Realism on Alternative Energy – Wind Power

Today Reuters posted a story called “Pickens backs off wind farm project

Texas oil billionaire T. Boone Pickens has called off plans to build the world’s biggest wind farm in the Texas Panhandle, the Wall Street Journal said.
 
Pickens said the wind farm project was scuttled partly because of the lack of adequate transmission lines to carry the electricity from remote locations to cities, according to the paper.
 
The oil tycoon had hoped to build new transmission lines but could not secure financing, the paper said.

This paper neatly summarizes the impossible economics for most of these large scale alternative energy projects, focusing on areas that aren’t usually covered well by the media or academics.

One of the favorite alternative energy projects involve wind energy, basically giant windmills / turbines that generate electricity when the wind blows. Wind energy viability is determined by a lot of factors, including:

1. how much the wind blows, or more accurately, how “steadily” the wind blows at a relatively high rate of speed
2. cost of the turbines / windmills
3. reliability of the turbines / windmills (one of the major manufacturers out of India has been recalling and having issues with the blades)
4. ability to find permits to site the blades (famously the Kennedy’s are blocking them for damaging the “view” off their compound on the East coast)
5. amount of subsidy that the state power commission / Federal government is providing for the energy (else they generally aren’t financially viable)
6. access to transmission lines to bring the electricity back to the urban areas that are most likely to utilize this electricity
7. access to funding (debt and equity) that allows the developer to build and secure the land, materials and equipment to complete the job

Of all these items, people tend to focus on items 1-4 above, with some understanding that without 5 (subsidies or requirements to “source” a certain percentage of generation alternatively), it isn’t going to just happen.

However, #6 and #7 are actually the biggest bottlenecks right now, and tied to long term items that the state, local and Federal authorities are doing the least about.

Item 6 – I would view our transmission grid the same way that you’d view the layout of factories during communism; based on a blueprint of assumptions from a methodology long since passed by. Back in the days when you could actually BUILD a transmission line, before you had to snake it around every coyote, plant, and sign of human habitation, the lines were built to connect the power sources at the time (hydro, coal, nuclear) with the population centers and large industrial areas at the time. Basically, we are talking about the 60’s and the early 70’s. This grid is what it is – in some places it makes a lot of sense, in some places (like near high growth areas in Nevada and California) it makes little sense – but you need to understand that it simply can’t be “fixed” by a policy paper or by throwing a few billion dollars at it here and there – it would take a major project, on the order of construction of the original interstate highway system, to fundamentally “fix” the grid to map it today where the people, industry and power sources of the FUTURE will lie, and require massive amounts of political will to fight NIMBY’s every step of the way to make it happen. Basically, this means we have what we have and, with only minor changes and upgrades along existing “rights of way”, it isn’t changing.

Item 7- access to funding for transmission is VERY difficult, for a host of complex reasons. Basically the underlying financial support network for many types of projects was taken away by “deregulation” (I use the words in quotes because it wasn’t deregulated, just regulated differently), where utilities in MOST areas could recover these types of infrastructure costs in the “base” rates charged to customers. Today generation has been mostly deregulated (meaning no one is building anything except for “toy” alternative projects and gas-fired peak plants) and the local distribution company (which is saddled with buying power and makes little money in the best of times) has to front the bill for transmission. Building transmission is a lonely business – it costs billions, and all it does is lower the price of power to the end customer and can reap a “toll” along the way between the generation site and the power user. Back in the old days, utilities would invest in transmission because it is critical to reliability and allowed them to expand their revenue base, but today these super high risk investments, which face fanatical opposition from local residents, are generally beyond the pale.

Pickens basically gave up because #6 and #7 were not viable.

Reality is going to hit all of the alternative energy concepts, sooner or later.

Cross posted at LITGM

11 thoughts on “Realism on Alternative Energy – Wind Power”

  1. What’s interesting and depressing is the lack of interest in “district heating & cooling”–the use of waste heat from power plants for heating and air conditioning of buildings in the vicinity. This is an old, proven technology which has demonstrted its ability to improve system-wide efficiencies. And the truth is, a small improvement in the efficiency of coal- and gas-fired plants would exceed the total output of the entire U.S. wind & solar fleet.

  2. Our transmission system was designed and built as part of a centrally planned electrical system under control of the local integrated utility. Some exceptions and overlays exist such as the federal power marketing agencies (WAPA here in the west.) They were planned as a SYSTEM.

