Global warming, climate change, all these things are just a dream come true for politicians. I deal with evidence and not with frightening computer models because the seeker after truth does not put his faith in any consensus. The road to the truth is long and hard, but this is the road we must follow. People who describe the unprecedented comfort and ease of modern life as a climate disaster, in my opinion have no idea what a real problem is.
Advocates of Net Zero policies repeatedly reassure the public that they are advancing cheap, green energy with the promise of vast numbers of lucrative green jobs and world leadership for the U.K. in selected green technologies.
Unfortunately for the hard pressed British electorate, ‘cheap, green energy’ is nothing more than an empty political slogan arrived at by a dishonest sleight of hand. Specifically, the politicians simply ignore the true costs of the ‘cheap, green energy’ which soon becomes very expensive when factoring in all costs.
The chart below is from the U.K. Government’s own Electricity Generation Costs 2023 report and forms the centrepiece of the green propaganda. It purportedly shows the ‘levelised cost of electricity’ (LCOE) for different generating technologies. The Government uses deceptive calculations to arrive at a distorted cost for electricity generated by wind-power over the lifetime of a plant, by which means the Government can falsely claim that offshore wind is 2.5 times cheaper than dirty old gas generation (CCGT).
The most outrageous trick in this ‘analysis’ is that the Government has treated completely reliable electricity generated by gas (‘dispatchable’, in the trade jargon) in exactly the same way as extraordinarily unreliable electricity generated by a wind farm. This is not even an apples and oranges comparison, this is an elephant and microchips comparison. As a simple thought experiment, how much of a discount would you require for a car, cooker or washing machine whose operation was controlled externally and is very hard to predict versus the same equipment where you decide when you use it? For most people the answer would be an enormous discount, indicating that the true utility of variable electricity supply is very, very low.
There is really no comparison between an inexpensive tried-and-tested reliable power source and an exceptionally unreliable megawatt hour. We really are being had for a patsy.
To make costs comparable, you would need to state them on a comparable dispatchable basis, which means combining a wind farm with a battery storage facility to produce stable supply. At the moment there are only a handful of battery projects, which are very costly and provide only a short period of supply for their catchment area. As an indicator of the scale of battery backup required to ‘plug the gap’ when wind and solar power falter due to weather conditions, the Australian city of Melbourne has installed a ‘battery farm’ at Hornsdale at a cost of A$90m, covering 2.5 acres that can provide 28 minutes of electricity if there is a total failure of ‘renewable’ energy supply.
For reference, calculations by Bjorn Lomborg, the President of the Copenhagen Consensus Centre, indicate that the EU’s entire battery capacity is enough to cover one minute and 21 seconds of average demand. At this stage, it isn’t possible to calculate a cost per MWh (megawatt hour) for offshore wind farm plus battery installation, but it is clear that the resulting levelised cost would be very high and orders of magnitude (i.e., multiples of 10) higher than in the chart above (£44 per MWh).
In prior years, the Government at least made a half-hearted stab at acknowledging the enormous difference in utility between reliable and unreliable electricity by considering various downstream impacts of variable green electricity. The methodology was not fully disclosed, but it involved adding additional costs onto wind farms to adjust their levelised costs and then deducting costs from the levelised cost of combined cycle gas turbine plants, which have delivered uninterrupted, cheap energy for decades. That analysis resulted in a somewhat complex chart showing ‘enhanced levelised cost of electricity’, which we have simplified below.
It is plain to see that gas (CCGT) is the cheapest form of electricity generation on an enhanced levelised cost basis even when accounting only in this partial way for downstream network costs.
The Government has not included any such assessment of downstream impacts in the 2023 analysis because so called ‘balancing costs’ have been shifted on to the consumer. This is an arbitrary accounting convention and ignores the fact that the same costs will need to be incurred, regardless of whom they are charged to.
Note also that between 2020 and 2023 assessments, the Government massively and somewhat arbitrarily inflated the cost of gas (CCGT) based on a very much higher ‘carbon costs’ from £32 per MWh to £60 per MWh (the carbon costs are a somewhat arbitrary value that the Government places on the ‘social cost’ of carbon emissions). By moving this assumption up, or down, the Government can itself alter CCGT levelised costs and attractiveness relative to other forms of generation. This huge increase has distorted the 2023 outcomes to make gas appear much less attractive compared to wind. Ultimately though this is a policy assumption rather than a physical or market factor and is driven by value judgements rather than scientific reasons.
We have illustrated that for the 2023 assessment, by using the Government’s own earlier method of analysis we have gone from a position where offshore wind appears to be 2.5 times cheaper than gas to a position were gas is the cheapest form of generation when factoring in the system impacts as they were accounted for in the 2020 assessment.
There are a number of other questionable assumptions that unsurprisingly all work towards inflating the levelised costs of electricity from gas and reducing the levelised cost of wind. The main such assumption being a very high 61% load factor for offshore wind, which as far as we are aware has not ever been achieved anywhere in practice (the ‘load factor’ is the amount of electricity produced by a wind farm over a year as a proportion of how much it would produce if the wind was always favourable). The Government itself shows actual load factors for offshore wind farms were in the range of 39% to 47% up to 2017.
If you were to go a stage further and construct a truly representative scenario where gas power generation was replaced by wind, you would have to factor in the reality that you would need to effectively keep your old gas generation in reserve in order to have an uninterrupted supply of electricity. This leads to suboptimal operation of the gas plant and very high unit costs with lower output on the same fixed cost base.
In the scenarios that we looked at, any saving from ‘low cost’ wind, primarily lower due to carbon costs, would be more than offset by the very high unit cost of electricity from gas which would have to be purchased at enormous ‘standby’ costs to cover every period of low or excessive wind to prevent blackouts.
Real world data – the acid test
Observed data is always the acid test and in an excellent report by Mark P. Mills from the Manhattan Institute, he includes a chart of residential electricity prices versus wind and solar capacity per capita across European countries. Doubtless there may be some cofounding factors, but overall the trend is crystal clear: more ‘cheap’ renewable energy is directly linked to higher residential energy prices. Very much as we expected and the opposite outcome to that promised by the U.K. politicians.
The technocrats only real answer to the problem of unreliable renewables is to limit the ability of the consumer to use electricity. This is probably the main reason that smart meters and smart appliances are being rolled out to the end of 2025. Again the needs of the citizen will effectively be made subordinate to the needs of the system, itself dictated by ideology rather than supply problems or verifiable scientific reasons – a new and very unhealthy direction of travel.
Conclusions
You can see how easy it is to go from the fantasy of ‘cheap wind power’ promoted by the political class to the reality of very expensive wind, simply by including the real downstream costs. We have identified that the necessity of maintaining gas backup to wind power means that any savings from wind will often be more than negated by the costs of backup power. This proposition ties in with the observed reality that countries with higher levels of wind and solar capacity tend to have higher residential electricity prices.
The real problem though is the hell-for-leather dash for Net Zero and the accompanying plans produced by the unelected and unaccountable Climate Change Committee. This Soviet-style planning coupled with the Department for Business, Energy & Industrial Strategy arbitrating between different technologies and handing out billions in support of its favoured solution has all the characteristics of an accident waiting to happen. Bjorn Lomborg warned that “we are now going from wasting billions of dollars on ineffective policies to wasting trillions”.
The accelerated implementation of unreliable wind power will almost certainly lead to higher costs, lower living standards and the erosion of competitiveness and not to the green nirvana dishonestly promoted by Westminster politicians.
Alex Kriel is by training a physicist and was an early critic of the Imperial Covid model. He is a founder of the Thinking Coalition, which comprises a group of citizens who are concerned about Government overreach. Duncan White is a retired nurse with extensive experience of healthcare management and international health consultancy. He has researched Government carbon related policies for a number of years in cooperation with several U.K. groups representing the interests of motorists. This article was first published on the Thinking Coalition website. Sign up for updates here.
“He [the Stanton County, NE sheriff] was investigating what was essentially a federal crime. But once folks like you got the word out about what was happening, U.S. Fish and Wildlife did take decisive action. And the US Attorney’s Office for the District of Nebraska indicted two gentlemen, both illegal aliens-one is in custody and has pled guilty, [for] violating the Bald and Golden Eagle Protection Act. And the other suspect is at large at this time.” — Mike Flood, congressman representing Nebraska’s 1st Congressional District
In Episode 377 of District of Conservation, Gabriella speaks with Congressman Mike Flood (R-NE). Rep. Flood represents Nebraska’s 1st Congressional District. He joins the program to provide an update on a case involving the poaching of an American bald eagle by illegal immigrants in his district; his recent Fox News op-ed on Biden’s energy/climate policies, how ESG affects farming and ranching, and more.
