Clean & Clean-burn: Renewable Energy & Natural Gas powered Electricity Grids

by John Brian Shannon

Clean and Clean-Burn: Energy, the way it should be

Planetary energy graphic courtesy of Perez and Perez.
Planetary energy graphic courtesy of Perez and Perez.

Of all the energy that is available to us, solar energy is by far the most available and the most evenly distributed energy resource on planet Earth.

Wind and Solar + natural gas = Synergy

  • Solar is available all day every day. But not at night.
  • Wind is available day and night, but it can produce variable power levels as the wind blows over the landscape.
  • Meanwhile, offshore wind turbines produce constant power, spinning at constant speeds for years at a time — except when an operator locks the blades during large storms or during the annual maintenance inspection.

Both solar power and wind power face varying levels of ‘intermittency‘ — which requires the use of ‘peaking power plants‘ or ‘load-following’ power plants — to meet total demand.

‘Catch my Fall’ — All electrical power generators are interdependent

How electricity grids use different power generators to meet total and constantly changing electricity demand.

In the case of renewable energy, the negatives include some variability in the total output of solar power or wind power generation due to temporary cloud cover or storms. At such times, natural gas-fired generation can ramp-up to cover any shortfall.

Note: This is a common and daily energy grid practice whether renewable energy is involved or not. Some gas-fired power plants are called peaking power plants which quickly ramp-up to meet output shortfalls. In fact, peaking power plants (which are almost always gas-fired) were created to meet temporary shortfalls — and were in widespread use long before renewable energy ever hit the market.

Also in the case of renewable energy, another negative is that the Sun disappears at night and solar panels stop contributing to the grid. And unless you have offshore wind turbines to make up the shortfall, onshore wind turbines may fall short of total demand. So at night, you need reliable power to make up shortfalls in primary generation.

Note: This is a common and daily energy grid practice whether renewable energy is involved or not. To cover this situation load-following power plants were designed to meet larger output shortfalls. In fact, load-following power plants were created to meet larger, daily, shortfalls — and were in widespread use long before renewable energy ever hit the market.

In the case of natural gas, the negative is that gas is subject to wild price swings, thereby making gas-fired generation very expensive. Which is why it evolved into peaking power plants, less often in the load-following role and almost never as a baseload power generator.

The other negative associated with natural gas is of course, the fact that gas turbines put out plenty of CO2. That we can deal with. Unlike coal, where the CO2 portion of the airborne emissions are almost the least of our worries — as coal emissions are loaded with toxic heavy metals, soot and other airborne toxins.

How can we deal with the CO2 emitted by gas-fired power plants?

As gas-fired peaking power plants typically fire up anywhere from a couple of dozen hours annually, to a few hours of every day (usually to cover the additional load of many air conditioners suddenly switching on during hot summer days, for example) we aren’t talking about a whole lot of CO2.

Gas-fired load-following power plants typically run for a few hours every day and to cover demand in case of primary generator (like hydro-electric or nuclear power plant) maintenance. In the case of load-following plants, much more CO2 is produced annually.

Carbon Capture and Sequestration (CCS) of gas-fired CO2 emissions via tree planting

  • Peaking power plants operate for a few hours per year. We’re not talking that much CO2.
  • Load-following power plants operate for many hours per year. More CO2.

But still, each mature tree absorbs (a low average of) 1 ton of CO2 from the atmosphere and keeps it in storage for many decades. Some trees, like the ancient Sequoia trees in California, are 3700 years old and store 26 tons of CO2 each! Certain trees native to Australia store even more carbon and live longer than Sequoia trees.

And, as anyone who has worked in the forest industry knows; Once that first planting hits maturity (in about 10 years) they will begin dropping their yearly seeds. Some trees like the cottonwood tree produce 1 million seeds annually for the life of the tree. American Elm trees set 5 million seeds per year. More trees. Always good.

