The article looks at the cost of renewables with fossil backup versus nuclear. It does not address the future costs related to emission targets, storage requirements and an alternative backup power when fossil is phased out.
The validity of the conclusion depends on cheap natural gas always being available and usable.
Renewables can never reach zero emission without a means of cheap storage, Systems with a high content of wind power require massive quantities of storage to overcome periods of "wind drought", whereas nuclear based grids can operate with minimal energy storage in the form of pumped hydro, thermal, hydrogen or a combination of all three with batteries for short term balancing.
When you consider all of the system requirements, including storage and regeneration, for a zero emission nuclear grid versus a renewables based grid, the nuclear proves to be about one third of the cost, and provides a more reliable system.
Nuclear should not be regarded as a baseload for use with renewables. In such a system the nuclear would have to be sized to provide 100% of peak load since there are always times when neither wind nor solar are producing. In such a system, the wind and solar serve no useful purpose. For the least expensive and most reliable zero emission system, it is the wind and solar that need to be eliminated, not the nuclear
Simplistic thinking about solar and wind misses their competitive advantages of synergy. Taken as one integrated source, solar primary by day and wind primary by night, they overlap and overlay to both load follow and peak match. Taken as a system of solutions with Demand Response Control (DRC) and also Distributed Energy Resources (DER) they become the preferred choice. Across large regions with diverse locations and generation types (perhaps also including HVDC transmission), they form transactive super-grids.
Note that offshore wind will dominate new US (and global) generation for a couple decades to come, and placed in choice wind corridors near major coastal population centers will have power profiles very close to that of the cities they border. Such location also increases wind dispatch to levels matching natural gas CCT.
Battery, as part of DRC and DER also matters. In each of the last three years the US grid added 11% of all new capacity as grid scale battery. That totals about 10 GW, or about 10 average nuclear reactors at peak demand output. That trend will continue globally. Now imagine 100 million US EV with 100 kWh battery each (~10 TW) compared to the US total generation capacity (~1.4 TW). Acting as smart grid devices and sitting still 90% of the time, they will levelize demand quite nicely and shift loads to periods of available solar and wind power. Amalgamated home/EV battery is already being organized into community microgrids and virtual power plants, all of which can feed back into the grid at peak demand or extreme weather events…. And all without constraint payments.
There simply is no good business case for competitive nuclear. Hence no investors. Hence no future.
I am personally not hung up on net zero. I believe we can "largely" decarbonize with renewables and flexible capacity (a lot of which will be gas) - that flexible capacity will be expensive in MWh terms but not in MW and little gas will actually be used (so lots of turbines but not so much gas) - and that's before e learn to do better with demand management and indeed storage.
Nuclear is no longer at one third of the cost of renewables - that used to be true but now it's the opposite. France proved that you can build a system around dominant nuclear (with lots of hydro and flexible capacity in neighbors) but we can do better now - and more importantly, cheaper, with renewables.
Good article - however it is rather long so would benefit from a good abstract summarizing the findings. This would enable more people to read it and so better understand the issues. Keep up the good work.
Except all wind turbine components as well as solar components are made in China. The gas & coal comes from Russia. What is the cost of dependence to foreign authoritarian regimes ?
It's not correct to say that wind turbine components come from China - that is still mostly domestic. Steel can come from Asia but that's less of a hard dependency. For solar, like for many other bits of our wider supply chains, at some point there will be a need to decide how to deal with China's anti-competitive and monopolistic tendencies, and some hard decisions on trade (and cost of stuff foe us in Europe and the US) will need to be made.
Question: Can't the same be said about natural gas? It's considered baseload and at this point is prohibitively expensive. Makes me think that lower natural gas generation will enable more renewable capacity to come online more often. No?
No, the economics of gas are very different - with high marginal costs, gas plants can be competitive in all circumstances (and gas prices drive power prices, so gas plants can "surf" on the price curve. The increase in renewable penetration (and zero-marginal-cost production) means that the link between gas prices and power prices gets cut some of the time (with power prices then lower than they would be only with gas plants), meaning that baseload is no longer an attractive model for gas plants. However, gas plants can still thrive as mid-to-peak load producers (to cater for the daily peaks in demand), or pure peakers (to cater for periods of unusually high demand, or unexpected events in the network).
