AE-NMidlands wrote: ↑Sun Sep 25, 2022 9:09 am
GarethC wrote: ↑Sun Sep 25, 2022 7:48 am
When building new renewable electricity plants is cheaper than running -existing- fossil fuel power stations,
I have seen this statement before and it is a shame it is not being rephrased. I think I know what it means. An economist friend (right-wing, sceptic) says it is illiterate and meaningless, comparing apples and pears.
I think it means that "You can build and run a renewable generator (including paying off all the build costs - and the depreciation?) for less than it costs to just run a ff plant." However, nationally we have to recognise that there is an additional cost, of maintaining a back-up supply. I don't think it would be a problem because storage ought to be able to pay for itself, buying at times of surplus and releasing during peak hours. There are still construction and depreciation costs though, so you need a pretty good margin.
A
I like the statement. My understanding is that new RE generation is cheaper than existing FF generation, even if the old powerstation has fully amortized its build costs (CAPEX). Effectively, RE generation with CAPEX and OPEX costs, is still cheaper than the OPEX costs of a FF power station.
My understanding is, though I may be wrong, that the comparison is before including all of the externality costs of the FF generation too.
Separate comment - But back in 2012, on the MSE forum, I started going head to head with those arguing against PV subsidies, and calling them immoral, (who were of course also nuclear supporters). Apparently a subsidy paid by all, that only goes to those that take part is immoral? I thought that was pretty much the definition of a subsidy, but I digress. [Just to be clear, this was early 2012 before the HPC announcement, so they claimed that nuclear would never need any more subsidies.]
So my argument at the time, was that wealthy countries such as the UK (and led by Germany and Italy with their earlier FiT schemes) could afford to kickstart the PV revolution, create artificial increased demand, which in turn creates additional supply, leading to the learning curve / Wrights law, where technology costs reduce by X% for every doubling in supply. Thus our subsidy investments, meant that poorer countries that couldn't afford subsidies, would soon be able to afford the technology itself.
I specifically mentioned India repeatedly as it had announced a huge increase in coal power stations, but later reversed course, reduced the amount of coal generation (not zero, but less), whilst massively rolling out PV and wind. We ('we' being subsidy countries) effectively headed them off at the pass, to use some playful language, and helped create an alternative route for them to economically take.
The biggest win for investment in RE in the west, may well be the avoided emissions in the developing world, thanks to RE cost reductions.
And RE costs have fallen further and faster than even my overly positive brain thought was possible.