In Episode 579 of District of Conservation, Gabriella discusses the permitting reform bill – aka BAAJA – that is gaining traction in Congress now. The Senate will hold a cloture vote starting at 3:30pm ET in a motion to proceed. Gabriella discusses the status quo without permitting reform, how BAAJA is good for the environment and affordability. Tune in!SHOW NOTESBipartisan Policy Center: BAAJA ExplainerEstimating the US Energy System Impacts of the Bipartisan American Affordability and Jobs Act
The president of the upcoming COP28 climate talks in Dubai called on Sunday for governments to abandon “fantasies” such as hastily ditching existing energy infrastructure in pursuit of climate goals, reports Phys.org.
Climate talks are being held in the Saudi capital Riyadh ahead of the COP28 conference that will take place in Dubai in November.
By Robbie Corey-Boulet with Imran Marashli in Paris
The president of the upcoming COP28 climate talks in Dubai called on Sunday for governments to abandon “fantasies” such as hastily ditching existing energy infrastructure in pursuit of climate goals.
“We cannot unplug the energy system of today before we build the new system of tomorrow. It is simply not practical or possible,” Sultan Al Jaber said during the opening session of Middle East and North Africa (MENA) Climate Week, a UN-organized conference hosted in the Saudi capital Riyadh.
“We must separate facts from fiction, reality from fantasies, impact from ideology, and we must ensure that we avoid the traps of division and distraction.”
Much of international climate diplomacy revolves around the thorny issue of how and when to quit fossil fuels.
At COP26 in Glasgow in 2021, countries agreed to phase down “unabated coal”, the first time a fossil fuel was explicitly mentioned in a final text.
But efforts since then to extend such a target to all fossil fuels have foundered, most recently at last month’s G20 summit in India.
Climate activists have criticized the appointment of Jaber to lead the COP28 talks which kick off in Dubai in November, given that he is also head of the Emirati state-owned oil firm ADNOC.
But Jaber has garnered the support of COP parties including US climate envoy John Kerry, partly by emphasizing his belief that “the phase-down of fossil fuels is inevitable”.
Energy officials in the United Arab Emirates and other oil-producing countries—notably Saudi Arabia, the world’s biggest oil exporter—have argued for continued investments in fossil fuels to ensure energy security even as they eye an eventual transition away from them.
Finding funds
The vast and fractured landscape of climate finance is the other major stumbling block in climate negotiations.
Developing countries least responsible for climate change are seeking money from richer polluters to adapt to its increasingly destructive and expensive consequences.
In 2009, rich countries pledged to supply $100 billion of climate finance every year to developing nations but failed to meet the 2020 deadline. There are hopes the goal will be met this year.
“Old promises must be kept, including the $100 billion pledge made over a decade ago,” Jaber said on Sunday.
Last year’s COP27 talks in Sharm el-Sheikh, Egypt, ended with the first ever creation of a “loss and damage” fund into which countries would pay to support poorer nations suffering the most from more intense and frequent storms, floods and droughts.
The fund’s operation, governance, location, contributors, beneficiaries and a timeline for payouts are all up in the air ahead of COP28.
“We must make the fund for loss and damage that was promised in Sharm el-Sheikh a reality in Dubai,” Jaber said.
Climate ‘crossroads’
The talks in Riyadh are intended to “shine a spotlight on challenges and solutions in a region that is among the most vulnerable to the effects of climate change,” organizers said in a press release on Sunday.
The region must already grapple with high temperatures and water scarcity, with more than 60 percent of the population having “very little if any access to potable water”, the statement said.
“Increasing temperatures are predicted to lead to more persistent and acute drought,” it added.
Jaber also highlighted challenges facing the region, referring to extreme events like hurricane-strength Storm Daniel, which last month caused two dams in eastern Libya to burst and flood the city of Derna.
“Climate change isn’t a threat waiting around the corner—the MENA region knows this from first-hand experience with fierce heat waves and water shortages,” said Inger Andersen, executive director of the UN Environment Programme.
Simon Stiell, executive secretary of UN Climate Change, said the region was “at a crossroads, facing not only the devastating impacts of climate change but also the challenge of transitioning their economies to ensure prosperity in a 1.5C aligned world.”
The goal of limiting warming to 1.5 degrees Celsius above pre-industrial levels was set at the 2015 climate talks in Paris.
While the UAH satellite measurements are the hottest by far of the 44 year satellite record, nothing about the “hottest ever” media frenzy makes sense — not for health, history, the long term, or human biology. It’s only the “hottest ever” if we ignore most of the last ten thousand years. It’s just another attempt to scare people out of their money.
The latest UAH satellite measurements may be affected by the water vapor launched into the atmosphere by the Hunga Tonga volcano. There don’t appear to be any clear details about that, but even if we accept this as is, it’s still nothing to spend a trillion dollars on:
In the big scheme of human history, the world has been a lot hotter and a lot colder. Homo sapiens are 37 degree animals who retire to warm climates, not cold ones. Most people on Earth live in the warm tropics, not the cold poles. Two hundred million years of evolution mean mammals are made to deal with temperature change. We live in places that range from minus 50C minimums to plus 40C maximums (-58F to 107F). That’s a ninety degree temperature range (or 160F), and we’re supposed to panic if the world heats by half a degree more?
The hottest inhabited place on Earth is probably Kebili, Tunisia, where 60,000 people live and the average July maximum is 41.7°C (107F). And Marble Bar, Western Australia, has had an average of 41°C in Januaryfor the last 100 years (106F). Fossil Fuels make it possble. Give the poor air conditioning!
The coldest inhabited place is Oymyakon, Siberia, Russia, where 500 people live even though the average temperature for January is -50°C (-58F). These are the average temperatures, not the hottest and coldest days.
Almost every day of the year we deal with five to twenty degrees of warming, and that’s just dawn to afternoon tea.
Cold is the big threat to crops and lives, not heat
Human mortality rises 6 – 20 times higher in winter, even in hot cities like Brisbane, Australia. The biggest climate threat humans face is the next ice age. Twenty thousand years ago there were walls of ice a kilometer high over New York — that’s 2,000 feet of frozen water that has to melt before you can plant your plum tree.
The “Hottest Ever September” was just the hottest in the 40 year satellite record. The world was likely hotter in Roman Times, Hotter in Minoan Times, and hotter during the Holocene peak 7,000 years ago. Sea levels were 1 – 2 meters higher then, when humans lived in mudhuts and teepees. Yet somehow humans thrived.
Our paid academics should be speaking up to give us some perspective. Our public funded media ought be giving us the whole truth and nothing but the truth. Our ABC, BBC, CBC and NPR “science units” need to start reporting science, not just the one-sided propaganda that screws money from taxpayers, and feeds childhood anxiety.
UPDATE: This graph shows the ice-core data up until 1855. The last 150 years (1705 to 1855) are highlighted in red to show the warming as the Earth began coming out of the LIA.
Western Australia is one of the oldest and most stable parts of Earth, making it an ideal place to study sea levels. We’re worried about seas rising by 3mm a year (and only after the satellites were “adjusted”) but the oceans rose 125 meters, stayed high for thousands of years and have been falling for most of human civilization.
Save the world from witchdoctors. Teach children geology and the history of the Earth.
___
PS: Any miners reading this with photos of Marble Bar they don’t mind me using? Please send them in. There are surprisingly few photos available on any copyright free libraries. Somewhere out there someone must have a photo of shimmery heat rising off bitumen!
A new analysis by David Turver dismantles the recent Royal Society report on electricity storage:
Summary
The Royal Society (RS) has recently released its Large-Scale Electricity Storage report that says we can provide the electricity we need using wind and solar power supported by large-scale hydrogen storage. The report makes some extraordinary claims that are interrogated by this report that also seeks to find the extraordinary evidence required to validate their claims. One positive aspect of the RS report is the painstaking analysis of the variations in wind and solar power we might expect over yearly and decadal timescales that drive the need for a very large energy store. The RS report also effectively rules out batteries as a viable alternative as a large-scale energy store.
However, the positive parts of the report stop there. They begin by assuming that electricity demand will be 570TWh in 2050 that represents roughly halving the energy demand across residential, transport and industrial and commercial categories. The evidence from Our World in Data shows that rich economies require high energy consumption to thrive. There are no rich countries with low energy consumption and those countries that have reduced energy consumption have grown more slowly, or even shrunk. The first extraordinary claim of low energy consumption fails because the evidence shows that if we allow that to happen, we will be much poorer.