It’s an easy calculation: “How many tons of CO2 did ‘ABC’ gas-fired power plant output last year?”
Therefore: “How many trees do we need to plant, in order to cover those emissions?”

Simply plant a corresponding number of trees and presto! gas-fired generation is carbon neutral

By calculating how many tons each gas-fired peaking power plant contributes and planting enough trees each year to cover their CO2 contribution, tree planting could allow gas-fired power plants to become as carbon neutral as solar power or wind power.

The total number of trees that we would need to plant in order to draw gas-fired peaking power plant CO2 emissions down to zero would be a relatively small number, per local power plant.

By calculating how many tons each gas-fired load-following power plant contributes and planting enough trees annually to cover their CO2 contribution they too could become just as carbon neutral as solar panels or wind turbines. Many more trees, but still doable and a simple solution!

The total number of trees that we would need to plant in order to draw gas-fired load-following power plant CO2 emissions down to zero would be a much larger number. But not an impossible number.

So now is the time to get kids involved as part of their scholastic environmental studies, planting trees one day per month for the entire school year.

Let the gas-fired power plant operators contribute the tree seedlings as part of their media message that the local gas-fired power plant is completely carbon neutral (ta-da!) due to the combined forces of the power plant operator, the natural carbon storage attributes of trees, and students.

Up to one million trees could be planted annually if every school (all grades) in North America contributed to the effort — thereby sequestering an amount of CO2 equal to, or greater than, all gas-fired generation on the continent.

It’s so simple when you want something to work. Hallelujah!

Baseload, peaking, and load-following power plants

Historically, natural gas was too expensive to used in baseload power plants due to the wildly fluctuating natural gas pricing and high distribution costs, but it is in wide use around the world in the peaking power plant role, and less often, in the load following power plant role.

Renewable energy power plants can be linked to ‘peaking’ or ‘load-following’ natural gas-fired power plants to assure uninterrupted power flows.

Peaking power plants operate only during times of peak demand.

In countries with widespread air conditioning, demand peaks around the middle of the afternoon, so a typical peaking power plant may start up a couple of hours before this point and shut down a couple of hours after.

However, the duration of operation for peaking plants varies from a good portion of every day to a couple dozen hours per year.

Peaking power plants include hydroelectric and gas turbine power plants. Many gas turbine power plants can be fueled with natural gas or diesel. — Wikipedia

Using natural gas for baseload power

Natural gas has some strong points in its favour. Often it is the case that we can tap into existing underground gas reservoirs by simply drilling a pipe into naturally occurring caverns in the Earth which have filled with natural gas over many millions of years. In such cases, all that is required is some minor processing to remove impurities and adding some moisture and CO2 to enable safe transport (whether by pipeline, railway, or truck) to gas-fired power plants which may be located hundreds of miles away.

It is the natural gas market pricing system that prevents gas from becoming anything other than a stopgap energy generator (read: peaking or load-following) and almost never a baseload energy generator.

Let’s look at local solutions to that problem.


Several corporations are working with local governments to find innovative ways to capture landfill methane gas to produce electricity from it.

Keep in mind that the methane gas that escapes from every single landfill in the world (whether still operating or having ceased operations long ago) is 23 times more damaging to the atmosphere than CO2.

Increasingly, landfills are now installing perforated pipes underground which draw the landfill gas (so-called ‘swamp methane’) to an on-site processing facility. It is a low-grade gas which is sometimes blended with conventional natural gas to create an effective transportation or power generation fuel. Visit the Caterpillar Gas Power Solutions website here.

Waste Management is a global leader in the implementation of this technology, using its own landfills and municipal landfills across North America to produce over 550 megawatts of electricity, which is enough to power more than 440,000 homes. This amount of energy is equivalent to offsetting over 2.2 million tons of coal per year. Many more similar operations are under construction as you read this. Read the Waste Management landfill bioreactor brochure (downloadable PDF) here.

Durban, South Africa, a city of 3.5 million people, has created a huge Waste-to-Fuel landfill power plant that provides electricity to more than 5000 nearby homes.

