David, Can I ask a question about strike prices? I am under the impression that the strike price is a guaranteed minimum, a floor price and that if the market price is higher, wind farm operators can take that higher price and pay a fairly small fine.
Is that the case, or have I been led up a garden path?
It seems like no governments here in the West are realising the power that nuclear holds. We're too busy pouring money into solar and wind. The UK government has invested over 1.3 billion pounds into solar and wind compared to the 300 million into nuclear. While the 300 million is the most they've invested in the past 70 years... it's not enough, especially with all that money going to wind and solar.
China recently opened a Thorium Molten Salt reactor and are planning to open 150 more nuclear plants between now and 2035... we're falling so far behind. Add to this industrial powerhouses like Germany closed down their last 3 plants in April 2023 to then rely on gas from Russia.. and we all know what happened there.
It seems to me like there's very little thought process behind anything. Why would anyone want their grid running on something that only generates electricity when the conditions are just right? You'll always be relying on something else, whether that is fossil fuels or nuclear to fill in the gaps in energy.
This is without mentioning how much a large scale electrical grid battery system would cost... only to last a couple of years...
I mentioned how they treat it as mass of gas per unit of energy. It's a bit disingenuous because gas is not rock and relatively little rock is removed when drilling a gas well.
Data provided include capacity and charge/discharge, valued at regional reference prices (so additional revenue from providing ancillary services which can be a huge money spinner for some is not included). That allows working out daily averages, and round trip efficiency. The smaller batteries do mostly manage to turn over more than once a day. The larger ones don't do as well on that measure - but are more likely to be coining it on FCAS.
Data provided include capacity and charge/discharge, valued at regional reference prices (so additional revenue from providing ancillary services which can be a huge money spinner for some is not included). That allows working out daily averages, and round trip efficiency. The smaller batteries do mostly manage to turn over more than once a day. The larger ones don't do as well on that measure - but are more likely to be coining it on FCAS.
"The result of IEA’s value adjusted LCOE (VALCOE) metric show however, that the system value of variable renewables such as wind and solar decreases as their share in the power supply increases."
"Nuclear thus remains the dispatchable low-carbon technology with the lowest expected costs in 2025. Only large hydro reservoirs can provide a similar contribution at comparable costs but remain highly dependent on the natural endowments of individual countries. Compared to fossil fuel-based generation, nuclear plants are expected to be more affordable than coal-fired plants. While gas-based combined-cycle gas turbines (CCGTs) are competitive in some regions, their LCOE very much depend on the prices for natural gas and carbon emissions in individual regions. Electricity produced from nuclear long-term operation (LTO) by lifetime extension is highly competitive and remains not only the least cost option for low-carbon generation - when compared to building new power plants - but for all power generation across the board."
Well I never. Milliband Minor, copy out these two paragraphs one hundred times ...........
The Japanese still buy Russian Восточный coal ignoring Western sanctions, especially with supply from Australia being constrained at times. These coals are priced basis 6000kcal/kg. With freight the prices CIF Japan will be around $120/tonne for the Russian and
$155/tonne for Newcastle. So the marginal power cost is $35-45/MWh. JKM (Japan Korea Market) LNG is at 14 $/MMBtu, or $1.40/therm, slightly above European levels. That's about $47/MWh as LNG, and twice that as electricity.
Great analysis. One takeaway should be how location affects the results. We continually see people point to a particular grid and claim if they can do it everyone can.
They point to a cherry-picked moment in time showing great performance. Their assumption being if you can do it once, you can do it 100% of the time and then can be extended to other locations ignoring the impact of capacity factors.
A good example is South Australia which looks good until you look at all the data and realize they can only function with near 100% import/export to Victoria. Selling VRE cheap then buying Coal fired electricity back.
Excellent, as usual, David. There are still way to many who believe VRE are the cheapest form of generation and provide the lightest touch to our planet.
Any why wouldn’t they? Too many powerful and influential people repeat ad nauseum the inexpensive VRE canard, and are rarely challenged.
Until there is a critical mass of people realizing that we cannot completely power our world with non-dispatchable sources, and thermal generation of some type will likely always be needed until a new generator that has not yet been conceptualized comes along.
Thank you for this detailed and penetrating analysis, which sits well with those of mining expert Simon Michaux.
Minerals aren't an issue if you take the conventional approach of outlawing mining anywhere close and ignoring it, placing around it what Douglas Adams referred to as an SEP field (SEP = Somebody Else's Problem). One can gain an impression of what's involved without personal inconvenience and expense by reading Ed Conway's excellent "Our Material World...."