So you could see a network with lots of gas plants (MW) but few Mis produced (but they will be sold very expensively, enough so that the plants are profitable even with low volumes of generation
First, on the sentence "It typically varies from 1 to 1.5 between night and day, 1 to 2 within a week, and 1 to 3% over the year.", I assume the % is a typo
Second, when comparing WACCs, have you been careful as to compare the same WACCs? I'm guessing 1% is real, pre-tax; which I doubt the 7% number is.
According to this carbon countdown clock (https://www.mcc-berlin.net/fileadmin/data/clock/carbon_clock.htm), at the current rate, the most CO2 we can emit to stay below 1.5ºC rise is 400 Gt, starting from 2020, and that carbon budget will be used up by about July/August 2029.
We are at 302 Gts left as I write.
Within that time frame, new nuclear will do little or nothing. It takes too long to build as well as being more expensive than the alternatives and not meshing well with renewables.
We're at 1.2ºC over 1880s global temperature now, I believe, and latest headlines say 50/50 chance of going over 1.5ºC temporarily by 2026. So it might be good to use these climate deadlines as a frame of reference.
I tweeted at Mark Z Jacobson whose group at Stanford has been doing plans to bring the world to zero emissions energy by 2035 or 2030, in some cases, that it might be good to use the carbon budget deadline of July/August 2029 instead so that we can do some backcasting from that date to figure out what we should be doing today and tomorrow and the days after that in order to meet that schedule.
Excellent article, as always, which would deserve to be circulated broadly to our French politicians. Note that 92.5 GBP/MWh paid for Inkley Point nuclear is in 2012 price, so more than 120 GBP/MWh in today's price, close to 150 EUR/MWh...
Really enjoyed finding your new blog Jerome - I still remember reading your Cost of Wind, Value of Wind article on the Oil Drum all those years ago. I have been doing some of my own analyses and simualations which you might find interesting, sounds like you're doing a similar sort of thing. I can't claim to have anything like your industry knowledge but I can do graphs and simulations... :) https://www.linkedin.com/pulse/simulating-uk-grids-transition-net-zero-part-1-phil-chapman/
The article looks at the cost of renewables with fossil backup versus nuclear. It does not address the future costs related to emission targets, storage requirements and an alternative backup power when fossil is phased out.
The validity of the conclusion depends on cheap natural gas always being available and usable.
Renewables can never reach zero emission without a means of cheap storage, Systems with a high content of wind power require massive quantities of storage to overcome periods of "wind drought", whereas nuclear based grids can operate with minimal energy storage in the form of pumped hydro, thermal, hydrogen or a combination of all three with batteries for short term balancing.
When you consider all of the system requirements, including storage and regeneration, for a zero emission nuclear grid versus a renewables based grid, the nuclear proves to be about one third of the cost, and provides a more reliable system.
Nuclear should not be regarded as a baseload for use with renewables. In such a system the nuclear would have to be sized to provide 100% of peak load since there are always times when neither wind nor solar are producing. In such a system, the wind and solar serve no useful purpose. For the least expensive and most reliable zero emission system, it is the wind and solar that need to be eliminated, not the nuclear
https://johnd12343.substack.com/p/the-road-to-zero-emissions-must-embrace
Simplistic thinking about solar and wind misses their competitive advantages of synergy. Taken as one integrated source, solar primary by day and wind primary by night, they overlap and overlay to both load follow and peak match. Taken as a system of solutions with Demand Response Control (DRC) and also Distributed Energy Resources (DER) they become the preferred choice. Across large regions with diverse locations and generation types (perhaps also including HVDC transmission), they form transactive super-grids.
Note that offshore wind will dominate new US (and global) generation for a couple decades to come, and placed in choice wind corridors near major coastal population centers will have power profiles very close to that of the cities they border. Such location also increases wind dispatch to levels matching natural gas CCT.
Battery, as part of DRC and DER also matters. In each of the last three years the US grid added 11% of all new capacity as grid scale battery. That totals about 10 GW, or about 10 average nuclear reactors at peak demand output. That trend will continue globally. Now imagine 100 million US EV with 100 kWh battery each (~10 TW) compared to the US total generation capacity (~1.4 TW). Acting as smart grid devices and sitting still 90% of the time, they will levelize demand quite nicely and shift loads to periods of available solar and wind power. Amalgamated home/EV battery is already being organized into community microgrids and virtual power plants, all of which can feed back into the grid at peak demand or extreme weather events…. And all without constraint payments.
There simply is no good business case for competitive nuclear. Hence no investors. Hence no future.
Thanks for the comment.