Durban Solid Waste receives 4000 tons of trash each weekday which produces some 2600 cubic metres of gas every day of the year.

The GE Clean Cycle Waste-to-Fuel power plant arrives in 4 large shipping containers, and once connected to the gas supply pipeline it is ready to power nearby buildings and to sell surplus power to the grid.

One GE Clean Cycle Waste-to-Fuel power plant unit can generate 1 million kWh per year from waste heat and avoid more than 350 metric tons of CO2 per year, equivalent to the emissions of almost 200 cars.

Blending Conventional Natural Gas with Landfill Gas

As conventional natural gas is expensive (and much of the cost is associated with transportation of the gas over long distances) when we blend it 50/50 with landfill gas, we drop the cost of the gas by half. Thereby making blended natural gas (from two very different sources) more competitive as a power generation fuel.

By blending conventional natural gas 50/50 with landfill gas; We could produce baseload power with it — but more likely than that, we could use it to produce reasonably-priced load-following or peaking power to augment existing and future renewable energy power plants — rather than allow all that raw methane from landfills to escape into the atmosphere.

Best of Both Worlds — Renewable Energy and Natural Gas

Partnering renewable energy with natural gas in this way allows each type of power generator to work to their best strength — while countering negatives associated with either renewable energy or natural gas.

Renewable power generation and lower cost natural gas can work together to make coal-fired electrical power generation obsolete and accelerate progress toward our clean air goals.

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As Nuclear steps aside, Renewable Energy steps up to power Europe

As Nuclear steps aside, Renewable Energy steps up to power Europe | 16/08/14
by John Brian Shannon John Brian Shannon

Nuclear reactors are starting to shut down in Europe

It began in earnest in the wake of the Fukushima disaster when Germany inspected its problem-plagued nuclear power plants and decided to take 9 of its nuclear power plants offline in 2011 and the rest offline by 2022.

There is plenty of public support in the country for Germany’s planned nuclear closures, even with the additional fee added to each German electricity bill to pay for nuclear power plant decommissioning, which completes in 2045.

Switzerland likewise has decided to get out of the nuclear power business beginning in 2015 and decommission their nuclear power plants by 2045.

Other European nations are also looking at retiring their nuclear power plants. But the news today is about the UK, Belgium, Germany and Spain.

Heysham_Nuclear_Power_Station UK operated by EDF
Heysham Nuclear Power Station in the UK which is operated by EDF of France. Image courtesy:

In the UK, four (French-operated) EDF reactors built in 1983 have been shut down after one of them was found to have a crack in its centre spine. (EDF stands for Electricity de France which is a French utility responsible for managing many nuclear reactors)

At first only the affected unit was taken offline (in June) but upon further inspection it was determined that the other three were at risk to fail in the coming months. Whether or not these four reactors can be repaired economically — all were scheduled to be decommissioned before 2020.

The shortfall in electrical generation due to these unscheduled nuclear power plant shutdowns has been met by 5 GW of new wind power generation, which has seamlessly stepped in to fill demand.

Additional to that, 5 GW of solar power has been added to the UK grid within the past 5 years. And that’s in cloudy olde England, mates!

In Belgium, 3 out of 5 of their nuclear power plants are offline until December 31, 2014 due to maintenance, sabotage, or terror attacks — depending who you talk to.

Belgium’s Doel 4 reactor experienced a deliberate malfunction last week and workers in the country’s n-plants are henceforth directed to move around inside the plants in pairs.

Also, their Tihange 2 reactor won’t be ready to resume power production until March, 2021. See this continuously-updated list of nuclear power plant shutdowns in Belgium.

Further, the utility has advised citizens that hour-long blackouts will commence in October due to a combination of unexpected n-plant shutdowns and higher demand at that time of year.

Belgian energy company Electrabel said its Doel 4 nuclear reactor would stay offline at least until the end of this year after major damage to its turbine, with the cause confirmed as sabotage.

