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In the earlier post I summarized my estimates on the limits to capacity utilization if production is done either with wind or solar power.  Here I will (over)think implication a bit further.  mthOn their own wind and solar power implied strong restrictions on achievable utilization rates. Overbuilding generation capacity (and associated distribution system) could increase utilization rates, but at the expense of ever increasing amount of wasted power and underutilized power lines. Storage could also help, but smoothing out the production profile would require large amount of underutilized storage capacity. There doesn’t seem to be away around this. Low capacity factor of variable power source has cascading effects elsewhere. If not fixed capacity utilization of end users would be strongly constrained and most likely too low to enable profitable business. On the other hand attempts to fix the problem would imply underutilized generators, power lines, and/or storage. Technical developments will not change this since the problem is not due to specific technology or costs.  Are there ways around these problems? Of course…

If you are planning to invest in a new plant producing for example solar panels and you find production to be unprofitable with utilizations rates implied by solar power, your first choice is simply not to invest. If economic preconditions do not exist, production never materializes even if we might find such production desirable or even critically important. Production would either not happen or move to a place where higher utilization rates are possible. Various shades of gray might also exists as they do today especially in the developing world. If production process is such that you could for example store some parts for later use, it might be possible to outsource only those phases which require reliable power elsewhere. Of course, this still opens up possibilities for those not saddled with the same constraints.

Another option is not to rely solely on variable renewables, but to have a fleet of dispatchable generators delivering the power services variable renewables cannot deliver. Today this most likely implies burning fossil fuels, but in principle hydro and nuclear power would work as well. This again implies overbuilding infrastructure and is unlikely to be economically optimal. However this fundamental reliance on existing infrastructure is the order of the day in the developed world.

Visions where variable renewables dominate are aspirational marketing material while on the ground unholy alliance seems to have quietly developed between many renewable and fossil fuel lobbyists. Cozy reliance on fossil fuels enables somewhat more variable renewables to be built before technical limitations become apparent. Supporting this modest buildup (with public money) buys fossil fuel industry social licence as well as removes long term threat of actual decarbonization. Petty about the climate, but the constituency for whom this is actually a priority is weak.  This is welcome also for many politicians who are only too happy to project an appearance of activity (at relatively low cost) while their policies imply changes which have a marginal impact on the actual problem. This relates to deep decarbonization in a same way as “champagne socialism” relates to revolution of the proletariat.

I recently read a very interesting book “Fossil Capital” by Andreas Malm on the history of industrial revolution in the United Kingdom. (Note: book is only worth reading until chapter 12. There the author got tired of thinking.)  Malm focused on the question of why coal and steam engine won over water power in the early decades of the 19th century. Remarkably coal did not win because water resource would have been insufficient. There was still plenty of untapped potential in the UK. Also coal did not win because it was cheaper. In fact, mechanical power from steam engines was more costly and many were of the opinion that it was also of worse quality. So what happened?

There were many overlapping reasons. For example, factories followed labour to the cities. In the early 19th century it was already clear from the demographics that labour was to be found in the cities. Water power was dispersed and getting meek labour to run the machines in the middle of nowhere was harder. In fact, owners of water powered factories were relatively more dependent on the apprenticeship system providing them with, what can apparently with some justification be called,  slave (child) labour. Water power was also more variable than steam, which made it even more important to have well behaved labour that would be willing to work long and irregular hours.

However, it turned out labour did not think their position was optimal (go figure) and started to make noise. This resulted in legal (and actually enforced) restrictions on working hours and gradual improvement on workers position. (It also induced technological change that made large number of especially troublesome workers redundant, but let us not talk about that here.) Owners did not of course like these limitations and lobbied against them, but relatively speaking those using steam found it easier to adapt. They could live with the shorter and more regular working week since reliable power could enable high productivity during working hours. Coal became the backbone of british industrial might and the road was opened for more broadly shared economic growth.

So can we learn something from this? I think we can since economic and social arguments for why coal won have not disappeared. If you listen to todays renewables promotion, you will be constantly bombarded with statements about how huge the potential energy resource is and how cheap it is…or is going to be any day now. Might it be a cause for concern that these two reasons were also promoted by water proponents in the 19th century Britain just when coal was taking over? Might there be a risk, we are discussing beside the point? If excessive reliance on variable renewables end up limiting capacity utilization, is there not a similar risk that water power faced in the 19th century? Who bears the cost of lower utilization? Labour? Lower salaries and/or more irregular working hours anyone? Vacations in the winter since solar power produces mainly in the summer?  If push comes to shove and such questions have to be asked, I am quite sure any techno-fetishes we might have, will evaporate.

To me conclusion seems clear. It is unlikely humanity will ever be primarily powered by variable renewables. If fuel etc. costs for dispatchable generators are high compared to the cost of electricity from variable renewables, wind and solar might be economically justified as a part of a more diverse fleet of generators. However, it is also possible that on economic grounds they will remain niche producers whose existence is dependent on subsidies and political good will. Future will tell.

This will probably be a fairly long post mainly summarizing findings from my simple toy model….so proceed at your own peril.  For a while I have been interested in how the properties of the power source affect the end user. For the consumer different power sources deliver very different value, but the public discussion is typically centered (more or less honestly) on costs. I think one issue of great relevance is the capacity utilization and the aim of this post is to record my studies on the matter. In particular I wish to explore the variable power sources such as wind and solar in the context of capacity utilization. My thoughts are in the end closely related to “capacity factor rule” discussed by John Morgan, but I approach the issue from somewhat different angle.

What is a capacity utilization  and why it matters?

Capacity utilization compares realized production with what could be possible. The concept seems to be somewhat fuzzy since theoretically maximum output could be defined in different ways. However, for an advanced economy capacity utilization is high, for example, in EU it is typically higher than 80% with a scary dip during last financial crisis. In an undeveloped country capacity utilization is lower, for example around 55% in Bangladesh. This makes sense, since things like poor infrastructure hamper production that might have otherwise happened. High capacity utilization is needed especially when lots of capital is spent since otherwise production could not cover capital costs. If high capacity utilization cannot be ensured, investments requiring large amounts of capital will not happen (unless one finds someone to pay for the losses).