The report then goes on to assume that the profile of electricity demand will be the same as today. However, as we move from gas to electricity to heat our homes and offices, the winter surge in electricity demand will be further exaggerated. Moreover, demand will change from year to year such as during the cold winter in 2010 that also coincided with a calm period when we would have generated much less renewable electricity. These variations in demand profile will lead to more generation capacity and an even bigger energy store than RS assumes, pushing up costs.
On the supply-side, the report assumes unrealistic load factors for both onshore and offshore wind. They assume that the installed capacity in 2050 will have load factors far higher than has been achieved so far. Even allowing for some technological improvements, the capacity they need to meet their low generation target will need to increase by at least 20%. This would mean a sizeable increase in the capital costs of generation to deliver their plan, pushing up the costs of wind power very significantly. In fact, the costs they assume for renewable electricity generation are three or four times lower than we pay today through Contracts for Difference (CfDs) and Feed-in-Tariffs (FiTs) and are very much lower than achieved in the latest auction round. Using more realistic assumptions about generation costs would double their weighted average generation cost to around £90/MWh.
The RS report calls for 112GW of offshore wind capacity. As discussed above, this is too low to meet their generation target which is also too low. However, low generation capacity estimate is undeliverable. Extrapolating current offshore development trends shows nearly two thirds of their offshore wind capacity target would remain unbuilt by 2050.
The report then goes on to assume efficiencies and costs for hydrogen electrolysers, storage and generation that do not stand up to scrutiny. The efficiencies are based on high-end projections of what might be achieved by 2050. These would be an enormous stretch to achieve and even if they were, the average of the installed fleet in 2050 is bound to have a lower efficiency. These lower realised efficiencies will push up the costs dramatically. They also assume no leakage of hydrogen stored underground at high pressure for a up to a decade. Assuming some leakage would push up costs further. The individual costings are all based on estimates produced before the latest inflationary surge that has pushed up the costs of everything which means the costs in today’s terms are far too optimistic. Again, even if their costs are achievable by 2050, much of the infrastructure will have to be built using today’s cost base which will push up the average dramatically.
The base-case for their financial assessment assumes a risible 5% cost of capital, lower than the current base rate. Even their sensitivity analysis that uses a 10% cost of capital is probably way too low. Investors are going to require rates of return of 15% or more to invest in immature technologies that will only ever have low load factors. It is likely that using more realistic efficiency estimates and costs of capital will at least double their base case estimates for their proposed hydrogen system.
After all that effort, the system they propose will have a very low energy return on energy invested (EROEI), meaning we will spend more than a quarter of our gross energy to produce the energy we need to live. Throughout human history, we have increased EROEI which has allowed us to thrive. This proposal takes us back to Iron Age times.
Even if their proposed energy system would produce enough to ensure a thriving society and the costs were realistic the report overlooks the human factors that would be required to deliver it. We would need thousands more skilled engineers that would not be available from abroad, because those countries would need them to complete their own projects.
Overall, the report starts with an unrealistically low estimate of future electricity demand which itself is an undesirable outcome. It then goes on to add its own unrealistic claims about the cost and efficiency of hydrogen electrolysers, storage and generation using a risible base case 5% cost of capital. In essence, the report expects us to believe we can deliver lots more renewable energy and a complete hydrogen ecosystem in 2050 for about the same as the cost per MWh of renewables in this year’s renewable auction. It’s a fantasy.
Even if it were deliverable, we would end up with an energy system near the bottom of the energy cliff producing about half the energy we need to run a modern society. It is simply not credible. The extraordinary evidence to support their extraordinary claims simply does not exist. Quite the contrary, there is a plenty of evidence that their claims are a fairy tale. Because the RS report also effectively rules out batteries as the energy storage medium to support intermittent renewables, the entire renewables project should be scrapped.
The northeast coastline of the Greenland ice sheet is seen in an image from NASA’s Oceans Melting Greenland (OMG) field campaign from an altitude of about 40,000 feet (12,190 meters) taken March 26, 2016 and released March 29, 2016. REUTERS/NASA/Handout via Reuters THIS IMAGE HAS BEEN SUPPLIED BY A THIRD PARTY. IT IS DISTRIBUTED, EXACTLY AS RECEIVED BY REUTERS, AS A SERVICE TO CLIENTS. FOR EDITORIAL USE ONLY. NOT FOR SALE FOR MARKETING OR ADVERTISING CAMPAIGNS – RTSCP42
The magnitude problem persists for peddlers of Climate Alarm.
During the last interglacial (LIG) 127-119k years ago atmospheric CO2 was said to be 275 ppm, and yet the global sea levels were 6-9 m higher than they are today.
The higher sea levels were due primarily to the LIG’s substantially warmer temperatures, which meant that less water could remain frozen on land as ice during these millennia.
For example, in contrast to today’s 1-2 km thick northern Greenland ice sheet, the Greenland’s northernmost latitudes were ice-free (and vegetated/forested) during the LIG warmth, a melt magnitude that is estimated to have added 300 cm (3 m) of sea level equivalent (SLE) to the globe’s sea levels (Sommers et al., 2021).
Today, in contrast, Greenland’s ice sheet covers 80% of the land mass, including 100 m and more ice thicknesses stretching across northern and southwest Greenland – regions which were ice-free during the LIG.
From 1992 to 2020, as CO2 rose from 356 to 415 ppm, the sea level rise contribution from Greenland’s ice melt amounted to a total of just 1.2 cm of SLE (Simonsen et al., 2021).
When viewed in this larger context, a 1.2 cm SLE ice melt contribution from the Greenland ice sheet in the last 28 years doesn’t seem nearly as significant or concerning as it does when perpetuators of climate alarm refer to hundreds of billions of tons of ice lost each year.
Households and businesses faced with crippling power bills are just another bad optic for renewable energy rent seekers. The political support upon which the seemingly endless flow of massive subsidies depends, in turn, depends on the proles’ attitude to those charged with delivering reliable and affordable power.
Having just been whacked with 20-30% increases in their power bills – on top of increases of between 10-20% in retail power prices that took effect throughout the financial year – many households and businesses will see a 50% jump in their power bills in less than 12 months. Those on the receiving end of the grand wind and solar transition are understandably aggrieved. Australian power consumers have been lumped with annual, double-digit increases every year, for the best part of a decade (see above).
Alan Moran provides some helpful detail on how and why we’ve landed in a world with increasingly unaffordable power.
Unexpected Costs Spectator Australia Alan Moran 17 September 2023
Manipulated estimates of Levelised Cost of Energy tables showing wind and solar to be the cheapest supplies of energy are contradicted by the trends on actual electricity costs and inter-country comparisons.
The readily available data by country for the wind and solar renewables share and price of electricity show a high share of renewables is concomitant with high electricity costs. The cheapest electricity is found in the nations with the lowest renewable energy share: Saudi Arabia, Russia, India, UAE and Korea. Germany, the UK, the Netherlands, Spain and Italy have high prices and high renewables shares.
Australia’s renewables share is similar to that of Italy, but (for the time being) has lower electricity prices.
[Note to Alan: the EIA figure in their dataset of US 0.23 per kwh is well below prevailing rates in Australia – the graphic has Australian power prices even cheaper than that, which is not correct. South Australians have just been hit with power bills where their peak rates are AUD 0.495 per kwh, which at current exchange rates translates to US 0.32 per kwh, way above what is represented in the graph above.]
Even so, there is accumulated vested interests in promoting the ‘renewables are cheap(ish)’ myth.
For Australia, this comprises a vast bureaucracy of government departments, research agencies like CSIRO, government-assisted NGOs, an array of educational and financial institutions and, of course, politicians in both the ALP and the Coalition. The National Party, in seeking greater scrutiny of new renewable proposals, is edging its way to abandoning the sacred Net Zero creed. Politicians will shamelessly reverse course on a policy they have championed when it proves to be downright wrong and unpopular. They will avoid the pitchforks by blaming poor advice from the ‘experts’. These experts have also proven adept at dodging the bullets for policy failures (think the 264 UK economists who maintained Mrs Thatcher’s cost-cutting would have catastrophic consequences and the health experts who promoted Covid lockdowns). Once the climate myth and its renewable energy companion are discredited, they will dig deep to find another cause receptive to government intervention.
In spite of renewables requiring massive subsidies to be profitably installed – $10 billion a year in Australia’s case – propaganda about renewables being the cheapest form of energy is unrelenting. But subsidies aside, renewables are only remotely competitive if consumers will take their electricity whenever it is produced and will do without it whenever the vagaries of weather pare back its availability. That’s the equivalent of skiers paying for lift tickets even if there’s no snow and flocking to the slopes in even greater numbers during a blizzard!
