There are no shortage of skeptics out there, even some among environmentalists and clean energy advocates, who are unconvinced that renewable energy can ever be the dominant–perhaps even sole–source of electricity generation.
The reasons for this skepticism vary. Some, for example, argue that the land needs for sufficient generation of wind and solar power are too great. This turns out to be an incredibly lame argument, but that’s the subject of a different article.
More frequent are the arguments that “baseload” power–large power plants that tend to run 24/7–are necessary to ensure reliable electricity and that the variable nature of some renewables–solar and wind–can’t provide that reliability. Then there’s the notion that the electrical grid can only accommodate a certain level of renewables, around 30-40%. Above that and the grid pretty much breaks down. These arguments are actually related and solved in the same way.
More recently, an argument has been circling among energy nerds–especially pro-nuclear energy nerds–that the integration of renewables into the grid reaches a peak for economic reasons: that renewables are limited by their cost. Not by their high cost, but by their low cost, or as one writer put it: solar and wind eat their own lunch. But that merely shows that not only must the technical nature of the grid change, and it can; but so must its economic nature, and it can too.
The electric grid in use today was mostly designed in the 20th century. Large baseload nuclear and fossil fuel plants were built, usually far from the largest electricity consumers (cities and large industry), and transported by huge (and not particular efficient) power lines. Those baseload plants had, and have, high capacity factors and run pretty much all the time, although nuclear reactors have to be shut for refueling for a few weeks every 12-18 months. Utilities try to arrange those shutdowns to occur during periods of low demand. During peak power needs–hot summer days in most of the country–smaller gas plants and in the old days even oil plants would be fired up to supplement the baseload levels.
And it all worked pretty well given the technology available at the time.
But, as we all now know all too clearly, that system had a price–a price not reflected in the cost of electricity. That system was and is killing us. Those large nuclear and fossil fuel plants are spewing out carbon dioxide and radioactivity and creating large quantities of dirty and deadly waste products that society doesn’t know what to do with.
Had the cost of those effects–which do have a price, a steep one–been incorporated into the price we and our parents paid for electricity, we probably would have moved to a clean energy system much faster. As it is, we no longer have much of a choice.
Fortunately, as is being proven daily in Europe, a grid based on smaller, distributed variable power sources can be just as reliable, and even more resilient and secure, than a grid reliant on baseload power. Variable does not mean unreliable: as long as it can be reliably projected with sufficient advance time what the wind will do and thus how much wind power will be available where, and the same for the sun, then a variable grid can be highly reliable. And those can be and are, in fact, reliably projected.
The ability to integrate a moderately large amount (say 30-35% or so) of renewables into a baseload-dominated grid is a given. It is happening daily. Not so much in the U.S., although even here states like Iowa are getting more than 20% of their power from renewables, and the percentage of renewables is set to rise rapidly–both on their own for sound economic reasons and due to encouragement of them in the Clean Power Plan.
But at some point above 35-40% renewables or so, a conflict arises. If more renewables are to be brought into the grid, the large baseload plants have to begin closing–even if they theoretically remain useful. That’s because the kind of grid that works for the variable renewables–a fast, nimble grid where power from different sources scattered in different locations can be ramped up and down quickly depending on where it is being generated and where it is needed–doesn’t work well for baseload plants, especially nuclear reactors, which cannot ramp up and down quickly. Those kinds of plants were designed to run 24/7 and that’s what they do–they’re not designed to fit in with a grid that doesn’t want them to run 24/7, that instead wants them to run when their power is needed. And the higher the penetration of renewables, the less the baseload plants’ power is needed.
Add in energy storage, the new kid on the block, and polluting power plants running 24/7 become an anachronism. When the variable sources aren’t generating what is needed, just release the stored, and cheaper, electricity they generated earlier during periods of low demand. The polluting baseload plants then make no sense at all. Why throw carbon dioxide into the air and tritium into the water and generate lethal radioactive waste just to keep dirty and usually more expensive power plants operating just for those few hours in the week when they might be useful? With storage, they’re not needed, or even particularly useful, at all.
What’s stopping us, or slowing us anyway, is not the technology for the new grid–that exists. It’s the rules. And the political will to transform the grid to accommodate the transformative technologies that have been developed over the past two decades. If we’re going to move into the 21st century, and with nearly 15% of the century already gone we’re a good ways into it, then we’d better get moving quickly. The old rules need to be changed; David Roberts, formerly of Grist, has compiled a useful list of some of those needed changes.
One problem, obviously, is that utilities don’t want to close their old baseload power plants if they are still useful at generating electricity. They want to put off that retirement date as long as possible. Assuming its operating and maintenance costs are not so high that it loses money, the longer a power plant runs the more profit it returns. And utilities are about making money, not transforming the grid.
In the U.S., at least, we’re not at the point where profitable baseload power plants have to be forced closed for the greater good–renewables don’t yet make up enough of our power to require that step. But parts of Europe are quickly getting there, and we in the U.S. will get there in many places faster than most people now think–surely within the next decade. Germany is already showing that a grid with a high penetration of renewables can be reliable, and that forcing reactors to close can not only be publicly acceptable, it can attain wide public support. The larger problem in Germany these days is not the amount of renewables in place, it’s that there is so much renewable generation that the grid needs to be strengthened to better distribute that electricity across the country and for export to nations like Poland and Austria–which badly want that cheap, clean power. Public opinion polls suggest that in the U.S., a similarly high penetration of renewables will be most welcome, even if anti-nuclear sentiment is not at German levels.