In a developed economy capacity utlization is not really limited by the power supply. We get power from the plug whenever we need it. Capacity utilization is limited more by things like rising labour costs if one aims for maximum production or perhaps uncertainty on whether or not a buyer can be found for the product. However, our electricity production follows the demand and not all power sources can do that. Some view it desirable that consumers should in fact adjust their consumption according to weather. This raises the question: “How will this limit the capacity utlizations?”

This is a hard question and I can only scratch the surface here. I assume a “machine” or factory that can use certain amount of power and what is produces is proportional to its electricity consumption. I will then either use wind power or solar power as a power source and also add a storage to help even out the power variations. If there is excess power and storage is not full, we fill it. If power supply is lacking, we drain the storage. (I assume 80% round trip efficiency.) How much power machine can use, is a variable. It probably makes no sense for this to be higher than the wind or solar capacity, but if it is reduced utilization rate for the machine can probably be increased. It should be noted that the estimates below do not (of course) use the economists definitions for capacity utilization. This is more likely to give an estimate on the additional limitations on capacity utilization on top of all those other factors that are operating in any case.

So let me quickly summarize what I find…

Figure 2: Wind power source limited capacity utilization as a function of “machine capacity” (i.e. what fraction of power source capacity it can use) and storage (days at average wind production). Wind power data from UK 2013.

Figure 3: same as Figure 1, but using solar power as a source. (Production data from Germany 2015.)

Figures 2 and 3 show my rough estimates for the “capacity utilization” as a function of machine capacity and amount of storage (hours of average power production). If machine capacity is equal to the capacity of the power source, capacity utlization is limited by the capacity factor of the power source. As machine capacity is reduced and/or storage is added capacity utilization can increase. However it is very hard to get to a situation where power source would not be a factor substantially limiting the overall capacity utilization.

In terms of capacity utilization wind power tends to beat solar power which has strong seasonal production profile. Removing that is hard since it would require massive amounts of seasonal storage which would (by definition) be used only by about once a year.

As machine capacity is reduced, the “factory”can run at a higher capacity utilization, but then certain fraction of the produced power will be wasted although waste can be reduced somewhat by storage. If we aim for high capacity utilization, wasted fraction can unfortunately be substantial. The unit cost of useful energy will rise with increasing waste.

Figure 4: Fraction of wasted wind output.

Figure 5: Fraction of wasted solar output. (Once daily variation is covered it is very hard to change things by adding even more storage.)

Waste can be reduced with storage, but then the question arises that how efficiently this storage is being utilized? Figures 6 and 7 illustrates this. If we add so much storage that capacity utilization is high and amount of wasted power is low, we tend to have a large amount of under utilized storage capacity lying around. Storage that is combined with solar power tends to be more efficiently used because of regular daily variation.

Figure 6: How efficiently storage is being utilized with wind power. (Here the scale is more arbitrary. I assumed full utilization amounts to one full cycle a day.)

Figure 7: Same as figure 5, but with solar power.

I suspect that these estimates are in fact too optimistic. If I choose a point from figure 2 with relatively high “capacity utilization”, the power supply for the machine is still quite erratic as seen in Figure 8.

Figure 8: Example power input to the machines when machines powered by wind had a capacity of 0.26 of wind capacity and system had 36 hours of storage at average wind output. Still a mess.

Maybe there are processes that do not mind this, but there are  also plenty of industrial processes where steady power supply is needed and where abrupt power cuts will undermine the economics of the plant. (It would be interesting to have real world examples of production economics as one changes between power sources. Do you know any? I suspect that current way of delivering power to industries in developed economies is close to optimal for their needs.)

I think I will stop here and discuss later what I think this will imply. Main point here is that nature of the power source will affect the capacity utilization and have economic consequences that are not accounted for when myopically computing the “cost” of electricity for the power sources.

I have earlier discussed Deutche Bank and its less than stellar predictions. Due to recent news I will return to the topic briefly. Deutsche Banks reports and predictions on solar power have been breathlessly hyped in the renewables marketing web sites and links from there have polluted the discussion more broadly. It should be common sense that investment bankers should not be used as a credible source let alone on a matter which requires long term thinking extending over a century. Unfortunately, such common sense seems to be in short supply.

So now solar company SunEdison is on the brink of collapse. How did that happen when only a year ago Deutsche Bank was encouraging everyone to buy this company that was bound to be part of imminent solar revolution?

Deutsche Bank recommendations early 2015

I guess it happened the same way bubbles always pop. We had analysts optimistically predicting wonderful things… just open your wallets quickly and you can get part of the fun. That paper rubish banks had created had to be sold somewhere and surely you should do it to save the planet AND for profit. Here is a funny chart for those who believed the gospel.

Nailed it

All the while company imploded Deutsche Bank was recommending “buy”. This was going on still 4 weeks ago.

“Buy Buy Buy! God dammit, why aren’t you buying!” Few weeks ago. (Poor guy. The site)

Here is are few samples how things unfolded with scant warnings about risks. Sad really.

Screen Shot 2016-01-02 at 18.53.51

Mark Jacobson brought to you by Shell.

Finns have traditionally had a low self-esteem and have been very concerned what others think of them. Running into Mark Jacobsons 100% RES energy scenarios gave me a rare chance to come in touch with my inner Finn. For this I wish to thank him. His “visions” are visibly marketed online for example at website and National Geographic with a help from none other than Shell. (For the actual papers and associated pile of excel files see here.)  Reading his papers and excel files made me wonder, what have we done to deserve his wrath?