For anything approaching the government’s goal of 100 per cent renewables, the backup required is upward of 20 days of storage based on the estimates of Francis Menton. For Australia that is 13,000,000 megawatt hours. Even with highly optimistic assumptions, Paul McArdle of Global Roam came to an estimate of 9,600,000 megawatt hours. Menton cites the US National Renewable Energy Laboratory estimates of storage costs by 2030 at $US200,000 per megawatt hour. This cost means reliability-proofing Australia’s network at an outlay many times the nation’s GNP. And this is just to firm-up the weather-dependent sources of energy, an expense that is not required for coal, gas or indeed, nuclear.
For its part, to accommodate the dispersed nature of wind and solar, the government plans to spend $100 billion for transmission, a five-fold increase on the present system’s costs. On top of this are sums, not yet estimated, for reinforcing the distribution network to allow rooftop generation to be exported.
But like the cunning plans of Blackadder’s Baldrick, these schemes are not panning out.
Farmers, fishers, and other people in remote locations are showing an unexpected truculence; for many, the transmission lines and land-extensive wind and solar operations impose inefficiencies (for example, impeding spraying) additional to the national waste they represent. Other opposition stems from people more fully recognising the visual and noise intrusion. Coordinated local opposition is being generated against individual projects, causing a slowdown in project authorisations. These are bringing unexpected costs to renewable energy proposals and retarding the already ambitious plans for Net Zero. Governments are reacting by seeking to truncate development approval procedures but this may lead to even greater opposition.
In addition, global supply costs are rising. One outcome was a poor response to the UK government’s latest applications for additional wind and solar, despite contracts being offered at prices 2-7 times their actual value. In the US, Danish international offshore leader, Orsted has faced cost escalations bringing a collapse in its share price.
Other international pressures add to the home-grown ones. India, China, and Saudi Arabia have opposed a proposal by Western countries to cut greenhouse gas emissions by 60 per cent by 2035. What was once called the Third World now accounts for the great bulk of global CO2 emissions and places a low priority on abating CO2 emissions. Those countries’ actions will kick down the door of the global warming and renewable energy farce. This cannot come too soon. Spectator Australia
Labor in office: time to take stock Spectator Australia Alan Moran 28 September 2023
The Prime Minister, the Treasurer and the Energy Minister were supposedly somewhat trained as economists, but all three fail to grasp the discipline’s basic principles.
Energy Minister Bowen claims that his renewables program will create 60,000 jobs by replacing ‘legacy’ coal plants with wind and solar facilities plus the increase in power lines and batteries that replacement will entail.
While increases in jobs (and/or income levels) may result from the services stemming from government spending, Mr Bowen’s numbers refer to the gross jobs involved in the construction activities themselves. As those jobs are tax-funded, they are offset by jobs elsewhere in the economy due to lower spending from individuals whose incomes have been reduced by government taxes and regulatory measures.
Mr Bowen’s claim is especially specious since his program replaces low-cost (coal) with high-cost (wind and solar) energy services and therefore has a negative effect on productivity, incomes, and jobs. Like the Treasurer, his conviction is that forcing a ‘transition’ to high-cost low-reliability energy will bring economic benefits.
The forced transition from low-cost reliable energy is being amplified by the present government. One policy driving this is the ‘Safeguard mechanism’ that requires the top 215 CO2 emitters to reduce emissions by 30 per cent on top of that forced by general requirements.
Subsidies to renewables now amount to over $10 billion a year. That $10 billion of wasteful spending is equal to the market value of all wholesale electricity prior to the price escalation caused by renewable subsidies. The adverse effects of this are compounded forcing unsubsidised power stations to close.
Seemingly unaware of the reality of power cost increases, Mr Bowen, through a spokesman, maintains ‘delivering cleaner, cheaper energy across the country is a whole of society imperative’.
Unfortunately, taking down the economy through imposing higher renewable requirements is not the only delinquent policy Labor is pursuing.
In macro terms, the Treasurer has poured additional fuel onto the big spend Covid programs inherited from the Coalition. There is $61 billion in new spending (to its shame the Coalition has actually supported much of this) with $27 billion of new taxes. He claims a bottom-line improvement but this was due to $42 billion in windfall gains due to high commodity prices and new employment (partly through high immigration levels).
For his part, the Minister for Employment, Tony Burke, claims no training in economics. He can therefore excuse his actions in his crusade to destroy the ‘gig’ economy as due to being totally uninformed by a knowledge of the interactions of politics on costs. The ‘gig’ economy is composed of almost entirely non-unionised workers and allows working arrangements in areas ranging from pizza deliveries to mining services to respond to the needs of customers flexibly at low cost. The proposed rigid IR arrangements will impose massive costs on consumers and business, amplified by affording privileges to union recruiters and a Sword of Damocles of uncertainty over the practical implications of the proposals.
This same cavalier attitude to cost impositions is seen in the environment portfolio. The Minister, Tanya Plibersek, is pouring cold water on new projects in northern Queensland by pandering to UN pressures (and her own Green-challenged constituency) by knocking back mines like Clive Palmer’s Central Queensland Coal Project claiming it was ‘likely to have unacceptable impacts to the Great Barrier Reef Marine Park’. Data released by the Australian Institute of Marine Science confirmed the accuracy of measurements and analyses conducted by Dr Peter Ridd that the reef is in great environmental health.
Further courting the environmentalist vote, Ms Plibersek is also reducing the water available to irrigators in the nation’s most important agricultural province, the Murray Darling.
Labor is now halfway through what it hopes to be its first term of government. Aside from driving a cultural divide with its Voice campaign to segregate the nation, so far, its performance has been an unremitting assault on the settings that drive increased productivity and income levels. Sadly, according to opinion polls, the policy is enjoying success in the eyes of an electorate seduced by an avalanche of rhetoric. Hopefully, a realisation of the damage being done will result in policy reversals before the damage becomes permanent. Spectator Australia
Ed. Note: This post excerpts energy and climate material from the Media Balance Newsletter, a free fortnighly published by physicist John Droz Jr., founder of the Alliance for Wise Energy Decisions. The complete Newsletter for this post can be found here.
Extraordinary claims require extraordinary evidence. Carl Sagan
Summary
The Royal Society (RS) has recently released its Large-Scale Electricity Storage report that says we can provide the electricity we need using wind and solar power supported by large-scale hydrogen storage. The report makes some extraordinary claims that are interrogated by this report that also seeks to find the extraordinary evidence required to validate their claims. One positive aspect of the RS report is the painstaking analysis of the variations in wind and solar power we might expect over yearly and decadal timescales that drive the need for a very large energy store. The RS report also effectively rules out batteries as a viable alternative as a large-scale energy store.
However, the positive parts of the report stop there. They begin by assuming that electricity demand will be 570TWh in 2050 that represents roughly halving the energy demand across residential, transport and industrial and commercial categories. The evidence from Our World in Data shows that rich economies require high energy consumption to thrive. There are no rich countries with low energy consumption and those countries that have reduced energy consumption have grown more slowly, or even shrunk. The first extraordinary claim of low energy consumption fails because the evidence shows that if we allow that to happen, we will be much poorer.
The report then goes on to assume that the profile of electricity demand will be the same as today. However, as we move from gas to electricity to heat our homes and offices, the winter surge in electricity demand will be further exaggerated. Moreover, demand will change from year to year such as during the cold winter in 2010 that also coincided with a calm period when we would have generated much less renewable electricity. These variations in demand profile will lead to more generation capacity and an even bigger energy store than RS assumes, pushing up costs.
On the supply-side, the report assumes unrealistic load factors for both onshore and offshore wind. They assume that the installed capacity in 2050 will have load factors far higher than has been achieved so far. Even allowing for some technological improvements, the capacity they need to meet their low generation target will need to increase by at least 20%. This would mean a sizeable increase in the capital costs of generation to deliver their plan, pushing up the costs of wind power very significantly. In fact, the costs they assume for renewable electricity generation are three or four times lower than we pay today through Contracts for Difference (CfDs) and Feed-in-Tariffs (FiTs) and are very much lower than achieved in the latest auction round. Using more realistic assumptions about generation costs would double their weighted average generation cost to around £90/MWh.
The RS report calls for 112GW of offshore wind capacity. As discussed above, this is too low to meet their generation target which is also too low. However, low generation capacity estimate is undeliverable. Extrapolating current offshore development trends shows nearly two thirds of their offshore wind capacity target would remain unbuilt by 2050.