A comment rather than a quibble: as far as I'm aware, the lithium batteries cited wouldn't cope with extended Dunkelflaute, for which the only solution applicable to the UK is gas-powered generation burning natural gas or, according to the Royal Society, hydrogen from electrolysis on a grand scale, the latter requiring a large over-build of wind and solar - peaks to cope with troughs. I've yet to see anything definitive on the amount of storage needed - Michaux reckons it's some weeks' worth.
The greater the penetration of wind and solar, the more alternative sources are crowded out, either by having them run at reduced efficiency, or depriving them of investment.
Intermittent sources don't sit well with baseload nuclear. The rational approach would be to change tack to call a halt to wind and solar and invest in nuclear with a view to replacing existing wind turbines in particular after their short lifespan. Politically it may not be too late to pivot as the main UK parties' manifestos were not avowedly anti-nuclear, and I've lobbied my MP so after the election in July.
However, there's Ed Milliband and his coterie with their financial interests, as you have already covered well.
These are the ramblings of a layman seeker-after-truth - thank you again for your contribution.
Finally, I'm glad to see the back of coal. A few decades ago I was forced to divert along the Trent and had considerable difficulty breathing due to sulphur dioxide from the string of coal-fired power stations.
Stack scrubbers reduced SO2 emissions and particulates to trace levels quite some years ago now. Modern coal fired power stations mainly produce CO2. Isogo Unit 2, which is the world's cleanest coal plant in terms of emissions, has NOx, SO2, and PM emissions comparable to those of a natural gas-fired combined cycle plant.
If it doesn’t change then that’s something significant to show. But I’m surprised it doesn’t change, both Wylfa and Trawsfynydd had to build entire pumped storage systems for buffering before we started getting flexibility from gas
Excellent, informative article as usual David, which as usual exposes the shenanigans being used to convince us that, compared to 'dirty' fossil fuels, low carbon generation technologies have a 'cleaner' overall environmental footprint. Scratch beneath the surface though and you discover it's not true. That huge black column for coal looks very suspect to me. If gas includes gas product then surely coal must include coal product, and is it the figure for open cast mining (which involves far more earth removal) of deep mining, or both?
But to assess the environmental impact of mining for various materials, we should really be looking at the waste material generated per ton of useful material. According to Wiki:
"For every tonne of hard coal generated by mining, 400 kg (880 lb) of waste material remains, which includes some lost coal that is partially economically recoverable."
I assume this is the average for all coal mining methods. Most of it is inert rock waste but there are some toxic components which can leach into soils and watercourses.
So that's 0.4 tonnes of moderately toxic waste per tonne of useful hard coal.
For rare earth mineral mining, we discover the following:
"Both methods [of rare earth mineral mining] produce mountains of toxic waste, with high risk of environmental and health hazards. For every ton of rare earth produced, the mining process yields 13kg of dust, 9,600-12,000 cubic meters of waste gas, 75 cubic meters of wastewater, and one ton of radioactive residue. This stems from the fact that rare earth element ores have metals that, when mixed with leaching pond chemicals, contaminate air, water, and soil. Most worrying is that rare earth ores are often laced with radioactive thorium and uranium, which result in especially detrimental health effects. Overall, for every ton of rare earth, 2,000 tons of toxic waste are produced."
So, for every tonne of useful rare earths produced, necessary for wind turbines, EVs and solar panels, TWO THOUSAND TONNES of mostly toxic mining waste are generated, some of that very toxic waste indeed. Why isn't the Breakthrough Institute telling us about this?
Working backwards on coal we have to assume a plant efficiency, which will be somewhere between about 33% for a depreciated old station (less if used as the UK was, to provide peak power only on cold days, because so much is wasted in warm-up, especially if the plant is not in the event dispatched) up to 50% for a modern HELE plant operated as baseload. Coal quality is another variable, with lignite at perhaps just 2,500kcal/kg against API2 (benchmark imported coal into Europe) at 6,000kcal/kg which is 7MWh/tonne of energy content. So to produce 1GWhe you need 2-3 GWh of coal, which would be 286 tonnes of API2 in a HELE plant or 1,029 tonnes in an old lignite fired plant. Add on something for mining equipment and perhaps transport, although many coal fired stations are minemouth, and for the station itself. Then look at overburden.