Let me elaborate. As a backbone of our energy system Mark Jacobson and his accomplices grant Finland 29 GW capacity of onshore windpower, 27 GW offshore, and almost 50 GW of photovoltaics. For reference notice that our maximum electricity demand is around 14GW in the winter and 9 GW in the summer. Total energy consumption is somewhat less than 400 TWh. In size we are about 1% of EU which has around 90GW of photovoltaics installed. So according to Mark on a windy sunny day production could be more than 10 times our demand and around 7 times the maximum (winter) demand. Our installed PV capacity would be comparable to whole PV capacity in EU today which has, after all, spent around 10 years constructing it. This all seems a bit intimidating.

Considering how off-scale this is it is noticeable that Jacobson spends very little time  spelling out the details of how exactly are we supposed to cope with implied massive swings in production. From his excel file I cannot find details on what he assumed for our grid and how much his assumptions end up costing. He also says there won’t be any new hydropower (we have 3.2 GW), but there might be pumped hydro storage. They tell us “…we restrict our calculations to assume each country can generate all of its annually-averaged power independently of other countries, since ultimately this goal may reduce international conflict.” So that water will be sloshing somewhere in Finland since otherwise we might invade Sweden and Norway (and Russia while we are at it). Makes sense. If I read this correctly our hydropower is supposed to be configured in such a way that it pumps water upstream at massively higher powers than downstream. Somehow I feel we need a 2nd opinion from someone with actual competence in engineering. (Maybe Mark meant that we were supposed to use hydrogen storage somehow? Well, no he didn’t. According to him just 1.24 GW, out of total average demand  close to 30 GW, or about half of the transport demand was diverted to electrolysis. Something very weird is happening behind the scenes and I have a nagging suspicion science fiction is involved.) Also note that our electricity demand is never less than about 6GW so potentially we are supposed to shut down the country for Mark. No problem!

Furthermore, why doesn’t Jacobson tell us where  those mythical pumped hydro storages are? If you have a look at the topographic map of Finland, you will quickly realize why this is a critical question.

We are a mountainous country…by dutch standards.

Finland is a flat country. If you drain our biggest lake Saimaa (the funny shaped water area between Lappeenranta and Joensuu) you might get around 5 TWh of energy. It feels unnecessary to point out that this cannot be done. Furthermore, you cannot even pump all that much water into the lakes since that would flood the cities, summer cottages, roads, and railways next to the lakes. Jacobson should probably add an army of goons into his employment figures to ensure the continuing happiness of our sad little country when his plan is being implemented.

Jacobson also suggests we get about 20% of our energy needs from photovoltaics. This made me laugh. Here is a picture from the moment when my power consumption for 2015 peaked.

20% of energy from photovoltaics.

20% of energy from photovoltaics. Sure Mark! Whatever you say

Picture is taken towards a calm lake (very little wind) when I was leaving a sauna during Christmas. Since lake was freezing the scenery was pretty, but too few photons of right energy hit my phone. Sauna was powered by bioenergy (aka trees) and consumed several tens of kW of power. In the heating stage probably closer to 100kW. (Sauna stove was emitting ridiculous amounts of particulate matter and all sorts of carcinogenic carbage. It was also very enjoyable and I warmly recommend it. We do it with kids.)

Of course a Finn would check the scenario not just for Finland, but also our dear neighbour Sweden. Sweden is about twice our size and has per capita GDP that is roughly comparable to ours. To remind you, according to Jacobson we are supposed to get around 20% of our energy from photovoltaics. Sweden on the other hand is inflicted just with around 1% share.


Mark lets us play on our strengths -- sunshine!

Mark lets us play on our strengths — sunshine!

According to Jacobson upfront capital costs for the electricity generators alone would be more than $225 billion. This is about the same as our GDP. What about Sweden? In Jacobson’s scheme Sweden will pay less than $170 billion in upfront investment costs. Less than us even though they are twice our size. Thanks Mark. What is it? IKEA? Nobel committee? ABBA?

In Jacobson’s vision employment in our energy sector grows from about 38000 to 130000. Doesn’t this mean massive productivity reduction in our energy sector? Isn’t that a bad thing?  In the topsy-turvy world of 100% RES discussions this is of course not so. Jacobson instead talks as if we are winning by spending more.  By inverting the logic of productivity increases that I suspect pretty much all economists (whether on the left or right) agree on, he talks of our $8.15 billion/year “earnings due to jobs” as if we are winning. Sweden would end up employing only about half what our energy sector would do (quarter on per capita basis) and they would get just 0.96 billion in earnings due to jobs. Take that Sweden!

How does Jacobson actually end up with the claim that his vision would make any economic sense? He gets this basically by estimating body counts from PM 2.5 emissions and then multiplying this by “the statistical value of life”. In this way he claims that in 2050 Finland emissions would kill 600-6000 people and cost us maybe more than $100 billion or about 30% of our GDP every year. Wow! This is crazy on steroids. First of all I think this is inappropriate use of the concept “statistical value of life” and 2nd it doesn’t pass the sanity check. Here PM emissions have declined drastically in past decades thanks to cleaner fuels, filters, centralized power plants replacing small scale burning etc. What am I supposed to learn from Jacobson’s figures? That in 80s when emissions were much higher, we lost basically all our GDP because of pollution? Also, is there someone who has a life insurance for 17 million. Isn’t maybe 100000-200000 more typical…1% of their claim? Jacobson and his friends assign pollution problems to the energy system as a whole and ignore that lot of it here is actually caused by small scale burning of bioenergy. They also deny the existence of alternative ways to address pollution concerns. History already tells they are incorrect in this assumption.

Small particle emissions from Finnish transport sector. Green for road transport, blue for water. (Lipasto, VTT)

In summary, thanks for dropping by Mark! Now don’t let the door hit you on the way out.

P.S. Jacobson’s work is a treasure trove of nonsense and since I seem to like poking on carbage, I will probably return to it later. I name this post with “Part 1” for that reason.

