Cost of Green Power Makes Projects Tougher Sell

[GliderGuider]

Cost of Green Power Makes Projects Tougher Sell

Michael Polsky’s wind farm company was doing so well in 2008 that banks were happy to lend millions for his effort to light up America with clean electricity.
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But two years later, Mr. Polsky has a product he is hard-pressed to sell.

His company, Invenergy, had a contract to sell power to a utility in Virginia, but state regulators rejected the deal, citing the recession and the lower prices of natural gas and other fossil fuels.

“The ratepayers of Virginia must be protected from costs for renewable energy that are unreasonably high,” the regulators said. Wind power would have increased the monthly bill of a typical residential customer by 0.2 percent.

Even as many politicians, environmentalists and consumers want renewable energy and reduced dependence on fossil fuels, a growing number of projects are being canceled or delayed because governments are unwilling to add even small amounts to consumers’ electricity bills.

A few things that occur to me from reading this:

This economic fear will hamper the build-out of all low-GHG sources of electricity, from wind and solar through tidal and geothermal to nuclear, simply because they are all more expensive than coal.

The distributed, low-volume nature of alt energy projects puts them at a major political and contractual disadvantage when dealing with large utility buyers. It's a lot easier to blow off a few small wind farms than one large corporate energy producer, especially when the coal is cheaper.

The reason fossil fuels are cheap is that the cost of waste disposal is being passed on to every inhabitant of the planet, human or not.

[ananda]

1. We live in a very sick society, corrupt through and through.

And as you said, the whole world is paying for it.

[GliderGuider]

3. We also live in a society of unimaginable wonders. That's the paradox of humanity.

There are moments when I feel intensely sad over all the negative things we are doing to each other and life on this planet.
And then there are the moments when I remember Mozart, Einstein and the Buddha.

Both aspects of humanity gain poignancy through the contrast. There are no one-sided coins in this world.

[OHdem10]

2. With millions having no jobs and those with jobs losing buying

power, this leaves smaller number customers up the economic
scale.

When the economy was in better shape half the country that
is 50% of the country earns less than 36,000 dollars annually.
A family of four living on 37K has a pretty tight budget.
Think of all those making under 36K.

[eleny]

4. There's the media doing it's job for the masters

[JDPriestly]

5. California voters just rejected a measure that would have put the

purchase and use of alternative energy on hold.

The population of California is about 36,961,664.

The population of the entire U.S. is about 306,406,893.

So Californians make up about 12% of the population of the U.S.

The population of Virginia is only about 7,882,590, maybe 2.5% of the U.S. population.

California is more than 4 times more populous than Virginia.

We need a national grid that distributes the cost of energy evenly across the states and communities.

Oil and coal can only be used for a certain length of time. People in less heavily populated areas may not notice the damage to the air quality, but when you live in a very densely populated area, you do.

Californians (and people in a few other states) are moving forward while the rest of the country is moving backward. Translate 12% and more of the country are moving forward, fearlessly forward. The rest of the country will catch up. It will just take a little time. It always does.

http://en.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_population

[azul]

6. Next thing you know, green will be the color of Muslins,

and God himself will get mixed-up regarding his creation of chlorophyll.

[txlibdem]

7. Wind power would have increased the monthly bill of a typical residential customer by 0.2 percent

OMG!!! 0.2 percent gets easily lost in the usual 3.6% regularly scheduled annual increase in electricity prices. This is a non-issue as far as costs are concerned. Look up the history of electricity rates. Numbers don't lie. Electricity rates have gone up by about 3.6% every year since time immemorial. This is a farce.

Here's a nice graph showing electrical rates back to 1973: (looks like about a 600% increase)
http://www.eia.gov/emeu/mer/pdf/pages/sec9_13.pdf

Here are the raw numbers:
http://www.eia.gov/emeu/mer/pdf/pages/sec9_14.pdf

Don't tell me that a 0.2 percent increase is in any way significant. Not buying it.

The real story is the success of entrenched interests using any and all excuses to block or delay renewable energy projects.

[oldhippie]

14. My electricity costs haven't gone up like that ...

"Numbers don't lie. Electricity rates have gone up by about 3.6% every year since time immemorial. This is a farce."

Not in my case they haven't. I live in Central Texas and get my elec from TXU. I have no special program, just the plain old run of the mill utility plan. I have kept records of my energy use for many years. I keep track of these things very closely to calculate paybacks and ROI of PV systems. Here is my average annual cost per KWHr for the past five years:

2006 $0.146 percent inc
2007 .131 - 3%
2008 .127 - 2%
2009 .130 + 2%
2010 (to date) .131 + 1%

It's hard to see your 3.6% annual increase there. It may be some national average, but national averages don't really affect most people. It is what it is in your local area.

[txlibdem]

15. Over time, it is a well known statistic that is not immune from temporary effects

But your rate did go up 1% in the last year so would you take up arms over an additional 0.2 percent if it meant getting more renewable energy?

[Kennah]

8. Fossil fuels are "cheap" because they are subsidized

The economics of energy aren't always easy to understand in one pass. Read "Lives Per Gallon" by Terry Tamminen. He is the former head of California EPA. IIRC the numbers from the book, we subsidize Big Oil both directly (upwards of about $100 billion a year) and indirectly (upwards of about $800 billion a year).

For all the talk from the tea infused Republican Party about market based solutions, they fucking lie through their teeth and are nothing more than shills for industries like Big Oil.

Coal also gets heavily subsidized, directly and indirectly.
http://www.sourcewatch.org/index.php?title=Federal_coal_subsidies

[kristopher]

9. still trying to promote nuclear by equating it with renewables, eh?

That dog won't hunt.

[GliderGuider]

10. Not equating it to renewables, that's impossible.

Nuclear power is a much more rational, effective choice. Renewables are like AA batteries - they do have a purpose, but only a fool would think they could run an industrial civilization on them.

[kristopher]

11. Yes you were equating nuclear to renewables

You wrote in the OP: "This economic fear will hamper the build-out of all low-GHG sources of electricity, from wind and solar through tidal and geothermal to nuclear, simply because they are all more expensive than coal."

There is no equivalency.

[GliderGuider]

12. In the sense that they're more expensive than coal? How could you object to a statement of fact?

Utility of course is different from expense. Any equivalency vanishes as soon as you bring utility into the picture. Nuclear power is enormously more useful to industrial civilization than wind.

[kristopher]

13. It is a bullshit equivalency - the costs of renewables are dropping while nuclear is rising

Wind shows the same cost slope as solar, only it is more advanced.