|
Below are a few letters we received on topics that appeared in the
past few weeks. They capture the essence of how many readers say they feel.
Solar
Systems Never Cheaper - September 16, 2009
I always enjoy reading the Insider so I was happy to see
your piece titled "Solar Systems Never Cheaper" addressing the
rapid decline in module prices our industry has seen in the last year.
However, there were a couple of items in the piece that I thought were
worth responding to for clarification.
First, I think it's worth pointing out that the solar
"industry" should be seen as a value chain that extends far
beyond upstream module manufacturers. It rightfully includes developers,
financiers, EPCs, utilities, and IPPs who build, own, and operate PV power plants. While
the decline in module prices may be an unwelcome trend to manufacturers, it
has been positively received by just about everyone else in the downstream
value chain. I think a better way to describe the current situation is that
we're shifting to a phase of the silicon commodity cycle that favors
developers and owner/operators over manufacturers.
At today's module prices, we can offer solar-generated electricity
on terms that are now truly competitive. So it struck me as odd to hear you
say that the "industry" was troubled by module price declines in
much the same way it would be odd to hear someone say the energy industry
might be troubled by declining natural gas prices. It all depends on where
you sit in the value chain and how the change in a feedstock impacts your
profitability.
The second item that I felt needed to be addressed was your
assertion that module prices were "not coming down because
manufacturers are increasing their efficiencies and improving their
economies of scale." Modules are a commodity and their prices are
clearly set by the dynamics of supply and demand. Over the past couple of
years, generous feed-in tariff programs (particularly in Spain)
created demand that allowed manufacturers to sustain high module prices. So
you're right to point out that one factor in the current price decline is a
reduction in global demand due to the pullback by Spain and
the financial crisis has slowed construction and orders.
However, there have been significant changes to the supply-side of
the equation as well. The reality is that the last few years' high prices
concealed very real investments in efficiency and cost improvement by a
number of upstream players -- not to mention a huge investment by silicon
suppliers in increased capacity. The increase in manufacturing efficiency
and capacity will inevitably result in an equilibrium price that is lower
than it was in years past. In the current environment, only those whose
cost structure is sustainable at today's prices will be able to grow and
expand the market.
PV is not inherently expensive. Prices are receding because some
overly generous incentives have been removed AND today's prices now reveal
how low the real marginal cost of production has come as a result of
investment and expansion. Those reduced prices are now fueling a massive
surge of development behind the scenes that will soon result in much larger
scale deployment of PV in the US. On balance, I think that's
a very good thing for the U.S.,
for ratepayers and the "industry."
Arno Harris
CEO
RECURRENT ENERGY
Right-Sizing
Nuclear Power - September 18, 2009
If it sounds too good to be true, then it usually is false.
Right-sizing of nuclear units is an update of 1960s plan for small
reactors on barges to serve cities and coastal areas. Standard designs
using existing technologies, no siting issues,
construction and operating costs below large units and coal or gas units.
The added promise of unlimited self-generating fuel is a new promise, but
would seem to violate the rules of physics and commerce.
Sam Herndon
Do you think any developer could afford the rigors of licensing a
small nuke? How much difference do you think would ultimately be involved
in licensing a 100 MW plant as opposed to licensing say a 2500 or 3000 MW
plant? Does anyone in the industry have any idea of the costs involved in
just getting a nuke facility licensed even within a factor of 10? This was
difficult 40 years ago. Does anyone think it would be less difficult or
less costly today?
Joseph Langenberg
The other advantage of small nuclear reactors is that they are
well suited to smaller economies.
For example when nuclear power has been suggested for New Zealand
the response has always been that you need two reactors to keep one running
while the other has down time and two standard reactors provide more power
than we currently use -- in total.
These smaller modular reactors solve that problem by being smaller
and modular.
This is a great advance for small nations such as the Pacific Islands,
and remote areas within places like Australia.
Owen McShane
Director
Centre for Resource Management Studies
New Zealand
We have heard this before "power so cheap we will not have to
meter it". Come on guys, every time the nuclear industry says it can
build something for a given price the final price is one order of magnitude
higher. Just look at the cost of the base-load plants estimated to cost $1
to $2 billion in the early Bush administration are now in the $8 to $10
billion range now and construction has not even started. The 100 to 300 MW
plants will cost $3 to $5 billion each not $300 to $500 Million each.
If these right-sized plants are so cheap, why are the U.S.
applications for bigger ones? I would think they would build ten on one
site if the total cost was lower than one big. They understand economics I
hope.
Fool me once shame on you. Fool me twice shame on me. This is
voodoo. Let's not waste our time and research dollars on it and spend the
money wisely on energy conservation and renewable energy.
Scott Greenbaum
In the 1980s, considerable R&D was funded by the DOE on a
small modular high-temperature gas-cooled reactor (MHTGR), and done by
General Atomics, GE, Bechtel, Combustion Engineering, Oak Ridge National
Lab, MIT, and many U.S.
utilities. Germany
had a similar R&D effort.