Added 4.1.2016: I realized that Jacobson’s plan also assumes we spend about $12 billion on wave devices (almost 2GW capacity). It is a wonderful source of energy especially on the time of the year we need energy most. (More on this theme from the article by Soomere and Eelsalu. I thank @alexharv074 for the link.)


Does that white stuff matter? Photocredit La Brionnaise

One of the more absurd phenomena in energy discussions is the reverence accorded to Wallstreet. If an investment bank says something nice about renewables this is treated as uniquely credible message. That it is often people with left wing sympathies who do this, makes the phenomenon even more absurd. This is how the process works. Bankers write non-peer-reviewed report on something. Then copy-pasters in environmental/renewables media credulously repeat what was said (minus conflicts of interests statements) without ever linking to the original report. Here is a recent example from UBS and Citigroup (also in Guardian). If you read the report there is not much. Strong claims are backed up mainly by hot air and some comparisons are so absurd as to be comical. For example, one talking point was that electric vehicle is already cost competitive  with a conventional car. What was not highlighted by the bankers, was that their “conventional car” was Audi A7, “an Audi limo for those who like to drive as well as waft about in luxury”

In recent years some of these reports have been written by Vishal Shah for the Deutsche Bank. He has told us, for example, how “solar will Dominate World Energy Supply in Just 15 Years” or in 2014 how second solar gold-rush was imminent.  Both reports had “important conflict disclosures” and readers were encouraged to read them elsewhere. (They disclose important financial stakes in companies whose stocks they recommend.)

But who is Vishal Shah? Googling him reveals that before being hired by Deutsche he contributed to the success of Lehman Brothers (and Barclays). Being a financial analyst he has left behind a trail of recommendations which help us to understand how clear his crystal ball actually is.

  • In 2008 Shah predicted that polysilicon prices will increase by another 20%. As if on cue, prices collapsed.
  • He promoted Evergreen solar stocks. The company promptly drifted to bankruptcy. Evergreen
  • He has been cheerleading First solar, whose stock collapsed. Firstsolar
  • He has also been cheerleading Suntech Power, which (this is getting boring isn’t it?) went bankrupt. Suntech
  • When the second gold rush was supposed to begin, solar stocks proceeded to drop substantially. Goldrush_begins

His ranking among the analysts is less than stellar. Poor guy. I don’t in fact think that Shah is worse than other analysts. He has the misfortune to work in a field that has been a lousy investment. He came to my sights only because he happens to generate very visible nonsense on a topic that I follow rather closely. It is a cause for concern when people base their faith on fighting complex long term challenges such as climate change on analysts whose work is, after all, about selling financial instruments during the next quarter. These people do not have a special crystal ball that makes them any wiser than random person from the street.
Photo 24.5.2015 8.57.20

I glanced at the IEA report “Energy technology perspectives 2012”. (There is also a 2015 version, but I didn’t have access to that. Annoyingly IEA charges dearly for these reports so that even though they are commonly referred to in discussions, they are not widely available.) In their baseline 2DS scenario IEA estimates cumulative saving (savings in fuel minus investment costs) over 6DS scenario of 26 trillion US dollars by 2050. Interestingly enough they also have a “high” nuclear scenario where they tolerate more nuclear power than in the baseline. In this scenario the savings are largest, 27.9 trillion. Strangely enough this result was buried to the page 384 of the report. Wouldn’t it have been useful to highlight this since there are plenty of people and (believe it or not) politicians who don’t know this? After all this ignorance might make them promote policies that are counter productive in fighting climate change.

IEA_ETP2012_TableOfScen 2015-06-02 12:42:18_mod

We can also look at the required investment level to follow the 2DS scenario. Here IEA assumes large cost reductions for renewable energy sources. This might or might not happen, but let us just accept this for now. I highlight some relevant numbers from the report in the following table.

IEA_ETP2012_NeededInvestments2015-06-02 12:34:38

Source Investment 2030-2050 per year (billion) Production 2050 (TWh) TWh/billion
Nuclear 119 7918 66.5
Wind 167 6145 36.8
Solar 232 5988 25.8
Wind+solar 399 12133 30.4


As you can see, even though IEA has baked in massive cost reductions assumptions into solar and wind by 2050, they still deliver less than half as much electricity per investment than nuclear (for which IEA didn’t seem to assume learning effects). IEA 2DS baseline is not a cost minimizing scenario, but presumably reflects sufficiently conventional wisdom that authors believe is more palatable for IEA funders.

What would happen if we were to simply divert investments spent from more costly decarbonization options to nuclear? That 399 billion for wind and solar would then enable about 14000 TWh/year more carbon free electricity than the 2DS baseline. This would be enough to eliminate coal, coal+CCS, natural gas, natural gas+CCS, biomass+waste, and biomass+CCS from the electricity mix at 2050 with more than 1000 TWh left over. As these sources of electricity disappear, more than 100 billion a year is also saved in investment costs and lots more in fuel costs. Based on the difference between IEA 4DS and 2DS scenarios, I estimate around 20 trillion additional cumulative savings in fuel costs. Not bad, I would say given the speculative nature of CCS technology, environmental and social impacts of bioenergy schemes, and the need to decarbonize also other sectors than electricity production. (Incidentally, it tells something of the absurdity of current energy discussions, that many celebrate large investments as a good thing. It doesn’t seem to matter what the investment actually buys. More expensive the better, because that means more investment and larger business opportunities in “cleantech”.)

Do I think this will happen in the near future? Of course I don’t. If there would be a wartime-like urgency, who knows, but as it stands such scale up is not going to happen. However, even if unrealistic this option is MORE realistic than the renewables-only party line. It is more realistic economically, technically, and in terms of material limitations. Since it is not going to happen, (as I have said many times before) we can look forward to much more than 2 degrees warming.

