Hidden Costs: how wind generation makes gas power $30/MWh more expensive

Just another hidden cost — intermittent generators are vandals on our baseload suppliers. Wind power needs gas, but gas doesn’t need the wind. When the two are paired together it makes the wind energy “reliable” but adds nearly $30/MWh to the cost of the energy from gas. Right now that cost will be added to the gas plant, but in a free market, it should be paid by the wind farm investors.

Stacy and  Taylor compared the cost of running a Closed Cycle Gas plant (CC Gas) on its own or combined with a wind farm.  The combination produces reliable electricity “on demand” and uses less gas to do it. The sole benefits to this odd industrial couple are a smaller gas bill and lower emissions of a fertilizing gas (CO2). All the capital and labor costs of running a gas plant are the same, but now it sits idle more often, pointlessly waiting like a til the wind slows to come back on. About the only thing we can predict about the wind farm is that it can be relied on for almost nothing, so the gas plant must be almost as large whether or not it is chained to a wind generator.

Here’s a detailed estimate of some of the hidden costs of adding an intermittent power source to a reliable one. The figures are based on US data and came out a couple of years ago.

The idealized extra cost of adding wind to gas is $15/MWh, but the cost using real world capacity factors is $30/MWh.

Notice the “Nameplate capacity” on the right. Look at all the extra capital infrastructure required to generate the same amount of electricity. All that extra blood, sweat, tears and investment sitting around doing nothing most of the time.

Renewable energy saves fossil fuel, but wastes infrastructure, land, labor and resources.

Combined Wind and Gas plant, imposed costs, graph, EIA.

Click to enlarge.

Here’s how you can use 1.8 times as much infrastructure to achieve no extra electricity

In the lowest cost scenario a 1MW gas plant works at 87% capacity. If it is paired with an equal nameplate capacity wind farm, the gas plant needs to be almost as large because wind power can only be relied on to produce 2.7% of it’s full capacity all the time. Hence rather than building a 1MW gas plant, we need to build a 0.97MW gas plant , only a tiny bit smaller, and 0.87MW of wind. The wind+gas combo will work together in synchrony to create the same amount of electricity as the 1MW wind. But it’s obviously a horrible deal — it requires a lot more capital outlay and infrastructure to build, then a lot of the time either the gas plant or the wind plant is sitting idle.The new gas capacity factor falls from 87% down to 58%.

The imposed cost of generating a MW of  from gas rises by at least $15/MWh when the gas plant is chained to a wind plant. This is the best case capacity factor, but real world capacity factors are lower. Using the real world data the capacity factor for gas on its own starts at 47% and falls to 32% when combined with a wind plant. The capacity factor of wind is 33%. In the real world scenario the cost imposed on the gas plant is $30/MWh.

The cost of running a gas plant on it’s own (LCOE) is  $73 /MWh

The cost of running a new wind farm (plus the imposed cost on the gas plant) = $113 /MWh.

Renewables are not just a waste of space, they’re like anti-matter on the grid, damaging everything around them.

Thanks to commenter Lance.

REFERENCE

Stacy, T. Taylor, G. (2015) The Levelized Cost of Electricity from Existing Generation Sources, Institute for Energy Research (IER), based on EIA figures in the USA.

 

 

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April 10, 2018 at 12:04PM

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