A Wind Update

From our Mid-Atlantic energy analyst friend (i.e. who prefers to remain anonymous):

Blowout week, batteries and offshore wind

Don and Monica Kotowych at Grouse Mountain BC by Dave Harbour, IOGCC Meeting, 6-2-12

we link Euan Mearns’ Blowout Week collection of links to major energy articles from the past week, with a host of excerpts and links to many timely energy topics. The excerpt delivery approach follows our effort to pass along the basic part of a story quickly. This is perfect in our time-challenged society.

http://euanmearns.com/blowout-week-184/

The first two excerpts tonight deal with the same topic: Elon Musk’s “bet” that he can deliver the world’s largest battery storage system in 100 days, or it will be done free. There are no notes about actual cost, reliability, useful life, or any other pertinent data, for that matter. But Musk is a world-class promoter. He is getting a lot of focus on the issue of batteries, although his actual progress in delivering is subject to question.

But it is good copy.

Reneweconomy: Tesla to build world’s biggest storage battery in S. Australia

The South Australia government has announced that its 100MW battery storage tender – which it says is the world’s largest – has been won by Tesla and French renewable energy developer Neoen.

Colorado Wind Generators. Northern Gas Pipelines photo by Dave Harbour

The 100MW/129MWh battery bank will be built at Neoen’s huge Hornsdale wind complex near Jamestown, where the last stage of a 309MW project is currently being completed. Premier Jay Weatherill said the Hornsdale Power Reserve will become the state’s largest renewable generator, and while the lithium battery would be the biggest in the world. “South Australian customers will be the first to benefit from this technology which will demonstrate that large-scale battery storage is both possible and now, commercially viable.” The announcement was made jointly with Tesla founder and CEO Elon Musk, who flew into Adelaide for the announcement. Musk said the installation would be three times bigger than the next installation. “This is a chance to show you can really do a heavy duty, large-scale utility battery and battery system, and South Australia was up to the challenge. If South Australia is willing to take a big risk then so are we,” he said.

Engineering & Technology: Tesla will construct largest-ever grid scale battery within 100 days or lose $50m

Under the terms of the agreement, Tesla must deliver the 100-MW battery within 100 days of a contract being signed or it’s free, matching a commitment made by Tesla Chief Executive Officer Elon Musk in a Twitter post in March. “There will be a lot of people that will look at this, ‘Did they get it done within 100 days? Did it work?’” Musk told reporters in South Australia’s capital city of Adelaide. “We are going to make sure it does.” The 100-day deadline will begin within a few weeks, a political source said, after a connectivity agreement is reached between South Australia, Telsa, Neoen and the Australian Energy Market Operator. Musk and a spokesman for South Australia Premier Jay Weatherill declined to reveal the cost of the project. Musk said a failure to deliver the project in time would cost his company “$50 million or more”, without elaborating further.

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This article from the WSJ tomorrow does a decent job of putting the offshore wind farm business in perspective:

  • It will be costly
  • The power is non-competitive (note: The article only notes that the initial rate on Block Island power is 24.4 cents/kwh. It does not mention that the rate is scheduled to increase every year for the foreseeable future. And it does not discuss how that rate is subsidized)
  • None of the equipment is manufactured in the U.S.
  • Natural gas prices are giving planning for offshore wind huge economic problems.
  • The permitting, especially in federal waters, is monumentally burdensome

In short, there are huge problems, so the industry is essentially nowhere. But it makes good reading every so often.

BTW, a number of the comments on the article are worth perusing.

https://www.wsj.com/articles/plans-for-u-s-wind-farms-run-into-headwinds-1499605200

Plans for U.S. Wind Farms Run Into Headwinds

More than a dozen offshore projects are in the works, but high costs and logistical challenges remai

By

Erin Ailworth

Updated July 9, 2017 3:45 p.m. ET

106 COMMENTS

After two decades spinning power from the gusts that sweep Europe’s North Sea, the offshore wind industry is finally turning to the U.S. A big hurdle: getting its giant turbines to American waters.

No one in the U.S. currently makes turbine towers sizable enough for use in deep waters—one of the many challenges impeding the buildup of offshore wind on the other side of the Atlantic Ocean.

The first offshore wind installation in the U.S., a $300 million, 30-megawatt project off Rhode Island, began turning six months ago. Companies including Denmark’s Dong Energy AS DENERG 1.10% , Norway’s Statoil AS STO -0.24% A and Spain’s IberdrolaSA IBDRY 0.03% are now pursuing more than a dozen projects that would dwarf it.

But the Block Island wind farm in the U.S. currently generates power for 24.4 cents per kilowatt-hour  (!!!!!!!!!) while offshore wind projects in Europe can come in well under 10 cents per kilowatt-hour. Developers are optimistic that, as occurred in Europe, prices will go down as more projects begin and a supplier network takes shape in the U.S.

“They are really viewing this as a real market if you are attracting players like Dong and Iberdrola and Statoil,” said Maxwell Cohen, a senior research analyst at IHS Markit . “I’ve heard some pretty major companies that are not in offshore at least being asked, ‘Why not?’”

If all 17 of the proposed farms are built, the wave of U.S. offshore wind projects, primarily concentrated in the Northeast, would add 9.1 gigawatts of generating capacity, according to the American Wind Energy Association. That is enough to power 3 million homes.  (Excerpt only: go to WSJ for full report)

Wind Commentary

by

Dave Harbour

See our June commentary re: Wind energy is not environmentally superior to fossil fuel for many reasons we have identified; ratepayers must subsidize it via biased state law and regulatory mandates; and, Congress and the Administration have forced taxpayers to subsidize it.

Ironically, we have shown that alternative energy/climate change activists are focused on the destruction of capitalism, not protection of the environment.

These agenda driven high price mandates on naive citizens have weakened the economy, perverted the free market and created a large new cult of crony capitalists.  Crony capitalists pretend to be free market business leaders in public but lobby in the shadows for more and continued subsidies.

This deep culture of faux-environmental cronyism contributes to less free market power and increasing, despotic socialist power as the ranks of subsidized constituencies grow.

We support alternative energy industries, but not subsidized by me the ratepayer or me the taxpayer.  -dh