The turbines in gas and nuclear power plants use electromagnets, not permanent magnets (which require rare earths). Synchronous generators use rotating electromagnets for their field, which are controlled by an external power source. Wind turbines use permanent magnets to generate electricity from the rotational energy of the blades; hence the need for rare earth minerals.
For WTGs, weight and size need to be minimised because they have to be atop a tall tower, the cost of which escalates sharply with increasing load supported. Hence the use of Nd in generator magnets, etc.
Down on the ground 500 tonnes of turbine and generator rotor provides a good chunk of inertia when rotating at 3000rpm.
Another way to look at it is that renewables create much more useful work and gainful employment for people to do, as all that earth doesn’t move itself
Decreasing the productivity of energy generation is not something to boast about. Effectively you are admitting renewables have low EROEI which is a corollary of high mineral intensity. Low EROEI mean society degrades because there's less surplus energy to support high art, elite sport and academia.
He asked why there were so few machines. The government bureaucrat explained: “You don’t understand. This is a jobs program.” To which Milton Friedman replied: “Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels.”
David, Can I ask a question about strike prices? I am under the impression that the strike price is a guaranteed minimum, a floor price and that if the market price is higher, wind farm operators can take that higher price and pay a fairly small fine.
Is that the case, or have I been led up a garden path?
No, that's not right. If the market price is above the strike price they have to pay the difference back to the LCCC.
It seems like no governments here in the West are realising the power that nuclear holds. We're too busy pouring money into solar and wind. The UK government has invested over 1.3 billion pounds into solar and wind compared to the 300 million into nuclear. While the 300 million is the most they've invested in the past 70 years... it's not enough, especially with all that money going to wind and solar.
China recently opened a Thorium Molten Salt reactor and are planning to open 150 more nuclear plants between now and 2035... we're falling so far behind. Add to this industrial powerhouses like Germany closed down their last 3 plants in April 2023 to then rely on gas from Russia.. and we all know what happened there.
It seems to me like there's very little thought process behind anything. Why would anyone want their grid running on something that only generates electricity when the conditions are just right? You'll always be relying on something else, whether that is fossil fuels or nuclear to fill in the gaps in energy.
This is without mentioning how much a large scale electrical grid battery system would cost... only to last a couple of years...
How are you comparing gas to wind/solar? I'm not seeing it on the charts that are denoted in kg/Gwh.
I mentioned how they treat it as mass of gas per unit of energy. It's a bit disingenuous because gas is not rock and relatively little rock is removed when drilling a gas well.
Great work on this!
You can leaf through the performance of the assorted batteries in the Australian NEM here:
https://opennem.org.au/facility/au/NEM/BALBESS/?range=1y&interval=1M
Data provided include capacity and charge/discharge, valued at regional reference prices (so additional revenue from providing ancillary services which can be a huge money spinner for some is not included). That allows working out daily averages, and round trip efficiency. The smaller batteries do mostly manage to turn over more than once a day. The larger ones don't do as well on that measure - but are more likely to be coining it on FCAS.
You can leaf through the performance of the assorted batteries in the Australian NEM here:
https://opennem.org.au/facility/au/NEM/BALBESS/?range=1y&interval=1M
Data provided include capacity and charge/discharge, valued at regional reference prices (so additional revenue from providing ancillary services which can be a huge money spinner for some is not included). That allows working out daily averages, and round trip efficiency. The smaller batteries do mostly manage to turn over more than once a day. The larger ones don't do as well on that measure - but are more likely to be coining it on FCAS.
In trying to find the electricity price of the Isogo Unit 2 coal plant, I stumbled across this International Energy Agency publication from December 2020: https://www.iea.org/reports/projected-costs-of-generating-electricity-2020
It contains these gems:
"The result of IEA’s value adjusted LCOE (VALCOE) metric show however, that the system value of variable renewables such as wind and solar decreases as their share in the power supply increases."
"Nuclear thus remains the dispatchable low-carbon technology with the lowest expected costs in 2025. Only large hydro reservoirs can provide a similar contribution at comparable costs but remain highly dependent on the natural endowments of individual countries. Compared to fossil fuel-based generation, nuclear plants are expected to be more affordable than coal-fired plants. While gas-based combined-cycle gas turbines (CCGTs) are competitive in some regions, their LCOE very much depend on the prices for natural gas and carbon emissions in individual regions. Electricity produced from nuclear long-term operation (LTO) by lifetime extension is highly competitive and remains not only the least cost option for low-carbon generation - when compared to building new power plants - but for all power generation across the board."
Well I never. Milliband Minor, copy out these two paragraphs one hundred times ...........