Doel 4 is the youngest of four reactors at the Doel nuclear plant, 20 km north of Antwerp, Belgium’s second-biggest city.

The country has three more reactors in Tihange, 25 km southwest of the city of Liege.

Doel 1 and 2, which came on line in 1975, are set to close in 2015. Tihange 1, which also started operation in 1975 and was designed to last 30 years, got a 10-year extension till 2015.

The two closed reactors Doel 3 and Tihange 2 were connected to the grid in 1982 and 1983. Doel 4 and Tihange 3, which came on line in 1985, were operating normally until the closure of Doel 4 last week.

The shutdown of Doel 4’s nearly 1 gigawatt (GW) of electricity generating capacity as well as closures of two other reactors (Doel 3 and Tihange 2) for months because of cracks in steel reactor casings adds up to just over 3 GW of Belgian nuclear capacity that is offline, more than half of the total.

In Britain, EDF Energy, owned by France’s EDF, took three of its nuclear reactors offline for inspection on Monday after finding a defect in a reactor of a similar design. – Reuters

In Germany, the nuclear power generation capacity missing since 2011 has been met by a combination of solar, wind, bio, natural gas, and unfortunately some coal. But that sounds worse than it is.

According to the Fraunhofer Institute, renewable energy produced about 81 TWh, or 31% of the nation’s electricity during the first half of 2014. Solar production is up 28%, wind 19% and biomass 7% over last year.

Meanwhile, with the exception of nuclear energy, all conventional sources are producing less. The output from gas powered plants was half of what it had been in 2010 and brown coal powered plants are producing at a similar level to 2010-2012. –

Let’s see what our friends at the Fraunhofer Institute have to say in their comparison of the first half of 2013 vs. the first half of 2014.

German electricity production H1 2013 - H1 2014
Fraunhofer Institute compares energy production between the first half of 2013 and the first half of 2014.

Although unspoken by power company executives operating in Germany, Spain, and some other European countries, the panic felt by traditional power generators is due to the massive changes in ‘their’ market since 2009.

Things move slowly in the utility industry — ten years is seen as a mere eyeblink in time, as the industry changes very little decade over decade. Recent changes must be mind-blowing for European power company executives.

European Union renewables by Eurostat — Renewable energy statistics. Licensed under Public domain via Wikimedia Commons This map displays 2012 results with a total of 20-30% renewable energy for 2012, but in 2013 renewable energy in Portugal registered 58.3% overall. By 2014, Portugal expects that 70% of its energy will come from renewable energy.

It occurs to me that the end of the conventional energy stranglehold on Europe parallels the ending of Star Wars VI.

Help me take this mask off

It’s a mask to hide behind when conventional power producers don’t want the facts aired.

Fossil and nuclear don’t want their Subsidies or Externalities advertised. Global fossil fuel and nuclear subsides topped $600 billion dollars in 2014, while the externality cost of fossil and nuclear may be as high as $2 trillion dollars annually. That’s a lot of hiding, right there.

Fossil fuel and nuclear power power producers don’t want the subsidies they’re paid to be publicly advertised — and they don’t want the renewable energy industry to have subsidies at all

Externalities are simply another form of subsidy to the fossil fuel and nuclear power industries which often take the form of massive public healthcare spending or massive environmental spending to mitigate the gigatonnes of toxic airborne emissions, or to monitor or repair environmental catastrophes such as oil spills.

Spain has ended it’s Feed-in-Tariff subsidy scheme for renewable energy, while keeping conventional power producer subsidies in place.

Not only that, suddenly homeowners aren’t allowed to collect power from the Sun or harvest power from the wind unless it is for their own use. Electricity cannot be collected by Spanish residents and then sold to the grid for example, nor to anyone else.

