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Is Wind Power Cheaper Than Coal Fired Power? – Well, No

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WIND POWER

A wind plant costs X amount of dollars. In virtually every case, because it is considered to be renewable, Governments of all persuasions will want entrepreneurs to sink their money into these plants, so to make them an attractive option, they will usually stump up anything to half the cost for the construction, and nearly every Country has large funds for just this purpose. So, having done this, you can now see that the amount needed to be recovered is now only half of what it really should be, bringing down the unit cost of electricity over the life of the plant.

The next big fiddle comes in that calculation I used above, and while the Nameplate Capacity, the day and the year are set in stone, they use the CF and the lifespan as their biggest method to alter the final result.

CAPACITY FACTOR

For the actual calculation I used the average CF of plants currently in operation, 25% and even that is on the high side.

When any Wind proposal is planned, the CF always used is 38%. Some have even tried to say that the wind in the area of the proposal is enough to support CF up to 42%, but all of them use that 38% figure. The use of this higher figure gives a dramatically increased total power delivered, and because of that you have more power to sell to cover the original costings, and just using the example of the theoretical 1000MW plant I used above, the end result is raised to 50TWH, an increase of 35TWH or if used as costing are usually shown as, that is an increase of 35 Million MWH, so now you can see how that would bring down the cost per unit of electricity provided for consumption.

LIFESPAN

While the lifespan always used is 25 years, recent actual information shows that the lifespan could be considerably shorter, and there is now written data that the lifespan could in fact be as low as 15 years. With respect to lifespan, the CF now also comes into play, as there is now data that CF drops after 10 years and that fall in the CF could be down as low as 15 to 20%, and then even lower after 15 years.

However, for the sake of these costings calculations, the CF of 38% is always used, and the lifespan of 25 years is always used.

COAL FIRED POWER

Long before we even get to the fiddle they use with coal fired power calculation I have used above, there are a number of things they have done to artificially raise the cost for coal fired power, so let’s look at them one by one.

COAL

  • A typical large scale Coal Fired plant might burn anything up to 6.5 million tons of coal each year, and that’s been pretty much a standard average for all large-scale plants. However, what is not taken into account is that this is for plants constructed in the ’70s because not many new plants have been constructed. New technology shows conclusively that less coal is burned per year. Even newer USC coal fired plants now in operation for years in China consume even less, up to 18% less coal in fact. However, that total of 6.5 million tons is always used for the costing purpose, so as you can see, inflating the amount of coal used will increase the cost, and in fact do so quite dramatically.
  • For costings purposes it is assumed that every plant has to purchase coal, and while this may be so for some plants, quite a number of others are in fact constructed on the site of the coal mine itself, and the Company that owns the plant, also owns the coal, so it has no need to buy coal, so again the cost is inflated and used for all coal fired plants. The, the costings are based on the highest cost for that coal used as the fuel, and for a number of years now, coal has been selling for prices at, or even lower than half the maximum used for the purposes of costings.
  • Then there is the transport of coal to the plant, and again, in every case the highest cost is used, and considering that some plants own their own coal, there is a seeming double whammy for them, as they are assumed to buy the coal, and then transport it as well, again considerably raising the cost of this ‘theoretical’ paper costing structure.

CARBON CAPTURE AND STORAGE (CCS)

  • This process is also used to inflate the cost. It is a process that will never be achieved on the scale required, and I cannot stress that word NEVER, enough. This process has two things that dramatically increase the cost.

    The first is that it adds anything up to 60% extra to the original construction price, as the process is enormously complex. This then means that more money has to be recovered, again raising the unit cost for the electricity sold to the grids.

  • By far the biggest impost however, is the second reason that it raises costs. That CCS process consumes up to 45% of the plant’s own generated power, just to run the process itself. Again, now you can see that this is a huge impost as now the plant has 45% less electricity to sell to the grids, and with raised cost already, they are now in a position where they have considerably less power to recover that cost from.
  • However, despite the fact that CCS will never be realised, it is still used as a driver for those costings purposes.

