Category — Electricity (General)
“Great are the powers of electricity,” commented a newspaper story in the late 19th century about the fascinating new energy source. “It makes millionaires. It paints devils’ tails in the air and floats placidly in the waters of the earth. It hides in the air. It creeps into every living thing.” (1)
Electricity is the most utilitarian of energies and the master form of the master resource, as explained below by leading experts and even some critics of energy. Just ask residential users, commercial establishments, or the manufacturing facilities if they want to pay more or less for power.
And so it was distressing to hear Barack Obama in a moment of ‘green’ candor declare that electricity prices would “skyrocket” under a cap-and-trade program to limit carbon dioxide (CO2) emissions. In his exact words and phrasing from November 2008:
You know, when I was asked earlier about the issue of coal, uh, you know — Under my plan of a cap and trade system, electricity rates would necessarily skyrocket. Even regardless of what I say about whether coal is good or bad. Because I’m capping greenhouse gases, coal power plants, you know, natural gas, you name it — whatever the plants were, whatever the industry was, uh, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.
The quotations follow.
“Next to the increasing importance of hydrocarbons as sources of energy, the rise of electricity is the most characteristic feature of the so-called second industrial revolution.”
- Erich Zimmermann, World Resources and Industries (New York: Harper & Brothers, 1951), p. 568. [Read more →]
May 26, 2011 2 Comments
[Note: This article has been updated to Twenty Bad Things about Windpower — go here.]
Trying to pin down the arguments of wind promoters is a bit like trying to grab a greased balloon. Just when you think you’ve got a handle on it, it squirts away. Let’s take a quick highlight review of how things have evolved.
1 – Wind energy was abandoned well over a hundred years ago, as it was totally inconsistent with our burgeoning more modern needs of power, even in the late 1800s. When we throw the switch, we expect that the lights will go on — 100% of the time. It’s not possible for wind energy, by itself, to ever do this, which is one of the main reasons it was relegated to the dust bin of antiquated technologies (along with such other inadequate sources like horse power).
2 – Fast forward to several years ago. With politicians being convinced by lobbyists that Anthropological Global Warming (AGW) was an imminent threat, a campaign was begun to favor all things that would purportedly reduce CO2. Wind energy was thus resurrected, as its marketers pushed the fact that wind turbines did not produce CO2 in their generation of electricity.
3 – Of course, just that by itself is not significant, so the original wind development lobbyists then made the case for a quantum leap: that by adding wind turbines to the grid we could significantly reduce CO2 from fossil fuel electrical sources (especially coal). This argument became the basis for many states’ implementing a Renewable Energy Standard (RES) — which mandated that their utilities use an increased amount of wind energy.
4 – Why was a mandate necessary? Simply because the real world reality of integrating wind energy made it a very expensive option. As such, no utility company would likely do this on their own. They had to be forced to. [Read more →]
September 20, 2010 36 Comments
In August 2009, the U.S. Nuclear Regulatory Commission (NRC) issued its fourth Early Site Permit for two new units at Southern Nuclear’s Vogtle site and its first for the Westinghouse AP1000 pressurized water reactor design. The two new units planned for Vogtle also became the reference plant for the AP1000 under NuStart in June 2009. This means Vogtle Units 3 and 4 will be the first licensed installations of the new AP1000 reactor design.
On February 16, President Obama announced that the DOE has offered Plant Vogtle terms for a loan guarantee that could provide up to 80% of the project estimated cost of $14.5 billion with the Southern Nuclear only paying a credit subsidy fee.
That’s a lot of commitment from taxpayers–$11.6 billion worth. Perhaps rapidly rising construction costs of new nuclear plants is partly why the owners want such large protection up front. But there are problems with fundamental economics comparing nuclear to the best foregone opportunity.
My back-of-the-envelope calculations comparing a natural gas-fired combined cycle plant to a new nuclear plant raise more questions than answers. For example, assume a utility has a baseload need of 2,400 MW in the future (like the new Vogtle units). Next, use the EIA future price projection of about 12 cents/kWh for nuclear and 8 cents/kWh for a gas-fired combined cycle produced electricity.
At today’s gas prices (yes, the prices have historically been extremely volatile), the combined cycle plant would use about $750 million a year of fuel. The 4 cents/kWh difference in busbar cost of generation is also equivalent to about $750 million per year in lower cost electricity generation. In essence, it’s an economic dead heat. However, the first cost of the no-risk gas combined-cycle plant is about a fifth of the nuclear plant, the latter which requires large government subsidies.
Simple math suggests that the gas-fired option should be back on the table. Moderate the fuel price risk with financial instruments with Grade A corporations. Obviously, there are major competitive problems with the nuclear plants to require such a large government subsidy–more explanation is invited in the comments by those in the know.
The Alvin W. Vogtle Electric Generation Plant (Plant Vogtle) is one of Georgia Power’s two nuclear facilities and one of three nuclear facilities in the Southern Company system (Figure 1). Southern Nuclear, a subsidiary of Southern Company since 1990, is the licensed operator of Plant Vogtle, which is located about 25 miles south of Augusta, Ga. The plant is jointly owned by Georgia Power (45.7%), Oglethorpe Power Corp. (30%), Municipal Electric Authority of Georgia (22.7%), and the Dalton Utilities (1.6%). [Read more →]
March 4, 2010 4 Comments
[Editor note: This excerpt from Bradley's next book, Edison to Enron: Energy Markets and Political Strategies, is part of a five-chapter history of Samuel Insull, the father of the modern power industry.]
President Obama just returned from Copenhagen empty handed. His hometown will not get the 2016 Olympics, or as a representative of the Natural Resources Defense Council’s (NRDC) Chicago operation advertised it, the “Blue Green Olympics.”
Given the science, economics, and politics of the global warming, aka climate change, it can be hoped that Obama–and the heads of all governments around the world–come away ‘empty handed’ in Copenhagen in December. No town, city, province, or country should be burdened with energy rationing when consumer-driven, conventional energy has become more sustainable, not less.
The real global issue is economic recovery and growth, which means expanded private property and enhanced market institutions to promote sustainable growth in place of abject poverty and economic underperformance.
Flash back to the 1893 Chicago World’s Fair. It introduced the world to the newest energy, electricity, soon to become the energy of energies. A new era of hope and progress was on display. Twenty million visitors had their lives changed by witnessing the results of the transformation of coal inputs into electric outputs. [Read more →]
October 5, 2009 1 Comment