Spain’s government has taken it yet another step in a bid to keep the conventional energy companies from drowning in their tears. After a meteoric rise in wind and solar capacity, Spain has now taxed renewable energy power producers retroactively to 2012 and ruled that renewable energy will be capped to a 7.5% maximum profit. Renewable energy returns over the 7.5% threshold becomes instant tax revenue for the government. (Quite unlike conventional energy producers in the country which can make any amount of profit they want and continue to keep their subsidies)

While all of this has been going on, Spain and Portugal have quietly lowered their combined CO2 output by 21.3% since 2012 (equal to 61.4 million fewer tonnes of CO2) thanks to renewable energy.

But you’ll die

Not only has European renewable energy now stepped up to fill the multiple voids due to nuclear power plant maintenance and sabotage shutdowns, it has scooped incredible market share from conventional power producers.

In January 2014, 91% of the monthly needed Portuguese electricity consumption was generated by renewable sources, although the real figure stands at 78%, as 14% was exported. – Wikipedia

Unwittingly, the German and Spanish power companies have provided the highest possible compliment to the renewable energy industry, which, if publicized would read something like this;

We can’t compete with renewable energy that has equal amounts of subsidy. Therefore, remove the renewable energy subsidy while we keep ‘our’ traditional subsidies, until we can reorient our business model – otherwise, we perish!

Nothing can stop that now

Ending the European renewable energy Feed-in-Tariff schemes will only temporarily slow solar and wind installations as both have reached price-parity in recent months — and that, against still-subsidized conventional power generators!

Even bigger changes are coming to the European electricity grid over the next few years. Nothing can stop that now.

Tell your sister; You were right about me

Conventional power producers in Europe provided secure and reliable power for decades, it was what has powered the European postwar success story — but having the electricity grid all to themselves for decades meant that Europe’s utilities became set in their ways and although powerful, were not able to adapt quickly enough to a new kind of energy with zero toxicity and lower per unit cost.

Renewable energy, at first unguided and inexperienced, quickly found a role for itself and is now able to stand on its own feet without subsidies. Quite unlike conventional power generators.

Considering the sheer scale of the energy changes underway in Europe, conventional energy has been superceded by a superior kind of energy and with surprisingly little drama.

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India To Expand National Solar Mission

India To Expand National Solar Mission | 15/07/14
by Guest Contributor

India National Solar Mission
India’s National Solar Mission plans to bring electricity to 400 million citizens in remote regions of the country, who have never had electrical service.

Armed with a new sense of urgency to fix the problems of power supply, rising power costs, and increasing dependence on imported coal, the Narendra Modi-led Indian government is planning to enhance the country’s ambitious National Solar Mission. Currently, the mission entails installation of 20,000 MW of grid-connected and 2,000 MW of distributed solar power capacity by 2022.

Given the resource availability and the demand for solar power, tremendous capacity addition potential remains in India. The government has announced plans that it intends to source 3% of the country’s total electricity demand from solar power projects by 2022. To meet this target, a total installed capacity of 34,150 MW is required, the Ministry of New and Renewable Energy has determined. Thus, the current form of the National Solar Mission would fall short by at least 12,000 MW.

While the MNRE regularly comes up with innovative mechanisms to distribute and allocate solar power capacity among project developers, there are several areas that have not been addressed in the policy. Canal-top solar power projects, something pioneered in Prime Minister Modi’s home state of Gujarat, is among them. This would address yet another and more important problem faced by the country — water scarcity and over-dependence of the agriculture on monsoon.

Net metering and feed-in tariffs for rooftop solar power projects is another missing area. While the state government is likely to have the final say on this issue, the central government can certainly announce incentives to promote the implementation of this policy across the country. This policy has also been successfully implemented in Gujarat and had received financial support from international financial institutions such as the IMF.

Another initiative that could find place in the revised national solar mission is solar parks. Gujarat remains the leading state in India in terms of installed solar power capacity due to its 600 MW solar park, which is the largest in the world. While the MNRE had announced plans to implement several of such ultra-mega solar power projects before the new government took office, it would not be surprising if the Modi government enhances this program.