In its latest assessment report IPCC concluded that in order to get climate change under control world needs massive expansion of nuclear power, renewables, energy efficiency, and CCS. I am a numbers guy and therefore I was delighted when I found a useful database for many of the mitigation scenarios IPCC relied on in its latest report. There is a database for the scenarios and additional information and assumptions used on many scenarios can be found in another database. I found this very interesting since articles reporting on the scenarios often explain the underlying assumptions of the models poorly. I will focus now on how the modellers approached nuclear power. I didn’t have the patience to go through all scenarios and I focused on those with 450ppm CO2 target that contained all technologies optimally (allegedly). I found that quite a few modellers dealt with nuclear power in a way that left me wondering if their modelling is simply poorly disguised ideological propaganda.

Some main approaches used to influence how well nuclear power does in the models relative to variable renewables (wind and solar):

  1. In many models nuclear capacity increases massively. Hundreds and hundreds of reactors are constructed, but amazingly nobody learns anything! Capital costs for nuclear power are typically kept almost constant throughout the decarbonization pathways. On the other hand learning effects and technological evolution are assumed for other energy sources. For wind and solar power these are often assumed to be very dramatic and there are learning effects even for fossil fuels. So this tough love only seems to apply to nuclear power.
  2. Many models assume large cost reductions for wind and solar. In the end, this is not much more than a wishful guess.
  3. Some models assume anomalously large capacity factors for wind and solar. See for example, “Message Ampere2-450-FullTech-OPT” scenario. Capacity factors for wind are almost 40% while for solar power they use about 25-31% over the course of the century. Since real figures are more like half of the assumed figures, the model drastically underestimates the costs for wind and solar. (IMACLIM scenarios seem to do the same)
  4.  Some models (IMACLIM in particular) assume very low capacity factor for nuclear.  “IMACLIM Ampere2-450-FullTech-OPT” has a nuclear capacity factor of just 45% in 2100 while for wind and solar they have 36% and 38% respectively! This doesn’t just roughly double the cost of nuclear in these models, but also underestimates the costs for wind and solar.
  5. Some models (REMIND and MERGE-ETL) postulate a world running out of uranium together with no technology development for nuclear. This “peak uranium” then limits the role nuclear power plays in decarbonization.

Figure 1: Nuclear power in Remind Ampere2-450-FullTech-OPT scenario. Massive increase and then…

Let me discuss the sillyness of the last trick in more detail. Figure 1 shows what REMIND scenario got for nuclear power when all technologies were used “optimally”.  So massive increase in nuclear power until middle of the century and then rapid decline. Decline is caused by uranium supplies running out as soon as light water reactors with once-through fuel cycle have used 23 million tons of uranium. This is very strange for several reasons.

First, this number doesn’t seem to bear any clear connection to known uranium resources which are about third of this figure. Modellers probably felt that using known resources as an upper limit would have been too stupid to pass the laugh test.

Second, mineral resources have a habit of increasing together with demand since increasing demand stimulates increasing investment in exploration and technology development.  In the past one hundred years copper production has increased by an order of magnitude. All this time world has been “running out” of copper in about 40 years. Uranium is not especially rare element and there is no reason to believe we are running out of it anymore than we have for other metals such as tin which has about the same crustal abundance.

Third, from where does the assumption of no technology development come from? Wasn’t this supposed to be a scenario where all technologies are allowed? For nuclear power technologies that that improve the fuel efficiency by about two orders of magnitude are already known.

Fourth, why is there resource constraint only for nuclear power? The resource constraints are more severe for wind and solar power (and for bioenergy). In Figure 2 I show an image I picked up from a european study on critical metals for energy technologies. The elements with greatest supply risks are used in the construction of wind and solar power. (By the way, the only nuclear related element on the list is the low risk hafnium for control rods.) Figure 3 I picked up from a fairly recent Alonso et al. paper. Authors estimated that dysprosium (used in magnets) demand in renewables heavy mitigation scenarios is expected to be a whopping 2600% higher than projected supply already in 2035!


Figure 2: Critical metals for European “strategic energy technologies” according to European commission Joint research centre study.

Figure 3: Expected demand and supply for Dysprosium according to Alonso et al.

Figure 3: Expected demand and supply for dysprosium according to Alonso et al. (2012).

What would happen if we were to apply modellers approach for renewables? Let us just take silver as an example. Silver reserves are estimated at about 530000 tons. Let us assume that “real” resource is 4 times this (remember uranium resource was set at 3 times the known reserves) and that half of this can be used for photovoltaics. There are after all other uses for silver as well. Since 1GW of solar power requires about 80 tons of silver, this means that at maximum we can have about 13TW of solar capacity as opposed to almost 90TW cumulative capacity REMIND modellers extrapolated. Instead of being the largest contributor to the primary energy supply its contribution would fall into 5-10% range. The amount of silver required to construct the solar power in REMIND FullTech scenario is about 13 times larger than the estimated global silver reserves. Now can there be ways around these constraints? Probably there are and maybe we could use less silver, but using substitutes might imply higher costs and worse performance and furthermore, if one was not permitted to use already demonstrated technologies for nuclear power why should imaginary advances be permitted for other alternatives?

What might we get if we remove this silly constraint from the model? Obviously I cannot repeat the exercise with the tools I have available, but we can get a rough estimate. Lets take the growth rate (4.8%) for nuclear power REMIND modellers established between 2020-2050 and just let it grow with the same rate until the end of the century. This is not extraordinary in the context of this model since for wind+solar the growth rate through the century was 7.6% even though capital costs are such the nuclear power seems to have a lower levelized cost of energy (5% discount) throughout the decarbonization pathway. I show the result in Figure 4. Nuclear power would end up dominating the energy supply.

I have a feeling that resource constraint was introduced specifically for this reason. Modellers first did their calculations without the constraint and ended up with a result that they found distasteful. They did not want to go on record with the scenario that might “rock the boat” or give people funny ideas. By introducing the resource limitation for nuclear power they could clip its wings and keep it supposedly as an option while limiting its role to the margin. In fact that strange 23 mton uranium resource limit seems to suggest that over the century LWR:s cannot produce more than maybe around 5% of the primary energy. I suspect that modellers worked backwards and set the resource limitation based on the maximum share of the energy supply they were ready to grant for nuclear power. Not cool.

