The Wider System Costs Of Renewable Energy

By Paul Homewood

Willis Eschenbach wrote a piece over at WUWT last week, about the widespread use of Levelized Costs of Energy, and their failure to deal with the wider system costs of different sources of generation.

He mentioned this OECD study, which attempted to measure those wider system costs:

https://read.oecd-ilibrary.org/nuclear-energy/nuclear-energy-and-renewables_9789264188617-en#page1

The study was based on data from six countries, so I though I would focus on the UK.

First I should point out that the study was published in 2010, so current costs will be higher, maybe by about 50%. But I believe that the costs are every bit as real now as they were back then.

The report explains:

Here is the table for the UK:

So at a penetration of 30%, wider system costs would add $45.39/MWh to the cost of generation itself. Something around £50/MWh at today’s prices.

The National Grid’s Future Energy Scenarios suggest that wind and solar power will supply four fifths of electricity by 2035, about 450 TWh, most of which will be offshore wind.

Leaving aside the question of whether such a high penetration is even practicable, at a cost of £50/MWh the wider system costs will amount to £22 billion, over £800 per household.