It is very likely that the “Gujarat model” will be followed for enhancing renewable energy in India as early signs point to the same. The MNRE has scheduled an investors meet in November this year where it hopes to attract investment worth millions of dollars to boost the renewable energy sector, an approach mastered by Mr Modi during his tenure as the Gujarat chief minister.

Photo Credit: Barefoot Photographers of Tilonia / Foter / Creative Commons Attribution-NonCommercial-NoDerivs 2.0 Generic (CC BY-NC-ND 2.0)

This article, India To Expand National Solar Mission, is syndicated from Clean Technica and is posted here with permission.

Doubling Renewable Energy will Save Money & Avoid Climate Catastrophe, says IRENA

IRENA | 5 Jun 2014

A 36% renewable energy in the global energy mix is possible, affordable and helps mitigate climate change

The world faces an important energy choice, according to a new report launched by the International Renewable Energy Agency in New York today. “REmap 2030” says that scaling-up renewable energy to 36% of the world’s total final energy consumption by 2030 is possible, affordable and will keep the world on a trajectory consistent with a CO2 level of 450 ppm, the widely accepted threshold to limit global temperature increase to two degrees Celsius above pre-industrial levels by 2100.

The report demonstrates that the investment cost for this global expansion of renewable energy is offset by savings of up to $740 billion per year on costs associated with pollution from fossil fuels.

Image courtesy of IRENA
Image courtesy of IRENA

The central policy question is this: What energy sources do we want to invest in?

Our data shows that renewable energy can help avert catastrophic climate change and save the world money, if all costs are considered,” said Adnan Z. Amin, Director-General of IRENA, in New York.

In answering this question, ‘REmap 2030’ makes a clear case for renewables. It shows the transition is affordable based on existing technologies, and that the benefits go well beyond the positive climate impact.

Countries today face a clear choice for a sustainable energy future.

Doubling renewable energy to 36% of global energy consumption will reduce the global demand for oil and gas by approximately 15% and for coal by 26%, cutting energy-related pollution and adverse health effects as well as increasing energy security for countries dependent on energy imports. It would also create a net gain of nearly one million jobs by 2030.

Image courtesy of IRENA
Image courtesy of IRENA

We can double the renewable energy share in the global energy mix, but we are not on that path now.

To realize the world’s renewable energy potential, all governments need to step up their efforts. We need to act now. — Dolf Gielen, Director of IRENA’s Innovation and Technology Centre, added.

IRENA recommends focusing on five key areas:

planning realistic but ambitious transition pathways; creating enabling business environments; managing knowledge of technology options and their deployment; ensuring smooth integration of renewables into the existing infrastructure; and unleashing innovation.

“REmap 2030” builds on the analysis of the energy requirements in 26 countries that account for 75% of global total final energy consumption. IRENA collaborated with countries and research institutions in the development of the report, which derives its objective from the United Nations Secretary General’s Sustainable Energy for All (SE4ALL) initiative. The report was launched today at the SE4ALL Forum at the United Nations Headquarters.

To download the full report, factsheets and other materials visit

The ‘Variability’ of Renewable and Non-renewable energy

The ‘Variability’ of Renewable and Non-renewable energy | 29/05/14
by John Brian Shannon John Brian Shannon

The ongoing debate about the effects of the Variability of Renewable Energy on national electrical grids

Merit Order ranking control room
Most utility companies have Merit Order ranking control rooms similar to this one where decisions are made about which power producer will contribute to the grid in real time. Microprocessors make the instant decisions, while humans are present to oversee operations and plan ahead.

Solar Variability

Some people argue that solar photovoltaic (solar panels) produce ‘variable’ electricity flows — and they assume that makes solar unsuitable for use in our modern electrical grid system.

And it’s true, the Sun doesn’t shine at night. Also, if you are discussing only one solar panel installation in one farmer’s field, then yes, there is the variability of intermittent cloud cover to consider, which may temporarily lower the output of that particular solar installation.