Figure 4: There, I fixed it!

Figure 4: There, I fixed it!

Then there is PRIMES…sigh. This is a model I encountered few years ago as I was reading EU:s 2050 energy strategy. I remember glancing at the referee report and being troubled by the brief remark on page 6. Referee had asked about rather optimistic cost assumptions to which response was that if capital costs for wind are set higher then the future learning curve can be steeper. To me this suggested that modellers were perhaps fitting model to the fantasy. In the AMPERE database PRIMES scenarios for EU are also included. I was naturally most interested in the Ampere5-Decarb-AllOptions scenario which according to authors is a scenario “with all technological decarbonisation options available and used according to cost optimality; this scenario provides the least cost decarbonisation pathway for the EU.” Sounds interesting! However, as you look at the actual results you notice something weird. The capital costs assumed are such that nuclear (again) has the lowest LCOE throughout the decarbonization pathway. Despite this modellers claim that nuclear generation in EU will decline by 20% by 2050. How is this even possible?

Then I noticed a strange footnote on page 15: “PRIMES assumes that nuclear development has been significantly affected in the aftermath of the nuclear accident in Fukushima in March 2011. Both PRIMES and TIMES-PanEu impose national constraints regarding nuclear, such as countries’ decisions not to use nuclear power at all…” Please tell me that I am reading this wrong. They didn’t just exclude nuclear power from large parts of EU in their “all options” scenario for political reasons and then sell it as the cost optimal one?

I have now outlined several ways in which scenario modellers seem to suppress nuclear power from their reference scenarios where all options and technologies are supposedly on the table. This has also consequences for the other scenarios and comparisons between them. Since modellers suppressed nuclear power already in “the tech neutral” scenarios adding additional anti-nuclear policy, can be presented as not really having major cost consequences.

Figure 2: The box on the left has nuclear power in it and the box on the right had it removed. Amazingly it looks almost the same as the other empty box!

Figure 2: The empty box on the left has nuclear power in it and the box on the right had it removed. Amazingly it looks almost the same as the other empty box!

Since I am a bad boy I will conclude with some rough estimates on what would it take to replace (gasp!) solar and wind power at the end of the model scenarios with nuclear power that generates the same amount of electricity. I simply estimate the required nuclear capacity (90% CF) and use modellers assumptions about capital costs. Required yearly outlay is roughly total capital required divided by the lifetime of the plant. I will use 30 year lifetime for wind and solar and 60 years for nuclear. (Numbers are in billions of 2005$…I think.)

Model Wind+solar capital Nuclear capital (Wind+solar)/year Nuclear/year
Remind 450-FullTech-OPT 74540 62753 2485 1046
Message 450-FullTech-OPT 40620 64150 1354 1070
IMACLIM 450-FullTech-OPT 5680 5765 189 96
Primes Decarb-AllOptions (EU) 1430 826 48 14
Primes HIEFF-NoCCS-NoNUKE (EU) 1555 900 52 15

In all models the required yearly outlay (at 2100 or 2050 for PRIMES) for energy supply is dramatically lower if we replace wind and solar capacity with nuclear power. This despite the fact that MESSAGE and IMACLIM assumed unrealistically high capacity factors for variable renewables. It is remarkable than even though this kind of chicanery was going on behind many models, IPCC still ended up concluding that nuclear power must expand massively. This is perhaps partly because not all scenario builders were intellectually dishonest about this issue and some models ended up, for example, with ten fold increases in nuclear capacity. On the other hand I am afraid that all 450ppm scenarios are utterly unrealistic….and don’t get me started on their absurd bioenergy projections. 

P.S. I spent some time copying the data I was interested in from the database. Interface seems a bit uncomfortable for that. Here is a link to some of the data I extracted.

P.P.S.  For laughs you might want to check IMACLIM model with 550 ppm goal and CCS excluded. Since the original one was very strongly dependent on CCS one would imagine that ruling it out would have interesting consequences for the energy mix. See what modelers assumed for the capital costs of nuclear here to suppress that out of control (critical?) nuclear growth early in the century.



In case you have missed it, there is apparently amazing energy revolution going on in Germany. Photovoltaics are an in integral part of the associated hype. I checked the rates of monthly installations.

Figure 1: Monthly installations of PV in Germany 2009-2014.

Figure 1: Monthly installations of PV in Germany 2009-2014.

Installations increased rapidly from the early 2009. What caused this increase? I might of course be wrong (I don’t think I am), but this increase coincides quite nicely with the collapse in the German share of the photovoltaics industry and increasing Chinese dominance in the marketplace. Germans had adjusted their feed in tariffs based on German manufacturing costs. This attracted Chinese who could produce same thing far more cheaply and gave rise to investment bubble in Germany. Subsidies were sold  as buying Germans a large share of an exponentially increasing export market. Instead German producers of photovoltaics panels collapsed. Strangely enough silence on this has been deafening and and the same argument is used to sell similar policies in other countries as if nothing happened. (Does anyone know a country were subsidies are NOT justified by capturing export markets?)

Figure 2: Market shares of photovoltaic cells

What causes those spikes in installation rates? As has been demonstrated time and time again, installations are driven by subsidies and they tend to peak just when some form of subsidy is about to expire. Sure enough, if I check what has happened to feed-in tariffs in Germany I find a clear correlation with installation rates and FiT changes (see Figure 3).

Figure 3: Fractional change in the Feed in Tariffs

Figure 3: Fractional change in the Feed in Tariffs

Since the monthly data is more noisy I finally show the results over half a year periods. It is quite interesting that decrease in installations since the start of the Energiewende buzz has been exponential (to a good accuracy) with a half-life of about a year. The current rate of installations with 25 year lifetime, implies around 50GW of solar capacity which translates to less than 10% of German electricity consumption. We are saved!