Perhaps forcing reactors to close won’t be necessary; enough are already unprofitable, and more are likely to become so in coming years that perhaps they will simply shut down, be replaced by renewables and it will all happen quietly and happily. More likely though, as nuclear utilities contemplate 80-year operating licenses and squeezing every last watt of power out of them regardless of their age or safety condition, that could become the nuclear issue of the next decade for the public, state regulators and policymakers and the like: should existing reactors stay open when they’re still viable or be forced aside to welcome larger amounts of cleaner, safer and usually cheaper renewables? From our perspective, the answer is obviously yes, they should shut down to make way for the more modern system. But that’s an answer that will take a lot of preparation and groundwork beginning now, because the nuclear utilities will fight that hard.
That’s a somewhat different issue than the one that confronts us today, which is should uneconomic reactors stay open or move aside for renewables? The nuclear utilities want the ground rules changed to force ratepayers to keep those uneconomic reactors open regardless of their cost. That’s an easy argument to make: of course the rules shouldn’t be changed to favor the higher-priced, dirtier power source. And it appears that argument is on the verge of victory in Illinois–the most nuclear state in the U.S. If that argument does end up carrying the day there, it can everywhere.
As for the notion that solar and wind are too cheap, that just shows the absurd nature of the economics of electricity and the failure to consider external costs–the environmental damage they cause and the full lifecycle costs of their existence–in the economic equation. There is more to life than the dollar, though you wouldn’t know it by how many traditional markets work, and, in fact, we have reached the point that unless “more to life” is adequately factored into prices, there may not be any life at all.
The concept being bandied about by these pro-nukers is that if there is “too much” solar and wind in the system, its price will eventually become zero–essentially free. And at that price–or no price if you will–the system breaks down and there will be no more investment in solar and wind. Who would want to invest in it if you have to give it away?
There are ways around the problem even under the existing system, from feed-in tariffs to Power Purchase Agreements. And the “problem” itself still has at its foundation the baseload concept of electricity generation and distribution. Absent those baseload plants, which only inhibit renewable generation anyway, there cannot be “too much” renewables in the system. But including the real costs of nuclear and fossil fuel use would be the best step. Because once added in, those costs make that kind of generation too expensive to use no matter what the competition. And if the only choice is low-cost to zero-cost renewables, well, certainly consumers wouldn’t mind.
In the real world, rather than abstract economic modeling scenarios, electricity is a necessity and it will be provided. But in the real world, in the new world of the 21st century electricity grid, it may well be that electricity itself will not be as profitable to generators as it was in the 20th century. Energy efficiency is reducing demand and that, despite a growing population and even with economic growth, is a trend that will continue and probably accelerate (Maryland, for example, has set a new policy of reducing demand by 2% every year). Renewables act to drive down electricity prices. Certainly the idea that individual utilities, or even a consortium dominated by a single utility (a la Vogtle or Summer) will ever again build mega-billion dollar power plants of any kind just in order to sell electricity, is a relic of the 20th century playing out today as farce. It won’t be playing out much longer. Utilities, like Virginia’s Dominion, that may think that obsolete model still applies, will regret it.
Electricity may never be free, or too cheap to meter, but it may well become one of life’s little bargains. Long distance in my lifetime has gone from an expensive luxury item rarely used; to an inexpensive, frequently-dialed option; to a free add-on to both my landline and iphone plans. For my millennial kids, the concept of a “long-distance” call is meaningless: they’ve never made one and never will. But they do still use phones, and all the services modern phone plans offer.
The costs of electricity are going to come down too–technology and renewables are already starting to see to that–but someone, whether it be the traditional utilities or someone smarter is going to come along and figure out how to make money by providing electricity add-ons and services, even if the electricity itself is free or nearly so. Totally free electricity may be too much to hope for, there is a grid to pay for and maintain after all, and there will be for the foreseeable future. But the money to be made will be in the add-on services, not the basic electricity.
The solar rooftop people have pretty much already figured this out for their slice of the business–whether by lease or purchase, you pay primarily for the equipment, installation and maintenance, not so much for the electricity. But since rooftop solar doesn’t work for everyone nor everywhere, there is a market ready for something new and safe and clean and that won’t destroy the planet we live on. I’d say that’s a pretty damn large market looking for the electricity equivalent of long-distance in the iphone era. With a market like that, someone is going to deliver, even if the electricity itself is little more than a low-cost add-on to other services people want.
That won’t happen tomorrow, of course. As Barry Cinnamon of The Energy Show podcast put it, “But this change in our energy sources will take many years, just as the complete transition from ‘horse and buggy’ transportation to gas-powered cars took 50 years. As with other large-scale technological changes, customer economics will force the current incumbent energy providers to change (unlikely), or go out of business (more likely). It’s a virtuous cycle as more customers are satisfied with renewable power generation, and more people are employed in these industries.”
For nuclear power though–even for “small modular reactors” (which actually are not so small, most are much larger than the early U.S. commercial reactors like Big Rock Point and Yankee Rowe and some are as large as Fukushima Daiichi Unit-1)–and fossil fuels as well, the transformation means extinction. By definition, SMRs are also baseload power plants; despite being smaller than today’s behemoth reactors, they are designed to run 24/7 and like their larger brethren, cannot power up and down quickly. Before they even exist, they are obsolete. Their polluting “baseload” means of providing their product (electricity) will be unneeded and functionally and economically irrelevant–unable to compete with those offering electricity as part of a set of services, rather than as an end in itself.
August 20, 2015
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