article on page 2 of the Nov 4, 2014 Nikkei entitled 「蹉跌再生エネルギー」("Failure of Renewable Energy, Part 1") -- apparently the first in a series.
The large headline, in the middle of the page, was 「国民に6.5兆円の請求書」, which translates roughtly as a "6.5 trillion yen bill for the Japanese people!" That is over $50 billion a year. Except the headline was more like this:
「国民に6.5兆円の請求書」
A business newspaper, Nikkei is not known for inflammatory headlines. I do not see in Nikkei a similar headline about the "20, 30 or 40 trillion yen bill for the Japanese people!" from the Fukushima accident and related cleanup, decommissioning and retrofitting of nuclear reactors. How much is Japan's total cost of electricity in a year?
Nor does Nikkei "call a spade a spade" when one of the utilities refuses to decommission a reactor that has a less than 1% chance it will ever reopen ... just to keep the asset on a balance sheet and avoid, or at least delay, potential insolvency. And when METI and other regulators get together to change the electricity ratebase accounting calculations so that operators can recover costs from their ratepayers and amortize even non-functioning or prematurely decommissioned reactors, I see only a polite article discussing the idea, not really anything to indicate the painful numbers involved -- a trillion yen? 10 trillion yen?, and certainly not in 30 point typeface.
How did the Nikkei writer arrive at the 6.5 trillion yen figure? What is the basis? The Nikkei article does not say.
It is actually very difficult to know the cost of the FIT, as compared to an alternate world where the FIT had not been adopted. This is even more so in a country where there are not transparent, liquid markets in electric power. In Germany, solar looks expensive, but it actually pushes WAY down the cost of wholesale power during peak periods (daytime). If a user gets cheaper power, but pays a bit renewable surcharge, the user is no better or worse off economically than before, but solar looks "expensive", and the competing coal generator is extremely unhappy at the low prices it gets for its output.
But in Japan, one key assumption is how much of the approximately 70GW of "METI certified" solar projects will actually be built.
METI produced some materials for the committee now considering the future of the FIT on this very subject, dated September 30, 2014. You can find them here. (Materials #8).
What the METI submission to the committee says is that the annual "surcharge" amount for the projects operating under the FIT as of June 30 2014 is around 650 billion yen, or just under US$600 million. The anticipated figure if ALL METI-certified projects were to start operations? Around 4 times that amount, or 2.7 trillion yen per year. But of course, the very same METI chart warns that THIS WILL NOT HAPPEN. METI realizes that no one expects this, as projects will NOT go forward for any number of reasons, some of which are listed in the chart.
In fact, Japan implemented 7GW of solar in 2013, will implement around 10GW in 2014. My guess is that there will be similar numbers next year and perhaps a bit less in 2016 (to the extent we can know). These will be a mix of 40-yen, 36-yen and 32-yen approved projects. The total that will be built from the 69GW that has been certified? Probably around half, or less. The short term economic burden on consumers will be real (as compared with coal or even gas-fired generation), but very manageable. A few hundred yen per month for the average consumer ... much of whose bill is going to pay the cost of other, opaque mistakes and errors by the suppliers over past decades. And many of these facilities will continue to produce electricity, selling at and pushing down market rates, for 5, 10 or even 15 years after the FIT purchase obligation ends.
But this is a very scary world for the utilities. Each GW of solar means a loss of peak electric sales for them, and more trouble justifying their existing generation expansion plans. Each household that implements solar with storage in the future ... means a permanent lost customer. They will either embrace these changes and preserve an interesting, if very different, business, or will go the way of the dinosaurs.
When I first started to work on solar PV projects in Japan, I can remember several meetings with a major Japanese institution when I would explain what we were trying to do -- bring the best of the world's experience to Japan and accelerate implementation of solar PV here, including the Moore's Law-like cost reductions seen elsewhere in the world. The counterparties would warmly thank us for our efforts to develop such a business to help expand renewables in Japan.
That was before the change in government, and the utilities realizing that solar PV and other renewables under the feed-in tariff is an existential threat to their business models. That was before the nuclear restart fell 12-18 months behind its initial schedule. Indeed, now as Japan heads into its winter peak electricity use period having survived a second consecutive zero nuclear power summer, and with no specific government conservation targets for large users, AND as oil and gas prices plunge to their lowest levels in many years, the utilities and government might be worried about people starting to ask questions such as "is there really a crisis that requires the nuclear restart?"
Do we really need new large coal-fired plants ... or won't we have access in the future to cheaper LNG? Shouldn't we plan future electric capacity based upon the "Moore's Law" characteristics of technology-driven renewables like solar and storage?
Friday, November 7, 2014
Floating LNG
One of the main challenges of LNG has been the massive related infrastructure. First, you need a natural gas field that can deliver enough gas to justify building pipelines, ports, liquefaction and storage facilities, etc., etc. These projects cost not billions of dollars, but tens of billions of dollars "all in".