The report then goes on to assume efficiencies and costs for hydrogen electrolysers, storage and generation that do not stand up to scrutiny. The efficiencies are based on high-end projections of what might be achieved by 2050. These would be an enormous stretch to achieve and even if they were, the average of the installed fleet in 2050 is bound to have a lower efficiency. These lower realised efficiencies will push up the costs dramatically. They also assume no leakage of hydrogen stored underground at high pressure for a up to a decade. Assuming some leakage would push up costs further. The individual costings are all based on estimates produced before the latest inflationary surge that has pushed up the costs of everything which means the costs in today’s terms are far too optimistic. Again, even if their costs are achievable by 2050, much of the infrastructure will have to be built using today’s cost base which will push up the average dramatically.
The base-case for their financial assessment assumes a risible 5% cost of capital, lower than the current base rate. Even their sensitivity analysis that uses a 10% cost of capital is probably way too low. Investors are going to require rates of return of 15% or more to invest in immature technologies that will only ever have low load factors. It is likely that using more realistic efficiency estimates and costs of capital will at least double their base case estimates for their proposed hydrogen system.
After all that effort, the system they propose will have a very low energy return on energy invested (EROEI), meaning we will spend more than a quarter of our gross energy to produce the energy we need to live. Throughout human history, we have increased EROEI which has allowed us to thrive. This proposal takes us back to Iron Age times.
Even if their proposed energy system would produce enough to ensure a thriving society and the costs were realistic the report overlooks the human factors that would be required to deliver it. We would need thousands more skilled engineers that would not be available from abroad, because those countries would need them to complete their own projects.
Overall, the report starts with an unrealistically low estimate of future electricity demand which itself is an undesirable outcome. It then goes on to add its own unrealistic claims about the cost and efficiency of hydrogen electrolysers, storage and generation using a risible base case 5% cost of capital. In essence, the report expects us to believe we can deliver lots more renewable energy and a complete hydrogen ecosystem in 2050 for about the same as the cost per MWh of renewables in this year’s renewable auction. It’s a fantasy.
Even if it were deliverable, we would end up with an energy system near the bottom of the energy cliff producing about half the energy we need to run a modern society. It is simply not credible. The extraordinary evidence to support their extraordinary claims simply does not exist. Quite the contrary, there is a plenty of evidence that their claims are a fairy tale. Because the RS report also effectively rules out batteries as the energy storage medium to support intermittent renewables, the entire renewables project should be scrapped.
Introduction
The Royal Society recently released its Large Scale Electricity Storage report authored by Professor Chris Llewellyn-Smith saying we can meet our demand for electricity with wind and solar, supported by large-scale hydrogen storage. They claim that the cost of this approach “compares very favourably” with the cost of low-carbon alternatives. To get to their conclusions, they make some heroic assumptions and make some extraordinary claims about energy demand, generation capacity, the costs of renewables and the cost of storage required to meet net zero targets. This article examines their claims and seeks to find the extraordinary evidence required to validate their assertions.
What is good about the Royal Society Large-Scale Electricity Storage Report
Before diving into the significant weaknesses in the RS report, we should spend a little time focusing on the main positive aspect of the report. The thing that stands out most is the painstaking analysis that has been conducted to understand the very significant changes in the weather that occur on yearly and decadal timescales. They analysed wind and solar records over 37 years to estimate the level of variation we might expect from wind power. They found that we can sometimes have several consecutive years where the wind speed is lower than average. This means that if we are to have a grid powered solely by wind, solar and storage, then we need to build up massive stores of energy in the windy years to be used in the calmer years. They conclude that to consistently deliver their 570TWh of electricity each year, we would need 123TWh of hydrogen storage. Some of that hydrogen may have to be stored for a decade or more before it is used. This has important implications for the economics of storage and effectively rules out batteries as the storage medium. Who would want to spend millions on building a battery or hydrogen storage cavern, even more to fill it and maintain it, yet not see any revenue from it for years after it was completed?
Royal Society Electricity Demand Estimate
Now on to the significant weaknesses. The first thing to look at is the expected demand for electricity in 2050. The report settles on 570TWh as their estimate of demand. This is higher than the 518TWh they claim to be in the 2022 FES report, but lower than the 672TWh in the higher demand scenario of the Government’s 2020 modelling of 2050 electricity demand.
There are several problems with this as a starting point for 2050 electricity demand. First, the 2022 FES report has total electricity demand of 598-810TWh for Residential, Industrial & Commercial and Transport across their Net Zero scenarios for 2050. All these scenarios are higher, some much higher, than the 518TWh assumed in the RS report. These scenarios are much lower than other estimates for a largely nuclear-powered grid in 2050. This report arrived at 1,081TWh based on less optimistic assumptions of the efficiency gains to come from electric vehicles and heat pumps as well as allowing for economic growth and an increase in the population. For reasons discussed below, this estimate may be too low. 1,081TWh is well below the implied 1,338TWh 2050 electricity consumption target suggested by Professor Sir David MacKay set out in Sustainable Energy Without Hot Air (SEWTHA) in 2008. Table 1 below compares scenarios from different sources.
Table 1 – Comparison of Future Energy Demand Scenarios for 2050
Second, this matters because there is a strong positive correlation between per capita energy consumption and per capita GDP. There are no rich countries with low energy use (see Figure 1).
Figure 1 – Energy Use per Capita vs GDP per Capita, 2021 Selected Countries (from Our World in Data)
Halving our per capita energy use would put us on a par with countries like Mexico, Brazil, Algeria and Paraguay, all very much poorer countries. To justify halving per capita energy consumption, we need some extraordinary evidence to demonstrate it is a sustainable proposition. Indeed, as Figure 2 (again from Our World in Data) shows there is a strong correlation between reductions in per capita energy consumption and slow growth (or even shrinking economies) on a per capita basis).
Figure 2 – Change in Energy Use and GDP per Capita 2008-2021 (from Our World in Data)
To further illustrate the extreme assumptions used to arrive at the overall demand figure, the RS report assumes that we will use only 96TWh of electricity for heat and 119TWh for transport (see p17 of the report). By contrast, according to DUKES Table 4.1.1, domestic consumers and service companies used 410TWh of gas in 2021, the vast majority for heat. Industry used a further 190TWh, probably mostly in industrial processes. Even if we ignore the industrial gas, they appear to be assuming a >4-fold improvement in efficiency from the switch to heat pumps. We might expect heat pumps to perform that well in mild weather, but when it is cold and you need your central heating on, the performance gain will only be around 2.5. It looks like they are planning for us to be cold in winter.
According to DUKES Table 3.2 we used 10,941kt of petrol and 21,228kt of diesel for road transport in 2022. This works out at about 392TWh of energy. The Royal Society is assuming we need only 119TWh of electricity for road transport in 2050, a reduction by a factor of 3.3 assuming no growth in mileage. There is likely to be an improvement in energy efficiency by switching to EVs because electric motors are more efficient than internal combustion engines. However, comparing the official figures for the VW ID3 to diesel and petrol VW Golfs, shows ratio improvements of 2.4 to 3 respectively and that does not include losses in transmission and charging the battery which might be of the order 5-10%. The RS assumptions look more than a little ambitious to say the least.
It looks like the starting assumption of electricity demand is off by a factor of two. This is important, because that means they will need around twice the generating capacity and roughly twice the storage capacity they have estimated. Now let us look at some of the other assumptions.
Unrealistic Profile of Demand
The Royal Society Large Scale Electricity Storage report recognises that demand for electricity varies with the seasons. They use a model from engineering consultancy AFRY to profile the shape of demand on an hour-by-hour basis. The example they show in Figure 3 below (their Figure 1) uses demand from 1992 scaled up to the 570TWh they expect to deliver each year.
As you can see, they expect demand in July to be around 60GW each day and demand in January to be around 33% higher at around 80GW per day. However, by simply using the current electricity demand profile as their template for the future, they have ignored even larger seasonal variations in demand for gas. Of course, we use far more gas in the winter because that is when we have the central heating on. This is illustrated well in one of their references, the H21 North of England report (p15) as seen in Figure 4.
Figure 4 – Seasonal Variations in Total UK Energy Use (from H21 project)
This shows gas demand varying by a factor of five or six from around 480GWh per day (20GW) in summer to 2,400-3,000GWh per day (100-125GW) in winter. Electricity demand varies from around 600GWh per day (25GW) in summer to 960GWh per day (40GW) in winter. Transport demand is relatively stable around 1,440GWh per day (60GW). Total demand is varying from ~105GW in summer to ~210GW in winter or roughly doubling, far more than the 33% increase they assume. The H21 exaggerates the problem somewhat because some of the energy is double counted because some of the gas is also used for electricity generation. However, even after stripping out gas used for that and assuming efficiency improvements from heat pumps and EVs, there will be larger seasonal variations than they have allowed for. This means they will need more wind and hydrogen generation capacity and possibly more electrolyser capacity than they estimate to meet peak demand.