But when grid-connected solar arrays are installed over vast areas in a large state such as Texas or throughout the Northeastern U.S.A. for example, it all balances out and no one goes without power as solar panels produce prodigious amounts of electricity during the high-demand daytime hours. If it’s cloudy in one location thereby lowering solar panel outputs, then it is likely to be sunny in 100 other solar locations within that large state or region.

Therefore, solar ‘variability’ disappears with many, widely scattered installations and with interconnection to the grid. So much for that accusation.

NOTE: The marginal ranking (which reflects the wholesale kWh electricity price) for solar is (0) and that ranking never varies. (More on this later)

Wind Variability

The situation with wind power is essentially the same, One major difference though; In many parts of the world the wind tends to blow at its most constant rate at night, which helps to add power to the grid while the Sun is asleep.

In fact, complementary installations of solar and wind help to balance each other through the day/night cycle — and through the changing seasons. There is even an optimum ratio between the number of solar panels and the number of wind turbines to better complement the other, but I won’t bore you with the details.

NOTE: The marginal ranking for wind is (0) and that ranking never varies.

Natural Gas Variability

What? Natural gas is not variable!

Oh really? Over the course of the past 60 years, how has the natural gas price per gigajoule changed? Got you there. The natural gas price has increased by orders of magnitude and wild price fluctuations are quite common.

OK, that’s not ‘output variability’ but it is a variable factor with regard to energy pricing. And that’s a variable that actually matters to consumers.

Natural gas prices have swung wildly over the years forcing utilities to peg their rates to the highest expected natural gas rate. No wonder investors love natural gas!

So there is ‘supply variability’ and wholesale ‘price variability’ with natural gas, which is why it is the last choice for utility companies as they meet the peak demand hours of the day. Gas is a good but expensive option, however, it comes with its own variability baggage.

We won’t even talk about the associated CO2 cost to the environment. (OK, it’s about $40 per tonne of CO2 emitted)

Coal variability

Not to the same degree as natural gas, but coal also faces price swings and potential supply disruptions — again forcing utility companies to set their rates against unforeseeable labour strikes at a mine, a railway, or shipping line — and against coal mine accidents that can shut down a mine for weeks, or market-generated price spikes.

These things are impossible to foresee, so this ‘averaging up’ of the price results in higher energy bills for consumers and better returns for investors.

Yes, there is variability in coal supply, in coal supply lines, in coal power plant maintenance cycles which can have a plant offline for weeks, and coal market pricing. These things can affect total annual output, and is yet another kind of ‘variability’. (Again, that doesn’t factor-in the other costs to society such as increased healthcare costs from burning coal which releases tonnes of airborne heavy metals, soot, and nasty pollutants besides CO2 which some estimates put at $40-60 per tonne emitted — in addition to the environmental cost of $40 per tonne for plain old CO2 emissions)

NOTE: Should we talk here about how much water coal plants use every year? More than all the other energy producers put together, and then some.

Hydro power variability

What? Hydro power is not variable!

Oh yes it is. Nowadays thanks to global warming, many hydro dams in the U.S. can barely keep water in the reservoir from August through November. They cannot produce their full rated power in a drought, in late summer, during maintenance, or during earthquake swarms. Just sayin’ hi California!

An impressive-looking body of water behind the dam is meaningless when the water level isn’t high enough to ‘spill over the dam’. If the water level isn’t high enough to spin the turbines then all that water is just for show. Take a picture!

In 1984, the Hoover Dam on the Colorado River generated enough power on its own to provide electricity for 700,000 homes because the water level of Lake Mead behind the dam was at its highest point on record.

But since 1999, water levels have dropped significantly, and Hoover Dam produces electricity for only about 350,000 homes. — CleanTechnica

And then there is this problem; Global warming and resultant drought conditions mean that some dams are essentially finished as power producing dams for the foreseeable future.