The IEA actually has a useful report on global coal markets here
https://www.iea.org/reports/coal-mid-year-update-july-2024/prices
The Japanese still buy Russian Восточный coal ignoring Western sanctions, especially with supply from Australia being constrained at times. These coals are priced basis 6000kcal/kg. With freight the prices CIF Japan will be around $120/tonne for the Russian and
$155/tonne for Newcastle. So the marginal power cost is $35-45/MWh. JKM (Japan Korea Market) LNG is at 14 $/MMBtu, or $1.40/therm, slightly above European levels. That's about $47/MWh as LNG, and twice that as electricity.
Great analysis. One takeaway should be how location affects the results. We continually see people point to a particular grid and claim if they can do it everyone can.
They point to a cherry-picked moment in time showing great performance. Their assumption being if you can do it once, you can do it 100% of the time and then can be extended to other locations ignoring the impact of capacity factors.
A good example is South Australia which looks good until you look at all the data and realize they can only function with near 100% import/export to Victoria. Selling VRE cheap then buying Coal fired electricity back.
Excellent, as usual, David. There are still way to many who believe VRE are the cheapest form of generation and provide the lightest touch to our planet.
Any why wouldn’t they? Too many powerful and influential people repeat ad nauseum the inexpensive VRE canard, and are rarely challenged.
Until there is a critical mass of people realizing that we cannot completely power our world with non-dispatchable sources, and thermal generation of some type will likely always be needed until a new generator that has not yet been conceptualized comes along.
Thank you for this detailed and penetrating analysis, which sits well with those of mining expert Simon Michaux.
Minerals aren't an issue if you take the conventional approach of outlawing mining anywhere close and ignoring it, placing around it what Douglas Adams referred to as an SEP field (SEP = Somebody Else's Problem). One can gain an impression of what's involved without personal inconvenience and expense by reading Ed Conway's excellent "Our Material World...."
A comment rather than a quibble: as far as I'm aware, the lithium batteries cited wouldn't cope with extended Dunkelflaute, for which the only solution applicable to the UK is gas-powered generation burning natural gas or, according to the Royal Society, hydrogen from electrolysis on a grand scale, the latter requiring a large over-build of wind and solar - peaks to cope with troughs. I've yet to see anything definitive on the amount of storage needed - Michaux reckons it's some weeks' worth.
The greater the penetration of wind and solar, the more alternative sources are crowded out, either by having them run at reduced efficiency, or depriving them of investment.
Intermittent sources don't sit well with baseload nuclear. The rational approach would be to change tack to call a halt to wind and solar and invest in nuclear with a view to replacing existing wind turbines in particular after their short lifespan. Politically it may not be too late to pivot as the main UK parties' manifestos were not avowedly anti-nuclear, and I've lobbied my MP so after the election in July.
However, there's Ed Milliband and his coterie with their financial interests, as you have already covered well.
These are the ramblings of a layman seeker-after-truth - thank you again for your contribution.
Finally, I'm glad to see the back of coal. A few decades ago I was forced to divert along the Trent and had considerable difficulty breathing due to sulphur dioxide from the string of coal-fired power stations.
Stack scrubbers reduced SO2 emissions and particulates to trace levels quite some years ago now. Modern coal fired power stations mainly produce CO2. Isogo Unit 2, which is the world's cleanest coal plant in terms of emissions, has NOx, SO2, and PM emissions comparable to those of a natural gas-fired combined cycle plant.
Yes, I hinted at it. The charts would go off the scales.
What about material intensity differences for the changes in transmission and distribution systems required?
That's a very good point. I've not seen anyone try and calculate that.
This paper has some ballpark numbers in tonnes/km for various materials.
https://www.sciencedirect.com/science/article/pii/S0921344920305176
Basic data on the current grid here
https://www.nationalgrid.com/electricity-transmission/who-we-are/running-our-network/substations-pylons-and-overhead-lines
A full renewables grid would be 3-4 times the size, because of low capacity factors and long distance from generators to demand.
For the buffered figure you have excluded nuclear - why is that?
Because it doesn't change and I didn't want the chart to get too busy.
If it doesn’t change then that’s something significant to show. But I’m surprised it doesn’t change, both Wylfa and Trawsfynydd had to build entire pumped storage systems for buffering before we started getting flexibility from gas
Excellent, informative article as usual David, which as usual exposes the shenanigans being used to convince us that, compared to 'dirty' fossil fuels, low carbon generation technologies have a 'cleaner' overall environmental footprint. Scratch beneath the surface though and you discover it's not true. That huge black column for coal looks very suspect to me. If gas includes gas product then surely coal must include coal product, and is it the figure for open cast mining (which involves far more earth removal) of deep mining, or both?