To further illustrate this point, current peak electricity demand in winter is around 45GW. Consider that 24m homes with an average 12kW heat pump operating at a COP of 2.5 on a cold mid-winter night would generate a peak demand of 115GW. That is a total of 160GW without even considering EV charging or the electrification of industrial heat. The AFRY model they use assumes a peak demand of 98.4GW and they plan for 100GW of hydrogen generators to cover it. That is clearly not enough.
Inter-Annual Demand Variation
An additional wrinkle in the RS analysis is that they appear to be assuming that demand is consistent from year to year. Whereas, when domestic and commercial heating are electrified, demand will be much higher in cold years and lower in mild years. This is illustrated in Figure 4 above when the “Beast from the East” pushed up gas demand to around 150GW. Moreover, according to the Met Office Winter 2010 was a very cold year and both 2009 and 2011 were below average. In the RS model, weather conditions meant generation would have been low in the years 2009-2011 consuming most of the store, assuming flat demand (see Figure 5).
Figure 5 – Variation in Supply Consumes Most of the Energy Store 2009-2011
It is likely that there was above average heat demand from 2009-11, with exceptional demand in 2010. If variable demand is considered, it is highly likely that the store would have been depleted, implying they need to model for a larger store. They will likely also need more renewable and hydrogen generation capacity to meet the exceptional peak demand. Both these factors will of course increase costs.
To meet their estimate of 570TWh of demand, the RS report says we would need 200GW of installed generation capacity split 80% wind (160GW) and 20% solar (40GW). The wind component would be 70% offshore (112GW) and 30% onshore (48GW). They expect this generation mix to produce on average 741TWh each year. This is more than demand, but because the supply profile of wind and solar do not match demand, storage is required and extra energy must be produced to account for the roundtrip losses in making hydrogen, storing it and then burning it to produce electricity. They assume 89.4GW of electrolyser power to make hydrogen and 100GW of generation capacity to burn it will be necessary. Note that 100GW of hydrogen generation is more than double the current thermal installed generation capacity. They also assume 123TWh of hydrogen storage capacity will be needed as well as possibly compressed air storage which is discussed further below.
Now let us go through the assumptions they have made about the load factors and efficiencies of the different components. They have used load factors for wind and taken from the 2020 BEIS Generation Costs report. Plugging in 57% for offshore wind, 34% for onshore wind and 11% for solar gives the 741TWh average generation they are seeking. However, the estimates of load factors for wind do not bear any resemblance to what has been achieved in practice. According to Energy Trends T6.1, Over the past five years offshore wind has delivered 41.0% and onshore wind 26.4% average load factors. The load factors achieved for solar are slightly below 11% but are close enough to ignore.
Various experts have predicted big increases in load factors for new developments, but these do not seem to have materialised in practice. Moreover, to achieve such high average load factors, the new installations will have to achieve load factors close to the Government’s even more ridiculous higher estimates for 2050 covered here.
Allowing for some technological improvement by assuming the 2050 installed base has average 45% and 30% load factors for offshore and onshore wind respectively, the installed generation capacity would have to increase by more than 20% to ~243GW to meet their 741TWh average target. Even this assumption might be ambitious because there is strong evidence from another GWPF report that load factors decline with age, so the lifetime average may well be lower than this assumption. The load factors above mean 136GW of offshore wind, 58GW of onshore and 49GW of solar would be needed to meet their production target. This would represent a sizeable increase in the capital costs required to deliver their plan. The extra capacity required to deliver the same output will also push up the cost of wind power very significantly (see below).
The other curious thing is that they fail to explain how their planned 40GW of installed solar capacity manages to produce peak output of nearly 80GW on many days in July (see Figure 1). There is clearly some other hidden flaw in their modelling.
Generation Cost Fantasy
The Royal Society Large-Scale Electricity Storage report uses a weighted average of ~£45/MWh (their Figure 24) in 2021 money as their base cost of wind and solar supply (including transmission costs). This compares to the actual results of ~£70/MWh for onshore wind and £63/MWh for solar (both in 2023 money) awarded in AR5. Currently, we pay ~£177/MWh for offshore wind CfDs and £110/MWh for onshore. The average FiT price which is mostly solar was £196/MWh in 2022 with current solar CfDs £106/MWh in 2023 money. Of course, no offshore wind was awarded in AR5, so we have to estimate the costs for projects with near term delivery. The Government’s 2023 estimates of the future Levelised Cost of Energy (LCOE) were taken apart here. In summary, the Government had ignored the increasing costs of turbines and rising interest rates as well as making unrealistic assumptions about load factors. That analysis arrived at a more realistic estimated cost of ~£130/MWh for offshore wind. Even if that estimate was wrong, it is clear that offshore wind costs are well above the ~£55/MWh in 2023 money suggested by the Government in the AR5 auction.
Plainly, the weighted average base generation cost of wind and solar is far higher than estimated in this report. By using the costs of onshore wind and solar in AR5 and estimating £100/MWh for offshore wind (in-line with Aldersey-Williams et al 2019), the weighted average generation cost doubles from their estimate to ~£90/MWh.
Deliverability of Generation Capacity in the Royal Society Large-Scale Electricity Storage Report
Figure 6 below compares the evolution of actual installed capacity of offshore wind, onshore wind and solar to the 2050 targets set in the RS report.
Figure 6 – Actual Renewables Capacity (MW) vs Royal Society Targets
The targets in the RS report call for 112GW of offshore wind capacity shown by the green square which is more than eight times the current 14GW capacity shown by the solid green line. The dotted green line extrapolates the linear trend of installed capacity since 2009. If this trend continues, we might get to ~40GW by 2050, about 72GW short of the target. Even if the sites for these wind farms could be found, it is very unlikely that the rate of installation could be increased to meet this target, especially when one considers that most of the existing fleet will need to be replaced by 2050 too.
With a bit of luck, we might achieve their targets for onshore wind and solar. However, this requires finding sites for these developments and persuading communities to blight their local landscapes and change the use of good agricultural land from food production to electricity production.
However, this generation capacity is only sufficient to meet the relatively meagre annual demand of 570TWh using their optimistic load factors. Using more realistic load factors as discussed above would put offshore wind further beyond reach and make the onshore wind and solar targets much less achievable. To provide the more realistic amount of energy discussed above, the generation capacity will have to at least double to meet 1,081TWh of demand with realistic load factors. There is no chance at all of any of the technologies meeting those targets.
Hydrogen System Costs
Over long timescales, there are large variations in the expected output of wind and solar. This is true on daily, seasonal and multi-annual timescales. To meet demand on a minute-by-minute basis, there needs to be a large storage capacity that can be used to generate dispatchable power. The Royal Society Large Scale Storage report acknowledges there will be a need for very short-term storage in the form of batteries, possibly slightly longer-term storage in the form of Advanced Compressed Air Energy Storage (ACAES) with the vast majority of storage provided by hydrogen in underground caverns. These will be filled in years with above average supply and used up in the leaner years. They have calculated that we will need 123TWh of hydrogen storage capacity to manage these inter-year variations in supply. The calculations supporting this requirement appear to be robust, except for again, they are based upon the low overall electricity demand of 570TWh making no allowance for inter-annual variations in demand. Approximately twice the amount of storage will be required to meet the larger estimate of demand discussed above.
Capex for Hydrogen Components
The capex requirements for electrolysers, storage and generators appear to have been understated. The RS capex estimates for electrolysers of $450/kW in 2050 are at the low end of IEA predictions for 2050 of $200-900/kW. They are also far lower than the current costs of $1,100-1,800/kWh that the IEA estimates. The IEA predictions for 2050 are based on a study from 2018 which is well before the recent inflationary wave and increase in interest rates. It is therefore likely that the estimated capex requirement for the electrolysers is far too low. Even if those cost estimates are met, the average cost of the fleet in 2050 is bound to be much higher.
Similarly, the H21 report used as the source for storage capex is from 2018 so again does not factor in the inflationary surge since 2020.
The RS report assumed £315/kWe (~$400/kWe) capex for four-stroke hydrogen-fired electricity generation is much lower than that achieved in two of the non-hydrogen projects it cites. The 76MW Goodman Energy Centre project in Kansas cost $62m which gives a cost of $816/kWe in 2008 dollars, more than twice the estimate in the RS report. After the recent inflationary surge and even allowing for some technological improvement, these costs are likely higher in 2023 money. Moreover, the 2014 600MW IPP3 project in Jordan cost $800m or $1,333/kW, more than three times the RS estimate.