Figure 4: Installations over half a year periods. For your convenience I makrk the start of the Energiewende hype with an arrow.

Figure 4: Installations over half a year periods. For your convenience I mark the start of the Energiewende hype with an arrow.

Suomessa “uusia Nokioita” puhkutaan kiihkeästi ja niiden syntymää on ennustettu mm. tuuli- tai aurinkovoiman ympärille. Ensimmäinen kuva vertailee Nokian viime aikaista kurssikehitystä Vestaksen, Gamesan ja First Solar:n kurssikehitykseen. Vestas on maailman suurin tuuliturbiinien valmistaja, Gamesa neljänneksi suurin ja First Solar valmistaa ohuita aurinkopaneeleita. Vertailu Nokiaan on ehkä osuvampi kuin mitä hypettäjät tarkoittivat. Vestaksen kohdalla Tanskan hallitus on jopa kokenut tarpeelliseksi todeta, ettei aio tulla apuun mikäli Vestas ei pysty maksamaan velkojaan. Olisi kiva tietää mitä ovat ne kuningasideat, joiden turvin suomalaiset yritykset pärjäisivät tuossa ympäristössä, kun suuremmatkin ovat vaikeuksissa? Ainakaan yrityssaneeraukseen ajautunut Winwind ei niitä ideoita keksinyt.

Osakekurssit: Nokia, Vestas, Gamesa ja First Solar

Osakekurssit: Nokia (punainen), Vestas (ruskea), Gamesa (vihreä) ja First Solar (sininen)

Onko kyse pelkästään yksittäisistä yrityksistä. Ehkä sektoreilla kokonaisuudessaan menee loistavasti? Seuraava kuva vertailee eri sektoreille sijoittavien ETF:ien kurssikehitystä. Ei hyvältä näytä. Parhaiten pärjäsit, jos laitoit säästösi fossiilisiin polttoaineisiin. Muilla hävisit rahaa tuon vertailujakson aikana. Vähiten hävisit ydinvoimalla, tuulivoimaan sijoittamalla hukkui liki 80% säästöistä. Jos sijoitit säästösi aurinkovoimaan, on niistä jäljellä pelkät rippeet.

ETF vertailu: Öly+kaasu (sininen), ydinvoima (punainen), tuulivoima (ruskea) ja aurinkovoima (vihreä)

Mutta ei hätää. Lopetettuaan ensin omat satsauksensa aurinkovoimaan esimerkiksi Shell arpoo, että aurinkosähkö voi olla merkittävin teholähde…vuonna 2070. Sitä odotellessa se voi rauhassa myydä enemmän öljyä ja kaasua. Ja jos arvaus on väärä? No, kuka siitä oikeasti 60 vuoden päästä välittää sen enempää kuin me piittaamme 1950-luvulla tehdyistä ennusteista? Shell on varmasti valmis tuolloinkin myymään hiukan lisää öljyä ja kaasua…sopivaa korvausta vastaan. Tärkeintähän on kivan vision tuoma imagohyöty nyt. Rikkana rokassa Shell muuten visioi myös, että fossiilisten polttoaineiden kulutus kasvaa merkittävästi ja aurinkosähkön osuus primäärienergian kulutuksesta on korkeintaan noin 20%. Ilmastovaikutus ei heidän mukaansa ole ehkä niin paha, koska CCS. Miksi en ole vakuuttunut?

Lisäys 21.3.2013: Kiinalainen Suntech,yksi maailman suurimmista aurinkopaneelien valmistajista, on juuri ajautunut konkurssiin. Edes kiinalaiset eivät pysty tekemään tulosta näillä markkinoilla.

Earlier, I wrote on how crucially an unreliable sources of power such as wind depend on fossil fuels. Based on real world production data from around the world, I noted that even with massively distributed production wind power is very variable and necessitates a reliable backup power source (typically from fossil fuels) which must be able to produce essentially all the power society consumes. A way around this problem would be a massive energy storage, but I found the size of the required storage to be unreasonably large.

One typical response to findings such as these, is to brush them aside by claiming that even if true, the results will not matter since we will have many different renewable energy sources acting together (as if there is some “harmony” in two essentially random signals). Most importantly quite a few people base their vision of future energy production on a mixture of wind and solar power. For this reason I felt the need to return to this problem so that also solar power is considered. Unfortunately, I have yet to find a good source for real world production data for solar power. The best I have come up with are images (typically of the daily production), but raw data is better hidden.

However, since solar power (without storage) production is proportional to insolation we can use meteorological data as a reasonable starting point. US has a National solar radiation database which has large collection of insolation modelling data around USA. From this data they have also formed a “typical meteorological year 3 (TMY3)” datasets. (There are some quirks in the construction of TMY3 that I frown upon. For example, after El Chichón and Mount Pinatubo eruptions insolation was reduced, but these periods were apparently excluded from the TMY3 as atypical. Of course they were atypical, but they are still things that do happen and whose effects must be considered. However, I suspect that the effect due to eruptions was still minor in US.) As my insolation data I take the average of TMY3 data from six different class I sites (class I has the best data) in three different states: Prescott Love and Tucson Airport in Arizona, Arcata Airport and Fresno Yosemite Airport in California, and Denver Airport and Limon in Colorado. These sites have an average latitude similar to southern Spain.(Why did I choose these sites? Well, being lazy I started from the entries listed in alphabetical order by states and picked the first southern states I encountered.)

Somewhat annoyingly only hourly data is provided. We know from BNC among others that solar power (especially PV) can have large swings on shorter timescales. Therefore, this limitation may have important consequences. Nevertheless, let us ignore the torpedoes with an understanding that the solar power we talk about here is such that sufficient storage has been already implemented to smooth out hourly variation in production. So keep in mind, that the starting assumptions for solar production have a bias towards the optimistic side. Since the production data for wind power is given every 5 minutes I will linearly interpolate the solar insolation data to deduce the production of solar power every 5 minutes (link to the data here). As in the earlier study the data corresponds to one year starting July the 1st. and the consumption data corresponds to the Bonneville Power Authority load with a possible scale factors to suit my needs.