But to assess the environmental impact of mining for various materials, we should really be looking at the waste material generated per ton of useful material. According to Wiki:
"For every tonne of hard coal generated by mining, 400 kg (880 lb) of waste material remains, which includes some lost coal that is partially economically recoverable."
https://en.wikipedia.org/wiki/Coal_refuse
I assume this is the average for all coal mining methods. Most of it is inert rock waste but there are some toxic components which can leach into soils and watercourses.
So that's 0.4 tonnes of moderately toxic waste per tonne of useful hard coal.
For rare earth mineral mining, we discover the following:
"Both methods [of rare earth mineral mining] produce mountains of toxic waste, with high risk of environmental and health hazards. For every ton of rare earth produced, the mining process yields 13kg of dust, 9,600-12,000 cubic meters of waste gas, 75 cubic meters of wastewater, and one ton of radioactive residue. This stems from the fact that rare earth element ores have metals that, when mixed with leaching pond chemicals, contaminate air, water, and soil. Most worrying is that rare earth ores are often laced with radioactive thorium and uranium, which result in especially detrimental health effects. Overall, for every ton of rare earth, 2,000 tons of toxic waste are produced."
https://hir.harvard.edu/not-so-green-technology-the-complicated-legacy-of-rare-earth-mining/
So, for every tonne of useful rare earths produced, necessary for wind turbines, EVs and solar panels, TWO THOUSAND TONNES of mostly toxic mining waste are generated, some of that very toxic waste indeed. Why isn't the Breakthrough Institute telling us about this?
Working backwards on coal we have to assume a plant efficiency, which will be somewhere between about 33% for a depreciated old station (less if used as the UK was, to provide peak power only on cold days, because so much is wasted in warm-up, especially if the plant is not in the event dispatched) up to 50% for a modern HELE plant operated as baseload. Coal quality is another variable, with lignite at perhaps just 2,500kcal/kg against API2 (benchmark imported coal into Europe) at 6,000kcal/kg which is 7MWh/tonne of energy content. So to produce 1GWhe you need 2-3 GWh of coal, which would be 286 tonnes of API2 in a HELE plant or 1,029 tonnes in an old lignite fired plant. Add on something for mining equipment and perhaps transport, although many coal fired stations are minemouth, and for the station itself. Then look at overburden.
“for every tonne of useful rare earths produced, necessary for wind turbines”
What about the generators in wind turbines is different such that you couldn’t say this about say gas or nuclear?
The turbines in gas and nuclear power plants use electromagnets, not permanent magnets (which require rare earths). Synchronous generators use rotating electromagnets for their field, which are controlled by an external power source. Wind turbines use permanent magnets to generate electricity from the rotational energy of the blades; hence the need for rare earth minerals.
For WTGs, weight and size need to be minimised because they have to be atop a tall tower, the cost of which escalates sharply with increasing load supported. Hence the use of Nd in generator magnets, etc.
Down on the ground 500 tonnes of turbine and generator rotor provides a good chunk of inertia when rotating at 3000rpm.
Another way to look at it is that renewables create much more useful work and gainful employment for people to do, as all that earth doesn’t move itself
Decreasing the productivity of energy generation is not something to boast about. Effectively you are admitting renewables have low EROEI which is a corollary of high mineral intensity. Low EROEI mean society degrades because there's less surplus energy to support high art, elite sport and academia.
https://davidturver.substack.com/p/why-eroei-matters
He asked why there were so few machines. The government bureaucrat explained: “You don’t understand. This is a jobs program.” To which Milton Friedman replied: “Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels.”
We could if we owned the mines and there wasn’t a free market
It was Communist China under Mao. I know you're a fan of a Great Leap Backward.
If it’s not broke, break it - first rule of re-engineering
Makes sense, good article. In compliment, see K.T.'s Energy Return on Investment article:
https://tucoschild.substack.com/p/the-joule-ers-accountant-and-energy
Yes. I did a similar article last year.
https://davidturver.substack.com/p/why-eroei-matters
Excellent article David, 101 principles will continue to serve!
I am subscribed.
Best, TC
These comparisons, cost, space used, minerals required are interesting and ingenious but the killer is the ABC of intermittent energy.
Three lines and a few paras of support that almost fits on the back of a large envelope.
It's impossible so just stop it!