It is obvious that the capex estimates in the report are far too optimistic.
Hydrogen System Efficiency
There are also significant concerns about the efficiency assumptions for the electrolysers and 4-stroke engines they plan to use to make the hydrogen and generate electricity. They assume 74% efficiency for the electrolysers. The RS report itself says the efficiency of Polymer Electrolyte Membrane (PEM) electrolysers is currently 40-67% (IRENA) or 55-60% (IEA). IRENA predicts electrolysers to hit >74% efficiency by 2050 and IEA expects 67-74% efficiency by that date. It is foolhardy to expect the full 89GW of electrolyser capacity to achieve the top-end efficiency estimates in 2050. First, these are just projections, not actual measured results and second, the fleet will have to be built over a prolonged period of time so even if the units installed in 2050 achieve the projections, the average efficiency is bound to be lower. Moreover, powering electrolysers using intermittent energy degrades their performance which will lead to lower efficiencies and probably shorter useful lives. Assuming more realistic efficiencies and shorter operating lives will increase the size of fleet required and of course significantly increase the capex and unit cost of hydrogen produced.
The RS report also assumes the generators producing electricity from the stored hydrogen is 55%. This derived from a projection published by McKinsey that shows the maximum expected efficiency of such four-stroke engines might be 55% at close to full load. However, this 2023 study suggests that a 12l V12 high-compression hydrogen engine for use in locomotives might achieve a peak efficiency of 46%. The Kansas project discussed above indicates an efficiency of 44.2%. It is unlikely that the generators will be operating at optimum load conditions at all times because they will have to vary their output according to changes in demand. Again, it seems overly optimistic to assume 55% efficiency based on just one projection when others show significantly lower results. More realistic efficiency assumptions will lead to higher costs because more hydrogen will be needed to produce the required amount of electrical energy.
Finally, they plan to store the hydrogen in underground salt caverns at 300bar and assume such caverns are gas tight. This is already carried out on a small scale for short-term storage of hydrogen at chemical plants. However, hydrogen is a tiny molecule that can diffuse through most things. Even if such a cavern is gas-tight for methane or air, it is difficult to believe that such caverns will be able to seal hydrogen at such high pressures for up to a decade without some leakage. This study from Gaffney Cline suggests leakage rates in the range 2-18%. However, the period over which that leakage is measured is not clear. They do suggest that the risk of leakage from salt caverns is lower than from other rocks such as depleted gas fields.
If there is any leakage at all, and there is bound to be, that will reduce overall system efficiency and lead to increased costs as well as potential safety concerns.
Cost of Capital
Throughout the report, they assume a default cost of capital of 5%. With the Bank of England base rate currently sitting at 5.25%, this is a risible assumption. They also discuss the impact of a 10% cost of capital. This increase in interest rates leads to the costs of making, storing and burning hydrogen going up by ~50% and pushes up the cost of ACAES significantly.
The technologies to be used in the proposed electrolysers, storage facilities and generators is immature and the planned load factors are very low. Therefore, even a 10% cost of capital is probably not enough to compensate for the level of risk being taken. An estimate of 11% current cost of capital for offshore wind was derived from the premium over long bond rates in the Government’s different Generation Cost reports. Offshore wind is a relatively mature technology whereas these hydrogen technologies are not. It would not be surprising to see investors demanding returns of 15% or more before supporting such projects. Of course, this would push the costs up even more dramatically, probably more than doubling their estimates at 5% cost of capital.
Of course, increased interest rates also push up the costs of wind and solar generation, but they have already been accounted for in the discussion above.
System EROEI
One thing missing from the Royal Society Large Scale Electricity Storage report is any discussion about Energy Return on Energy Invested (EROEI). The importance of EROEI is discussed here. Weissbach calculated the EROEI of various generation technologies in his seminal paper from 2014. Wind without backup had an EROEI of ~16 and solar at German latitudes 3.9. He then adjusted these figures to take account of the buffering or storage required to enable these technologies to deliver power on demand. The buffered EROEI of wind and solar was calculated at 3.9 and 1.6 respectively. The buffering technology he used was hydro power. There is no data specifically about the EROEI of wind and solar buffered by hydrogen. There is reason to believe it maybe even lower than Weissbach calculated because the embedded energy in 89GW of electrolyser capacity, 123TWh of storage caverns and 100GW of hydrogen-fuelled generation capacity will be very large and these systems will not generate any more net energy from the primary wind and solar sources.
Using Weissbach’s calculated buffered EROEI figures for wind and solar, the weighted average EROEI for the whole system is around 3.8. This and estimates of the EROEI of the grid in 1998, 2008 and 2021 as well as the Leading the Way scenario in the latest National Grid FES report and the nuclear dominated plan for 2050 are plotted on Figure 7 below.
Figure 7 – Royal Society Plan Falls Down the Energy Cliff
As can be seen, the Royal Society plan takes us a very long way down the energy cliff, where we are spending more than a quarter of our gross energy to produce the net energy we need to live. This is well below the economic threshold of seven assumed by Weissbach. This alone should consign the Royal Society plan to the dustbin of history.
Overall Costs Understated
Section 8 of the report pulls it all together and arrives at estimated overall system costs of electricity in 2050 using wind, solar and largely hydrogen storage supplemented by 15GWh of battery storage to maintain grid stability as shown in Figure 8 (their Figure 24).
Figure 8 – Overall Costs of Energy Projections from the Royal Society
This results in an estimate of the full system costs of electricity at ~£52-62/MWh with a 5% cost of capital and the weighted average cost of base wind and solar generation in 2021 prices of £30.20/MWh. At the top end of estimates, full system costs are in the range ~£78-92/MWh with a 10% cost of capital and base generation costs of £45/MWh. The 10% cost of capital does not seem to have been applied to the weighted average cost of the base renewable power.This report essentially says the full system cost of electricity including all the base renewable generation, hydrogen electrolysis, transport, storage, backup generation, transmission and batteries will be less than the costs achieved in AR5 in most scenarios and in most cases, cheaper than gas-fired generation today. It is a fantasy.The models they use are very complex and it is too difficult to propagate more realistic assumptions on extra capacity, increased capex, lower load factors, higher leakage rates, lower efficiencies and higher interest rates throughout. Realistic costs of the base renewable generation would double the starting baseline of £45/MWh and more realistic assumptions about the true cost of hydrogen production, storage and generation would likely at least double too. It is not too much of an exaggeration to say the actual costs would be at least double the numbers they estimate for a 10% cost of capital and £45/MWh renewable generation. This would put the total system costs over £180/MWh.Even that would be undeliverable because there is very little chance of expanding offshore wind generation at the rate required.
Human Factors
Aside from the technical and financial flaws in the Royal Society report another set of considerable difficulties need to be overcome, namely the human resources required to deliver the engineering reality. Each billion pounds of project costs will require approximately 1,000 person years of professional engineering time. Most of these engineers will have to be home produced because we cannot take them from their home countries where they will be needed to reach their own net zero targets. The materials requirements for the global net zero project will require more than a tenfold increase in the mining of key materials (including the rare earth metals) requiring even more professional engineers. The sequencing of the projects is critical, as this extra electricity needs to be available at least as fast as the deployment of electric vehicles and heat pumps. Finally, all this needs buy-in from the public, and for a start, the planning delays will thwart even the start of the projects.
Conclusions
The starting point for the Royal Society Large-Scale Electricity report is Government and NGO plans for an energy scarce world in 2050. The evidence from Our World in Data shows this will likely lead to lower GDP per capita and thus lower living standards which is clearly an undesirable outcome. This base assumption is then buttressed by flaky Government estimates of the future cost of renewable energy. These estimates are based on unrealistic assumptions of turbine costs, load factors and the costs of capital.The report then adds its own unrealistic assumptions about the cost and efficiency of electrolysers, storage and generation technologies and its base case uses a risible 5% cost of capital. Even their 10% cost of capital sensitivity analysis is probably too low. In essence the report expects us to believe we can deliver lots more renewable energy and a complete hydrogen ecosystem in 2050 for about the same as the cost per MWh of renewables in this year’s AR5.Even if it were deliverable, we would end up with an energy system near the bottom of the energy cliff producing about half the energy we need to run a modern society. It is simply not credible.The RS report shows the dangers of “official” figures propagating from one institution to another in a daisy chain. The thing is daisy chains are pretty but very fragile. Hopefully, this article has exposed that fragility and demonstrated the extraordinary evidence required to support their extraordinary claims is simply not there. Quite the contrary, there is a plenty of evidence that their claims are a fairy tale. The Royal Society report shows that their vision of 2050 does not quite violate the first law of thermodynamics, but it goes on to break all the basic tenets of sound engineering. Because the RS report also effectively rules out batteries as the energy storage medium to support intermittent renewables, the entire renewables project should be scrapped.