Because of the use of helium coolant, silicon carbide clad fuel
pellets and graphite moderator, the MHTGR could be operated at very high
temperatures, e.g., 1000 C, much above the maximum operating temperature of
a water cooled reactor, thus enabling high thermodynamic conversion
efficiencies to electricity using steam or Brayton
gas turbine cycles alone or combined, and many process heat applications,
e.g., hydrogen production. It also exhibited inherent passive cooling for
emergencies.
A construction design objective was to be able to make it in a
factory, hence the term "modular." A regulatory design objective
was to enable factory safety certification before the reactor was shipped
to its site.
As someone who once took people on tours of an operating HTGR, I
was particularly impressed by its radioactive cleanliness, a result largely
because of the fuel pellet design and the use of the helium coolant. We
could walk in street clothes anywhere in the reactor building even while it
was operating, something that can't be casually done in other reactor
concepts.
Merwin Brown, PhD
Director, Electric Transmission Research
California Institute for Energy and Environment
University of California
Woody
Biomass' Potential - September 23, 2009
While there may be adequate wood currently available in many
states at the current time, the central issue is that biomass combustion
using wood is not carbon neutral, especially in a time frame that will make
a difference to slow or improve climate change.
Burning wood is dirtier than burning coal -- per megawatt hour it
releases more CO2, more particulate, and more NOx.
Moreover, every CO2 molecule in the atmosphere has the same effect
as every other molecule, regardless of the source. Therefore, just because
wood is a renewable source does not mean it is clean. The current science
is overwhelming that in the first two decades newly planted trees do not
sequester CO2 at a rate which "makes up for" the burning of
mature trees/tree products. This has been clarified by the EPA on page
18899 of the Federal Register where the statement is made that "...
half of all carbon currently emitted [and emitted in the future] will take
hundreds to thousands of years to reabsorb."
Put another way while the CO2 reduction target for 2020 in the
ACES bill is 17 percent, if biomass CO2 emissions continue not to be
counted as is currently the case and is continued under the proposed
legislation, the resultant CO2 emissions will change the cap reduction to
less than 11 percent according to EIA data.
Incentivizing dirtier energy with billions
of taxpayer dollars does not make sense.
At this point we would be better off burning coal and using the
money under ARRA and in the 2005 and 2007 Energy bills, as well as the new
proposed legislation, to further research into more durable wind turbines,
more efficient/cheaper solar panels, and implementation of the smart grid.
Dr. Bill Sammons
Co-firing systems range in size from 1 MW to 30 MW of bio-power
capacity. When low-cost biomass fuels are used, co-firing systems can
result in payback periods as low as 2 years.
A typical coal-fueled power plant produces power for about
$0.023/kilowatt-hour (kWh). Co-firing inexpensive biomass fuels can reduce
this cost to $0.021/kWh, while the cost of generation would be increased if
biomass fuels were obtained at prices at or above the power plant's coal
prices. In today's direct-fired biomass power plants, generation costs are
about $0.09/kWh. In the future, advanced technologies such as
gasification-based systems could generate power for as little as $0.05/kWh.
For comparison, a new combined-cycle power plant using natural gas can
generate electricity for about $0.04-$0.05/kWh at fall 2000 gas prices.
Conversion of older coal plants to fire biomass offers viable and
cost-effective alternatives to retrofitting FGD and SCR systems. For
example, Ohio Edison Company, a subsidiary of FirstEnergy
Corp., has agreed in a consent decree to repower
the R.E. Burger Units 4 and 5 near Shadyside,
Ohio with biomass fuel. The
modified consent decree will substantially reduce emissions of SO2 and NOx from Burger's current levels and also reduce carbon
dioxide (CO2) emissions from current levels by more than 1.3 million tons a
year. Burger will be the largest coal-fired electric utility plant in the
country to repower with renewable biomass fuels
and the first such plant at which greenhouse gas emissions will be reduced
under a Clean Air Act consent decree.
Dr. Richard W. Goodwin, PE
Environmental Engineering
Consultant
I agree with biomass being carbon neutral as opposed to coal, but
why put the carbon back into the atmosphere? The use of hydro, solar and
wind produce electricity without releasing carbon dioxide. We can argue the
point that the fore mentioned renewables are
carbon neutral as well. I like the potential of all renewable energy sources,
but I would rather not do "in with the good, out with the bad"!
Kurt Branthover
Principal Engineer
PB Asia Ltd.
Promoting using biomass in a condensing power system at something
less than 30 percent energy conversion such as this project is not the best
use of this renewable, but not unlimited, resource. Sweden and the rest of
Scandinavia realizes this, generating and using most of their biomass
energy in pulp and paper mills and district heating systems, often
connected together.