    With deregulation, they are expected to be common carriers connecting multiple independent generators operating in a market. That’s a lot different job and the current design is ill-suited for it.

    Worst, there is not profit for a new transmission line. Opportunities for bottleneck relief exist but the transmission builder would need to capture most or all of the economic advantage. Either the transmission owner is not allowed to capture that economic rent or few such opportunities exist.

    Here in California, we had one place where GE Capital financed an upgrade to Path 15 between Central California and Los Banos at the southern margin of the San Francisco Bay Area. They got good terms but only because government had been extremely embarrassed by the power outages of 2001.

    As to central heating, it exists in the US but it only makes sense with very high load density. Plus, no one wants a large power generator downtown in the midst of an urban area. I was just in Sweden where they are more common but the load factors are much higher too.

    One should remind oneself that there usually is a good reason that other reasonable men before one may have thought something through too. Most existing arrangements have their reasons.

  3. Whitehall…there *are* places in the U.S. where power plants are located near high population densities. For example, there’s a coal-fired plant on the Potomac River located about a half mile from some large apartment complexes and only about a mile from Alexandria VA.

    Carsten & Schewe, in the article I link here, suggest that a major reason for the lack of district heating development in the US is regulatory.

  4. I’ve been wondering, with all the talk about electric cars and the like, where is the research on improving electric energy transmission–reducing the transmission loss? Realistically, any new capacity–esp. wind and solar, but even nuclear or “conventional” coal/oil/NG, is going to be located far from the demand, and the idea of reducing transmission distances with new, more direct corridors is as unlikely as this post says—as is massive increase in voltage in those existing corridors without a lot of stepping up and down every time the line goes near a farmhouse or a wetland where the occasional ducks may complain–so, how do we get a larger % of usable power through the system for each mile traveled, at more-or-less curent voltages?

    Seems like this would be huge, and maybe GE, ABB and Siemens are working on it, but this seems like an area where some sort of govt support might actually be worth considering.

    Just a thought.

  5. Mr. Foster,

    I acknowledged that there existing central heating and cooling systems in the US in my original comment. San Francisco has or had one a few years ago. The down has the highest density of people in the state. The US had more but they have often gone out of business over the years.

    Note that your eagerness for central heating runs counter to Marty’s hope for more efficient transmission of energy. Electricity and pipeline natural gas are the most efficient energy transmission media. The hot water, steam, and chilled water systems of central systems are short range systems due to high heat loses over distances.

    Electrical transmission is relatively efficient. The losses are from resistance, inductance, and static. The fixes are then 1) more expense for metal and hence for supports, 2) more space between conductors making them MORE invasive and 3) none. The system is pretty well balanced economically right now.

    The next step up is high voltage direct current at 1,000,00+ volts. But they still lose from static and from AC/DC and DC/AC conversion at either end so they tend to be long distance lines or between isolated AC grids. You can tell a DC high voltage transmission circuit by it having only two wires. One drives under one on I-5 in Sylmar on the north end of Los Angeles.

  6. I’ve been wondering, with all the talk about electric cars and the like, where is the research on improving electric energy transmission–reducing the transmission loss?

    Marty, thats why all the “new” transmission lines are in upper 100KV’s on voltage (with some new ones over one million KV), the higher the transmission voltage, the lower the line losses.

    I think the ammont of power lost from T&D is a bit overstated. I memory serves me, I think its around 7%.

  7. Some interesting comments here.

    The key is that the MSM was totally deluded in thinking that anything was going to happen with nuclear, transmission upgrades, or significant capacities in alternative energy.

    It was all pie in the sky crap before the economy melted down, but now it is totally impossible.

    I await a sea of retractions, in vain.

  8. “And the truth is, a small improvement in the efficiency of coal- and gas-fired plants would exceed the total output of the entire U.S. wind & solar fleet.”

    And cost a whole lot less money too. But where is the glamor in doing that?

  9. One big hit on generation efficiency came in 1972 when the EPA declared that new generating plants (not yet permitted) would be prohibited from using natural bodies of water for cooling. That requirement meant that separate cooling towers or cooling ponds had to be built. These usually have to run at higher temperatures than oceans or big rivers (120 degrees perhaps compared to 55 degrees here in California.)

    That results in a 1 to 3% decrease in overall plant efficiency and higher capital costs. More fuel is required to produce the same amount of electricity.

    Repeal or relax this ruling and new plants could be cheaper and more efficient.

Comments are closed.