Again, we have output variability; But this time it is; 1) lower power output and variable output due to reduced reservoir levels caused by anthropogenic drought and 2) the months of year that hydro dams cannot produce their full rated power.

Price variability: This is what Merit Order ranking is about

Merit Order ranking is a system used by most electric utilities to allow different types of electrical power producers to add power to the electric grid in real time. Thanks to a computerized grid, this occurs on a minute-by-minute basis every day of the year.

In the German example, electricity rates drop by up to 40% during the hours in which solar or wind are active, and this is what Merit Order ranking is all about; Using the cheapest available electricity source FIRST — and then filling the gaps with more expensive electrical power generation.

Solar and wind electricity are rated at 0 (default) on the Merit Order scale making them the default choice for utility companies when the Sun is shining, or when the wind is blowing, or both.

Why? No fuel cost. That’s the difference. And bonus, no environmental or healthcare hazards with solar and wind either.

Once all of the available solar and wind Merit Order ranking (0) capacity is brought online by the utility company, then (1) nuclear, (2) coal, and (3) natural gas (in that order) are ramped up as required to match demand, according to the marginal cost of each type of energy. (German Merit Order rankings)

NOTE: In the U.S. the normal Merit Order rankings are; default (0) for solar and wind, (1) coal, (2) nuclear, and (3) natural gas, although this order can change in some parts of the United States and around the world. Merit Order is based on cost per kWh only and different regions of the country have different fuel costs.

(The one cost that is never factored-in to the kWh price is the cost of disposal for nuclear ‘spent fuel’ and for good reason, but that’s a discussion for a different day)

The Fraunhofer Institute found – as far back as 2007 – that as a result of the Merit Order ranking system – solar power had reduced the price of electricity on the EPEX exchange by 10 percent on the average, with reductions peaking at up to 40 percent in the early afternoon when the most solar power is generated.

Here’s how the Merit Order works

All available sources of electrical generation are ranked by their marginal costs, from cheapest to most expensive, with the cheapest having the most merit.

The marginal cost is the cost of producing one additional unit of electricity. Electricity sources with a higher fuel cost have a higher marginal cost. If one unit of fuel costs $X, 2 units will cost $X times 2. This ranking is called the order of merit of each source, or the Merit Order.

Using Merit Order to decide means the source with the lowest marginal cost must be used first when there is a need to add more power to the grid – like during sunny afternoon peak hours.

Using the lowest marginal costs first was designed so that cheaper fuels were used first to save consumers money. In the German market, this was nuclear, then coal, then natural gas.

But 2 hours of sunshine cost no more than 1 of sunshine: therefore it has a lower marginal cost than coal – or any source with any fuel cost whatsoever.

So, under the Merit Order ranking of relative marginal costs, devised before there was this much fuel-free energy available on the grid, solar always has the lowest marginal cost during these peaks because two units of solar is no more expensive than one. — Susan Kraemer

It’s as simple as this; With no fuel cost, solar and wind cost less.

Although solar and wind are expensive to construct initially (but not as expensive as large hydro-electric dams or large nuclear power plants!) there are no ongoing fuel costs, nor fuel transportation costs, nor fuel supply disruptions, nor lack of rainfalls, to factor into the final retail electricity price.

As solar panel and wind turbine prices continue to drop thereby encouraging more solar and wind installations, we will hear more about Merit Order ranking and less about variability. And that’s as it should be, as all types of grid energy face at least one variability factor or more.

Only solar, wind, hydro-electric, and nuclear have a predictable kWh price every day of the year. Coal, natural gas, and bunker fuel do not. And that’s everything in the utility business.

Although utility companies were slower than consumers to embrace renewable energy, some are now seeing potential benefit for their business and henceforth things will begin to change. So we can say goodbye to the chatter about renewable energy variability and utility companies can eventually say goodbye fuel-related price spikes.

Buckle up, because big changes are coming over the next few years to the existing utility model that will benefit consumers and the environment alike.