How renewable energy policies endanger power generation

April 23, 2013

Davis Swan writing at Energy Pulse points out the developing crisis in base electrical power generation that is caused by preferences for renewable energy sources.   Swan notes that “The reliability of the system depends upon a rather delicate balance of supply and demand that varies throughout the day and throughout the year.”  The economics of large scale base supply plants requires a predictable demand, which allows management to amortize building costs over a long period and maintain profitability.  Political policies which give increasing preference to renewable sources like wind and solar – which cannot provide base power because of their inconstancy – place that predictability at risk.  The result is that, as older base power plants go offline, fewer are being built to replace them, and a power crisis is inevitable.    Swan identifies some early warnings of a system in stress:

Beyond supply and reserve issues the economic disruption caused by renewables is producing some very strange consequences; in “green” Germany coal-fired plants are being used in preference to cleaner, more efficient gas-fired plants due to costs; in Ontario they are spilling water at “green and renewable” hydro dams in order to make room for “green and renewable” wind generation; the Danes end up using Swedish nuclear-generated electricity when the winds are calm even though they banned nuclear power generation; in Texas they are selling wind energy at negative prices almost 10% of the time because Production Tax Credits provide a profit.

Swan worries that the political push behind renewables is too strong, and resistance against them too weak and scattered, to forestall the looming crisis.  The system, he fears, must fail before we can be motivated to save it.

Read the whole thing.


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