I am personally not hung up on net zero. I believe we can "largely" decarbonize with renewables and flexible capacity (a lot of which will be gas) - that flexible capacity will be expensive in MWh terms but not in MW and little gas will actually be used (so lots of turbines but not so much gas) - and that's before e learn to do better with demand management and indeed storage.
Nuclear is no longer at one third of the cost of renewables - that used to be true but now it's the opposite. France proved that you can build a system around dominant nuclear (with lots of hydro and flexible capacity in neighbors) but we can do better now - and more importantly, cheaper, with renewables.
Good article - however it is rather long so would benefit from a good abstract summarizing the findings. This would enable more people to read it and so better understand the issues. Keep up the good work.
Except all wind turbine components as well as solar components are made in China. The gas & coal comes from Russia. What is the cost of dependence to foreign authoritarian regimes ?
It's not correct to say that wind turbine components come from China - that is still mostly domestic. Steel can come from Asia but that's less of a hard dependency. For solar, like for many other bits of our wider supply chains, at some point there will be a need to decide how to deal with China's anti-competitive and monopolistic tendencies, and some hard decisions on trade (and cost of stuff foe us in Europe and the US) will need to be made.
Question: Can't the same be said about natural gas? It's considered baseload and at this point is prohibitively expensive. Makes me think that lower natural gas generation will enable more renewable capacity to come online more often. No?
No, the economics of gas are very different - with high marginal costs, gas plants can be competitive in all circumstances (and gas prices drive power prices, so gas plants can "surf" on the price curve. The increase in renewable penetration (and zero-marginal-cost production) means that the link between gas prices and power prices gets cut some of the time (with power prices then lower than they would be only with gas plants), meaning that baseload is no longer an attractive model for gas plants. However, gas plants can still thrive as mid-to-peak load producers (to cater for the daily peaks in demand), or pure peakers (to cater for periods of unusually high demand, or unexpected events in the network).
So you could see a network with lots of gas plants (MW) but few Mis produced (but they will be sold very expensively, enough so that the plants are profitable even with low volumes of generation
typo: "few Mis" should be "few MWh" obviously
Nice article!
I had two remarks:
First, on the sentence "It typically varies from 1 to 1.5 between night and day, 1 to 2 within a week, and 1 to 3% over the year.", I assume the % is a typo
Second, when comparing WACCs, have you been careful as to compare the same WACCs? I'm guessing 1% is real, pre-tax; which I doubt the 7% number is.
Thanks for catching the typo, now corrected.
Re WACC - 7% should be pre-tax - the tax structure of investors i not necessarily linked to that of the jurisdiction of the project.
According to this carbon countdown clock (https://www.mcc-berlin.net/fileadmin/data/clock/carbon_clock.htm), at the current rate, the most CO2 we can emit to stay below 1.5ºC rise is 400 Gt, starting from 2020, and that carbon budget will be used up by about July/August 2029.
We are at 302 Gts left as I write.
Within that time frame, new nuclear will do little or nothing. It takes too long to build as well as being more expensive than the alternatives and not meshing well with renewables.
I'm not sure that those carbon budgets should be taken seriously. They are made-up numbers.
We're at 1.2ºC over 1880s global temperature now, I believe, and latest headlines say 50/50 chance of going over 1.5ºC temporarily by 2026. So it might be good to use these climate deadlines as a frame of reference.
I tweeted at Mark Z Jacobson whose group at Stanford has been doing plans to bring the world to zero emissions energy by 2035 or 2030, in some cases, that it might be good to use the carbon budget deadline of July/August 2029 instead so that we can do some backcasting from that date to figure out what we should be doing today and tomorrow and the days after that in order to meet that schedule.
No response so far.
Excellent article, as always, which would deserve to be circulated broadly to our French politicians. Note that 92.5 GBP/MWh paid for Inkley Point nuclear is in 2012 price, so more than 120 GBP/MWh in today's price, close to 150 EUR/MWh...
Much appreciate your articles, perspective and insight. Always an interesting read!
Really enjoyed finding your new blog Jerome - I still remember reading your Cost of Wind, Value of Wind article on the Oil Drum all those years ago. I have been doing some of my own analyses and simualations which you might find interesting, sounds like you're doing a similar sort of thing. I can't claim to have anything like your industry knowledge but I can do graphs and simulations... :) https://www.linkedin.com/pulse/simulating-uk-grids-transition-net-zero-part-1-phil-chapman/
What you've done is exactly what I'd like to explore further - maybe we can discuss offline how to take this further?
Sure!! Please just DM me on LinkedIn or Twitter or email me.