Now that we have rather massively distributed production of both wind and solar power, what do we find? In Fig. 1 I show the average insolation from six US locations (the wind data I have discussed earlier). Daily variation is apparent as is also the large seasonal variation between summer and winter. In this system the solar power has an impressive 20% capacity factor. OK, now that we have the relevant data let us then proceed to check what backup requirements we have if we are to integrate this solar production in such away that production and consumption match (as they must).

Figure 1: The average insolation as an average over 6 sites in USA. The figure shows both the yearly data as well as an example of one random 7 day period.

If we choose the installed solar capacity such that the solar power produces the same amount of electricity over the year as our model society consumes, we find that a massive 55% percent of the electricity is generated with reliables (typically fossil fuels). These reliable power plants must be able to produce 97% of peak demand and they are running at a capacity factor of 36%. Solar power itself sees its capacity factor drop to 9%. These results are essentially caused by the seasonal variation of insolation (too little production in the winter) and the fact that solar power reliably produces nothing when it is dark. It is perhaps not worth pointing out that this scenario is not compatible with the goal of decarbonizing our societies.

How about mixing solar and wind? Since the sun shines during the day when consumption is higher one can guess that unreliables production matches the consumption better if there is some amount of solar in the mix. On the other hand the solar output varies even more than the wind output since, unlike wind, it predictably produces nothing when it is dark. (Of course, if the sun stops shining for good, eventually the winds disappear as well.) So presumably one shouldn’t push the fraction of solar production too high. This suggests some “sweet spot” for the fraction of installed solar capacity if we are to match the production of wind and solar optimally to consumption.

Figure 2: How well the solar and wind production match the consumption as a function of solar capacity.

In Fig. 2 I show how the function
Σ(Production-Consumption)2/Σ Production2
behaves. If production matches the consumption exactly (as it does in the real world), this function vanishes. We note that optimally the installed solar capacity should be about 21% of the installed wind capacity. (Not that this split gives rise to production which matches consumption. It is just somewhat less worse than other choices.)

For comparison, European renewable energy council and Greenpeace postulate a more ecumenical figure close to 50/50 for the split between wind and solar. (Since no explanation for this split was apparent, cynic in me is left wondering if this choice simply reflects the relative turnovers of respective industries which presumably correlate with spending on lobbyist.) However, if we are to use such a mix and produce as much power with wind and solar as we consume, it turns out that we need reliable power plants with a capacity of 91% of peak demand. They will have a capacity factor of 17% and amount to 24% of total production. Combined capacity factor of wind and solar has now dropped to around 19%. This case is presented in Figs. 3 and 4. In my earlier study with just wind power I found that fossil fuel power plants accounted for 21% of production (and with a capacity 88% of peak demand). So adding this much solar into the system has actually made things worse! The culprit is again the seasonal variation of insolation which reaches minimum during the winter (in northern hemisphere) when the consumption is often greater.

Figure 3: A snapshot of the production and consumption during a one week interval when solar and wind capacities were equal.

Figure 4: The yearly production and consumption together with the reliables output when solar and wind capacities were equal.

(As an aside: Another way to understand the challenges involved is to compare standard deviations relative to mean for wind and solar production as well as for the consumption. For the consumption this number is around 0.15, for wind power it is much larger 0.47, and for solar power it is huge 1.32. However, keep in mind that the underlying distributions are anything but normal. They cannot really be described properly by just the mean and standard deviation.)

How about choosing the solar capacity to be the “optimal” 0.21 of wind power capacity? Then we need reliable power plants with a capacity of 89% of peak demand. They will have a capacity factor of 14% and amount to 19% of total production. So, yes! Adding solar power to the mix can sometimes help, by reducing the electricity produced with fossil fuels from 21% to 19%. Unfortunately, the required capacity of reliable power plants is actually slightly higher than with wind only. I will not dare to compute the cost of CO2 abatement under such a scenario.

Figure 5: Solar capacity is 21% of the wind capacity. Weekly snapshot.

Figure 6: Solar capacity is 21% of the wind capacity. Yearly data.

Finally, few words about storage. Maybe adding solar into the mix would help us to live with a smaller energy storage? Unfortunately, also that hope is misplaced. Due to seasonal variation systems with solar power actually need MORE storage. In the earlier study with only wind power I estimated that in order phase out fossil fuels AND keep the lights on, we need an energy storage for about 9% of yearly production. Repeating the exercise (storage doesn’t decay and 20% round trip loss) for the system combining wind and solar, we find that we need storage for 13% of production in the 50/50 case while about 10% is enough with solar capacity limited to 21% of wind capacity. (Also, in the 50/50 scenario we would have to be able to store energy at a rate which is nearly 2.5 times the average power consumption of the surrounding society. Otherwise capacity factors are reduced and/or dependence on reliables reappear.)

To conclude, I note that adding solar power and wind without massive storage to the mix does next to nothing to remove the need for fossil fuel based energy infrastructure. Scenarios based on wind and solar power are fundamentally reliant on fossil fuels and sooner this is understood the better it is for climate. Currently the mirage of purely unreliables based energy production essentially maintains the use of fossil fuels for as long as the eye can see both for technical and financial reasons.

While doing these exercises I occasionally get a feeling that I am fencing with a tetraplegic. You might say this is not sportsmanlike, but unfortunately the political reality is that the mirage of solar and wind based solutions is a tetraplegic which hampers us from confronting the real and difficult issues with respect to climate change. By offering an easy “alternative” this mirage effectively acts as a cover for the damage anti-nuclear activities are causing for attempts to mitigate climate change. Unfortunately fencing must continue since this cover must be removed.

(This posting also appeared as a guest post in Brave New Climate.I encourage you to read the discussion there.)

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