Society would be much better served by reserving wood-based
biomass for 75 percent cogeneration or small heating systems in homes,
schools or commercial business using high efficiency wood stoves or even
higher efficiency pellet stoves.
Chuck Hartley, PE,
CEM
Pursuing
Intelligence - September 25, 2009
The concept is good but the cost is excessive. The Delaware
Electric Cooperative sends out an email. This is simple and cheap thinking,
not complicated and costly. The Delaware
all-in cost of electricity is 40 percent cheaper than JCP&L in New Jersey.
Michael J. Edwards
Belyea Co. Inc.
With regards to the article "Pursuing Intelligence"
dated September 25, 2009, I feel the biggest issue in "Smart
Grid" development is the hard sell many AMR/AMI companies and
interested parties are making for customer premise data exchange. Any
logical person would realize that the few dollars worth of savings
represented in customer premise solutions do not begin to justify the
amount of tinkering you have to do with "smart appliances". I am
not sure most Americans would spend more than a second on trying to save a
couple dollars a month. Most don't even turn off many of the appliances
that draw energy during their "standby" modes -- a significant
chunk of the current demands on our systems. Never mind the cost to upgrade
what might be a perfectly good appliance for one that is typically more
expensive and will not be able to realize the additional cost in any
savings it may provide.
What we have been missing as an industry is the fact that there is
much to be gained by improving the overall performance of the energy
delivery system. Where investments are most needed is in the automated
control of voltage levels, VAR compensation, and even the balanced loading
of stations and related equipment and transformers. Savings can be in the
range of 10 to 20 percent which can often pay for simple projects within
the first year of operation. Sometimes, by shooting for the stars, we are
missing the beautiful clouds in the process. Small investments can often
yield much greater returns.
I find it interesting that the consumers in Colorado are all of a sudden not
registering any complaints for "low-voltage lighting issues".
Perhaps this is due to the amount of education that may have gone into
implementing the program rather than the program doing anything beyond
ordinary. For instance, most "low-voltage" complaints in our
local area were often due to a lack of understanding of how the system
works and its capabilities. Often, the complaints were related to the
normal operation of large appliances which will create a momentary low-voltage
condition (visible through incandescent lights) due to the inrush current
required to start the appliance. Lacking any data comparing how a simple
educational program versus a "Smart Grid" program would have
done, I find it hard to simply credit "smart technologies" for
this change.
There is no question that adding intelligence throughout the
system will yield a wide range of benefits. The question remains at what
cost (or benefit). There are many utilities in the U.S.
(mostly municipally or public-owned) that still don't have a simple SCADA
system. Many cannot afford this type of investment yet people have sold
them on customer premise technologies that should be the last item on the
list of conservation strategies -- the payback is not as large as other
automation strategies. At the same time, I believe much more significant
investments in renewable technologies, feed-in tariffs, and other methods
of encouraging conservation and alternative clean energy sources is sorely
needed. These investments now will yield better pricing and improve
technologies later.
In the meantime, the utilities will continue to focus on the
flavor of the day -- how to communicate energy pricing to me. What I find
interesting is that I really don't need the utility to send me a message of
when the power is cheaper -- in fact, this is most often rather obvious --
in the middle of the night when nobody is awake or using anything -- the
law of supply and demand. So, why would the utility want to spend hundreds
on letting me know what is already obvious? Still, when it comes to doing
the right thing for efficiency's sake and the environment, there will be
some investment involved. I think the investment will be best done through
retrofits during normal replacements (like from outdated equipment) and
inclusion of the technologies on new installations.
Luis G. Vargas, Jr., PE
Sr. Director of Energy Services - Southeast Region
Engineering Director - Tampa
Office
Return to Environmental Update
Return to Homepage
Roubidoux
True tales of the Huckleberry Finn type adventures of a boy who journeys from
delinquency in California to Southern culture in the Missouri Ozarks. Although told
through the eyes of a twelve year old who never grows old, much of the real life
adventure is emotionally timeless with appeal to all ages. Brutally honest at
times but never off colored.
A sample from Roubidoux may be read here.
The book may be ordered here.
Do you know that your body is naturally acidic which makes you susceptible to all manner of unhealthy conditions and illnesses? By making your body alkaline instead of acidic you mitigate these potential health problems. One way of doing this is to drink alkaline water. The above machine is called the "Athena" and makes tap water into pure, clean alkaline water. It's rather expensive, but it's the best in the world. Isn't your health worth it?
Click here to learn more and order it.
Want to live clean without exposing yourself or your family to hazardous chemicals? Miracle II
soap is all natural and contains no hazardous chemicals. You can clean anything with it, including your body. A capful of it in the water each time you bathe will guarantee you will never see another
scum ring in your tub, to say nothing of the infinitely more dramatic beneficial
effects attested to by a multitude of Miracle II users throughout the world. From the mundane to the sublime, Miracle II works!
|