CARBON DIOXIDE TAX AND ETS

  • Using the original amount of 6.5 million tons of coal used, and that emits CO2, the imposition of any CO2 Tax again further raises the cost of the Plant, and this, while seemingly a small amount, when you realise that the amount of coal burned leads to an emission of almost 19 million tons of CO2 per year, then any CO2 price will dramatically increase costs here as well. In the case of Australia which currently has a cost of $25 per ton on CO2, then that CO2 Tax price alone sees a further cost addition of $475 Million each year. All this is based upon a cost of the larger amount for the CO2 Tax, and we’ve all see how the price for Carbon Credits has crashed in Europe and other places around the World.
  • The purpose of an ETS is to lower the cap on CO2 emissions each year, which means that less coal must be burned, hence less CO2 being emitted, and also less power being generated, so along with raising the price, they also then lower the power generated, again inflating the unit cost of the electricity being sold.

    However, in both cases, the maximum CO2 tax is added as a constant amount for the purposes of raising the cost for coal fired power, even though both change each year.

CF AND LIFESPAN
Here we see a further fiddle in the costings process.

  • With respect to the CF, the figure most commonly used is the average for all coal-fired power. Smaller, and in most cases considerably older plants have a much lower CF than the large scale plants that run pretty much constantly, supplying huge amounts of power. Other plants are used as spinning reserve, in other words, turbine/generator complexes turning and burning coal, but not delivering power until it is required for those dedicated time periods each day when Peaking Power is required, and these spinning reserve plants also have much lower CF as well. So, the average for all coal fired plants could be as low as 65 to 70%, so that lower figure of 65% is used for these costings purposes, when in fact typical large scale plants run at a CF approaching 75 to 80%. Again this artificially lowers the total power generated.
  • And here comes the biggest killer of all, the lifespan of the plant. For the purposes of this costing, they like to tell us that they prefer to use what they refer to as a level playing field, so what they do is to give every plant a lifespan of 25 years. This is half the average projected life span of a coal fired plant. So now you can see conclusively that they have halved the total power output of a coal fired plant at a stroke.

CONCLUSIONS

As is now quite plain, you can see how these costings are manipulated, and in fact with all of these things in place, wind actually seems to be able to compete or in fact to even be cheaper than coal fired power.

All of that is shot to shreds immediately a Wind plant starts operation though. The real power delivery is seen, and the data readily available. There is however one last thing that is used to lower the price of wind even further. There in the original contract before any construction takes place is shown that pliant believing Governments will even subsidise the unit cost for the electricity actually generated and delivered to all consumers, and that figure could be anything up to half the unit price as a subsidy to the Wind plant operator, further making it seem that Wind power is cheap. Then, there is legislation that forces providers to purchase the power generated by Wind plants, because providers would prefer to pay the lowest price for their power as that gives them the highest margin when they onsell that power to consumers. So, in effect, the mandated compulsory purchase of Wind power effectively raises the cost per unit for end consumers.

However, once the Wind plant is up and running, there’s no need to refer, ever again, to the data that might show the lies, because it is now a fait accompli, another Wind plant up and running. Besides, what is the headline here, not that it can’t deliver, in fact, but the analysis on paper that says it can compete.

Wind Power has been made to look cheap on paper, because of all the things I have detailed here, but it is all shown up when the plant starts operations delivering power. Really, they can say what they like because now, there is virtually nothing they can compare it to, because no one in their right mind would even consider opening up a new coal fired power plant, and even if they did consider it, it would be shot out of the water before the plans were even proposed, killed off by Governments too scared to approve something like this.

So, they can get away with making Wind ‘seem’ cheaper, even if it is only on paper.

Given an actual level playing field, Wind could NEVER compete, and in fact, it never will.

Click here for Page 1

Latest contributions From Tony

© Tony from Oz 2013
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Discussion

8 thoughts on “Is Wind Power Cheaper Than Coal Fired Power? – Well, No

  1. This was posted on another blog.

    You conveniently forgot to include costs for carbon capture/climate change/environmental degradation.

    To which I pointed out that this was covered on page 2. The article’s author has passed on some further thoughts, which I will post here.

    It seems that sometimes, people don’t even read the whole article.

    Carbon Capture is dealt with in the article. It is a process that will never be realised on the scale required, and yet, it is always used as a driver for those costs.