As a meteorologist I find it frustrating that every extreme weather event is considered a reflection of “a “new normal” due to the effects of climate change”. As a pragmatic environmentalist, it is even more frustrating when a report comes out criticizing New York’s infrastructure resiliency to minimize the effects of extreme weather but fails to pick up the tradeoffs between resiliency infrastructure investments versus reducing greenhouse gas emissions that will supposedly prevent extreme weather. This article describes an example of this dynamic: the New York City Metropolitan Transit Authority (MTA) extreme weather resiliency plan and recent flooding in New York City.
“Friday’s deluge dropped 8.05 inches of rain at JFK Airport, making it the wettest day on record, beating Hurricane Irene’s daily record set back on Aug. 14, 2011, the National Weather Service said. Widespread rain totals of 4 to 6 inches were New York City, Long Island and Hudson Valley, with locally higher amounts in excess of 7 inches of rain.
Tony Heller does a great job documenting historical accounts of extreme weather events. He found that on October 8, 1903 New York received 10.04 inches of rain.
Ryan Maue checked out the Central Park precipitation data and found that on September 23, 1882 the site measured the highest daily value of 8.28” and that this recent event was the 9th wettest day at that site.
Nonetheless, it did not prevent the usual suspects, including Governor Hochul from blaming climate change: “This is unfortunately what we have to expect as the new normal”. She also described the storm as “Mother Nature at her most powerful.” “This was the kind of rain that was once unimaginable — we called them once-in-a- century storms,” Hochul said Saturday. “But this is the third time since I was sworn in two years ago, I’ve had a once-in-a-century storm.”
Of course, this storm will also be used as more justification by the same crowd to justify implementation of New Yorks Climate Leadership & Community Protection Act (Climate Act) net-zero transition. Because it is generally accepted that climate change caused by GHG emissions did not kick in until after 1950, the higher historical precipitation in 1882 and 1903 conclusively falsify the Governor’s “new normal” and the idea that GHG emission reductions can prevent further similar storms.
MTA Climate Resilience Upgrades
Flooding caused major disruptions to New York’s subway system, according to the Metropolitan Transportation Agency. The flash flood caused “full or partial suspension of service on half the lines in the system, with MTA officials saying full service was restored by 8:30 p.m after 20 million gallons of water were pumped out of the subway”. On a personal note, the subway closures forced my grand-daughter to stay with a classmate in Manhattan rather than going home to Brooklyn that day.
A couple of days earlier, the MTA published a 20-year needs assessment report that said “Some 400 miles of subway tracks, half of Metro-North’s Hudson Line and several Long Island Rail Road stations are in dire need of upgrades to stave off flooding and other extreme weather exacerbated by climate change.” The Resilience Improvement weblink states:
Climate change is here—and we must prepare. Over the next two decades, climate change projections indicate that the New York region will experience more frequent and intense coastal storms, more than twice the current number of torrential rainfall events, and triple the current number of extreme heat days over 90 degrees. Meanwhile, sea levels will rise approximately 2.5 feet by the 2050s and almost 5 feet by the 2080s.
Our infrastructure was not built to withstand future climate conditions. We’ve made significant progress retrofitting, renovating, and rebuilding infrastructure in anticipation of future climate conditions, but climate change won’t wait for us to finish. For our systems to keep running as lifelines through the coming climate-induced crises, we must move faster.
To determine whether the Metropolitan Transportation Authority (MTA) – New York City Transit (Transit) identified potential damage to its system and developed plans to mitigate the effect of extreme weather conditions and flooding. We also determined whether the MTA tested/updated the plans and inspected and maintained the equipment to ensure they can be deployed when needed. Our audit covered the period from April 2009 to August 2022.
The key findings of the report include the following:
To date, the MTA has not implemented one of the most important recommendations of the 2009 Report – the development of the climate change adaptation master plan. Since Superstorm Sandy, Transit has assessed and identified areas of its system that are at risk of flooding from extreme weather events and developed and carried out capital projects to both correct damage caused by Superstorm Sandy and mitigate potential flooding conditions in the Transit system. Further:
Our review of a sample of 23 of 221 capital projects intended to correct or prevent damage found that projects were often incomplete in scope of work, not finished on time or within budget, or insufficiently documented. Just two of six critical stations that Transit indicated should have been made more watertight and resistant to potential flooding were completed in one project we reviewed. Another project was initiated to prevent flood water from entering 14 fan plants; however, only 11 fan plants were mitigated. Transit officials stated the three remaining fan plants were completed but did not provide documentation to support their statements. (Fan plants are facilities with large vent gratings and fans located atop shafts connected to the Transit tunnels.)
Transit did not sufficiently document inspections of individual pieces of equipment. Instead, it reported more broadly by subway stations or by rooms in off-site facilities that were inspected. In one instance, because not all rooms were inspected at a facility, we were able to determine that 51 of 72 pieces of equipment in our sample were not inspected between January 2021 and August 2022.
While Transit has developed winter, hurricane, rain, and extreme heat plans, we found that these plans were inconsistently activated, with no documentation explaining the rationale for decision making. In our sample of 18 weather events, plans were not activated for six events that included tropical storms, hurricanes, or coastal flooding.
I support the concept to identify and address potential flooding conditions. My problem with this report is that it does not recognize the differences between weather and climate, namely weather is going to cause flooding conditions whether or not climate change exacerbates the impacts. It seems that climate change must be included as part of the marketing to get support for the audit.
Discussion
Response to the 20-year plan included the concern by advocates that no costs were attached to the plans for the improvements that MTA says is necessary. For example:
“While the MTA’s needs assessment is thorough and shows that our transit system is in dire need of investment, it lacks dollar figures showing exactly how much money will be needed to fix the subways, buses, and commuter railroads,” wrote Rachael Fauss with the good government group Reinvent Albany in an email. “The needs of everyday riders must come first. In an environment of limited resources, it is essential that we prioritize capital projects based on objective measures of need, not politics, to repair the subways, buses and commuter railroads and ensure that they continue to best serve New Yorkers in this era of climate change.”
I think it is important to consider whether the net-zero transition GHG emission reduction measures in New York State will have any material effect on the extreme weather events that caused the problems observed during the latest flash flood. The answer to that question is no. As noted previously, the fact that there were days with greater rainfall before GHG emissions allegedly became the driver of observed global warming suggests that GHG emissions reductions would have to go to pre-industrial levels to just keep rainfall rates at the same level as 1882. That is clearly an ambitious target even if you believe that GHG concentrations are a driver of extreme weather and I don’t believe that. It gets worse. New York GHG emissions are less than one half of one percent of global emissions and global emissions have been increasing on average by more than one half of one percent per year since 1990. Even if GHG emissions in New York were to get to zero, that reduction will be supplanted by increases elsewhere in less than a year.
Conclusion
One of my pragmatic principles is Russel Schussler’s observation that “We can do almost anything we want, but we can’t do everything”. In this instance the costs of the Climate Act’s net-zero transition should be considered relative to the MTA plan. The upgrades necessary to prevent extreme rainfall events and storm surge from flooding New York’s subway system will be enormous but at the end of the day those investments would have a measurable effect. In order to get to net-zero, the costs will be an order of magnitude greater than “enormous” with no hope for a measurable effect on severe weather. I agree with Rachel Fauss: “it is essential that we prioritize capital projects based on objective measures of need, not politics”.
The disconnect between MTA, the media, and even Fauss in this example is frustrating. For example, Rachael Fauss noted that the investments are necessary “in this era of climate change” misses the point that climate is what you expect and weather is what you get. Climate change had very little effect on this event and certainly not enough to cause the storm or materially change its impacts. Ultimately, throwing away money on a pointless virtue-signaling net-zero transition will likely forestall the investments needed to maintain and strengthen the resiliency of the subway system. Reducing New York GHG emissions in a quest to minimize extreme weather issues in New York is not going to work and will be counter-productive for real solutions.
Roger Caiazza blogs on New York energy and environmental issues at Pragmatic Environmentalist of New York. He blogs about the RGGI program because he has been involved with it since its inception and nobody else apparently wants to review it. This represents his opinion and not the opinion of any of his previous employers or any other company with which he has been associated.
.jpg){kind=link}
.jpg){kind=link}
You must be logged in to post a comment.