Shell's Prelude LNG facility, whose hull launched in 2013, will weigh five times as much as a U.S. nuclear-powered aircraft carrier when in operation, and be almost 500 meters long. The cost? Guesstimated to be over US$10 billion.
JGC and Samsung Heavy Industries have been selected to build another floating plant, for Petronas, (the national oil company of Malaysia).
What if you could do the liquefaction on a ship? Then you could locate the ship near an offshore LNG field, load the cargoes directly onto LNG tankers, and when the gas field is tapped out, move the plant.
I attended part of METI's annual LNG Producer-Consumer Conference yesterday, November 6, 2014. In the "new technology" panel, I was expecting a lot of discussion about gas-powered fuel cell generators, compressed gas vehicles, etc. The head of Tokyo Gas did discuss these things, at a very high level, but others focused on upstream developments. Someone from Anadarko just talked up their Mozambique project -- a sale pitch and not much about technology. The President of Chiyoda gave a general corporate presentation on their track record in LNG.
But representatives of both Shell and JGC did at least spend most of their presentations on new technology -- in this case, floating LNG.
But representatives of both Shell and JGC did at least spend most of their presentations on new technology -- in this case, floating LNG.
 |
| An image of Shell's floating LNG concept |
 |
| The hull of its first FLNG, launched and in the water. |
These facilities could significantly reduce the cost of opening up new gas fields for LNG shipment, and could allow LNG to flow from fields that otherwise would not justify the investment for pipelines and an onshore plant ... Of course, this will increase already intense competition among producers for support from major LNG consumers in Japan, Korea, China and India.
Of course, just as with Enron's infamous barge-mounted power plants (infamous because they were the assets involved in a dodgy asset sale/buy back at the end of a financial year that resulted in several investment bankers going off to prison, if memory serves), a floating LNG liquefaction plant also helps with political risk. In case of war or threat of expropriation ...just sail away and moor at some other gas field.
Tuesday, November 4, 2014
The (Near) Future of Solar -- Part 3
Module prices will continue to drop rapidly in coming years. A few examples:
1. Sun Edison announcement in October of a $0.40 per watt cost 400 watt module from 2016. See report of the announcement here.
2. 1366 technologies' kerfless wafer promises more than 50% reduction in wafer costs for polysilicon modules, or overall 20% module cost reduction. Scaling now to 250MW production facility. See reports here and here.
3. Martin Green, the "father of solar" in Australia, conservatively estimates that the cost of producing modules will fall by at least 50% over the next decade, reaching less than 30 cents per watt before 2025 ... a price at which coal (+ sequestration OR recapture OR carbon tax), nuclear and other sources will not be able to compete. If he is talking in Australia cents (not clear, but likely), then that would be around US$0.26 per watt. ...
4. And it is widely reported that even today large, utility scale solar has a lower levelized cost of energy (LCOE) in many places now for new installations than competing fossil fuels.
5. Now this -- residential solar plus storage is now competitive in Australia among other places.
6. And next this -- an industry report indicates that even in that rain-swept island of Great Britain, the levelized cost of energy (LCOE) of large scale solar should fall below that of LNG around 2020. The LCOE will fall 30% from 2014 to 2020. Of course, this number -- LCOE -- is the overall cost of providing a kWh, and is not limited to cells/modules, the true the "Moore's Law" components of solar. As the report notes, solar has a history of beating these kinds of predictions ... unlike some other forms of energy.
1. Sun Edison announcement in October of a $0.40 per watt cost 400 watt module from 2016. See report of the announcement here.
2. 1366 technologies' kerfless wafer promises more than 50% reduction in wafer costs for polysilicon modules, or overall 20% module cost reduction. Scaling now to 250MW production facility. See reports here and here.
3. Martin Green, the "father of solar" in Australia, conservatively estimates that the cost of producing modules will fall by at least 50% over the next decade, reaching less than 30 cents per watt before 2025 ... a price at which coal (+ sequestration OR recapture OR carbon tax), nuclear and other sources will not be able to compete. If he is talking in Australia cents (not clear, but likely), then that would be around US$0.26 per watt. ...
4. And it is widely reported that even today large, utility scale solar has a lower levelized cost of energy (LCOE) in many places now for new installations than competing fossil fuels.
5. Now this -- residential solar plus storage is now competitive in Australia among other places.
6. And next this -- an industry report indicates that even in that rain-swept island of Great Britain, the levelized cost of energy (LCOE) of large scale solar should fall below that of LNG around 2020. The LCOE will fall 30% from 2014 to 2020. Of course, this number -- LCOE -- is the overall cost of providing a kWh, and is not limited to cells/modules, the true the "Moore's Law" components of solar. As the report notes, solar has a history of beating these kinds of predictions ... unlike some other forms of energy.
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