    Climate Change is also dealt with in the section under Carbon Dioxide and ETS, where I mention that these costs are used as add ons to the overall cost.

    As to environmental degradation, you have ONE large scale coal fired plant that covers a relatively small localised area to be cleaned up after possibly 50 years. For an equivalent Wind Plant delivering the same electrical power, you would have in the region of 500+ towers, delivering only one third of the power on a yearly basis, so realistically to deliver the same power, you are effectively looking at three maybe four Wind Plants, spread over a vast area, and to clean that up would cost considerably more than cleaning up the one coal-fired plant, and then, as the life span is only half that of the coal-fired plant, you have to do this every 25 years as opposed to the 50 years for the one coal-fired plant.

    Environmental degradation. Does that take in the known and documented data that wind plants kill many different species of birds and bats.

    Environmental degradation. Does that take in the now documented and proven data of the human medical problems associated with low intensity noise from wind towers.

    Environmental degradation. Does that take into account people driven from their land by those medical problems.

    Environmental degradation. Does that take in loss of visual acuity of the landscape with hundreds of towers detracting from looking at the actual environment.

    Grumpy, I hope this is of assistance.

    Tony.

    Posted by grumpydenier | April 24, 2013, 12:59 pm
  2. Another good reason to stop the insidious march of these useless follies?

    Wind turbines ‘could allow enemy jets to sneak into British airspace’

    The Ministry of Defence is fighting plans for two giant wind turbines over fears the towers could mark enemy jets entering British airspace.

    Posted by grumpydenier | April 25, 2013, 1:58 pm
  3. Excellent article Tony from Oz. Keep em’ coming.

    Posted by orcadiana | May 4, 2013, 7:52 pm
  4. Let’s consider what a wind-powered hospital in New York might look like. NYU’s Langone Medical Center lost power shortly after Sandy hit. The hospital had diesel-fired emergency generators, but basement flooding caused them to fail. That required the evacuation of hundreds of patients.
    Assume the hospital needs one megawatt of emergency electricity-generation capacity. Lives are at stake. It needs power immediately. That capability could easily be provided by a single, trailer-mounted diesel generator, which would occupy a small corner of the hospital’s garage (and be safely removed from any flooding threat). By contrast, providing that much wind-generation capacity would require about 5.6 million square feet of land—an area of nearly 100 football fields. And all of that assumes that the land is available, the wind is blowing, and there are enough transmission lines to carry those wind-generated electrons from the countryside into Lower Manhattan.http://hockeyschtick.blogspot.com.au/2012/11/after-sandy-no-one-lined-up-for-wind.html

    Posted by joe from Australia | May 30, 2013, 9:35 am
  5. The best place to look for any energy information, including the cost of wind vs. coal can be found in data collected by the EIA – Energy Information Administration. That is a cool place for number guys like me.

    Based on data I found in the EIA’s Annual Energy Review for 2012 I wrote an article that included a chart from that report comparing the 2016 projected, levelized costs for energy from a bunch of different sources. According to it “conventional coal” will cost $94.8/kWh and wind will cost $97/kWh. However, “Advanced coal with CCS” will cost $136.2/kWh.n

    Of course, by then, natural gas will be cheapest and solar the most expensive. Off-shore wind is also prohibitively expensive.

    My article is here:
    http://informthepundits.wordpress.com/2012/10/21/the-brawl-over-oil-and-natural-gas/

    Most of the source data for that article comes from here:
    http://www.eia.gov/forecasts/aeo/chapter_executive_summary.cfm
    and
    http://www.instituteforenergyresearch.org/2012/01/24/president-obamas-record-on-oil-and-gas-production/

    Posted by azleader | June 7, 2013, 9:58 pm
  6. I’m pleased that I seen this website, precisely the proper information that I was trying to find! cgaeeegdbgcg

    Posted by Johnd632 | July 24, 2014, 9:16 am

Trackbacks/Pingbacks

  1. Pingback: A new series of Guest posts by Tony from Oz | grumpydenier - April 22, 2013

  2. Pingback: Dispatches – 23 August 2013 (Dichotomy – 2 of a series) | grumpydenier - August 23, 2013

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