The Cost of Not Using Nukes & Coal for Electricity

David Shaffer has a story in the StarTribune about Xcel’s proposed rate increases. It sounds like Xcel wanted to increase rates by 10.7%, but it’s going to end up somewhere closer to 5%.

But, one thing that stood out to me was a denial of Xcel’s request to bill ratepayers for the increasing costs of dirty power sources:

The judge also concluded that Xcel shouldn’t be allowed to immediately bill ratepayers for some of the escalating costs associated with upgrading Xcel’s 42-year-old Monticello nuclear power plant or its expenses related to a catastrophic 2011 accident at its giant coal-burning plant in Becker, Minn.

If the cost of dirty power is increasing, shouldn’t those who choose to use dirty power feel that pain? In addition to the long term costs to the air we breath, there are real costs to maintaining carbon belching and nuclear waste generating plants.

This reminded me to take a look at my Xcel bill to get a feel for how much I’m currently paying to avoid dirty power by using Xcel’s Windsource program. As of now, the cost is higher, but take a look at how much:

Xcel Windsource Charges

69 cents over a month. After taxes on that net 69, I paid around 77 cents extra to rely upon wind over dirty power. That’s not breaking the bank.

And, you know what would close that gap even further? Letting Xcel charge dirty power users for the costs of maintaining their dirty power plants. Eventually, that WindSource net energy cost could go negative, and that’s when people who don’t care enough about the air we breath to pay an extra 1.6% for power will go green based solely on cost.

17 thoughts on “The Cost of Not Using Nukes & Coal for Electricity”

  1. I’m still mightily impressed that your monthly usage is 335kWh! MN residential average is closer to 800kWh.

    (Even for that average 800kWh, Windsource would cost a whopping $1.75/month or so)

    I try really hard to keep our usage down, and I still average around 400kWh.

    ISTR you had a post about once when Windsource actually *did* go negative. It’s not all that far off, all we need is a slight bump in fuel costs, which has happened before, and will likely happen again.

  2. Well, you’re not figuring in the subsidy the corporation which built the windmill got, and continuing subsidies for wind power production that lower your costs at the expense of other ratepayers.

    But the big problem with the wind is that it doesn’t blow sometimes, and blows too hard at other times. At those times, there’s got to be a conventional generator ready and waiting to take up the load.

    In the UK, they’ve solved this problem by contracting with diesel-powered generator owners. It’s very expensive, and there’s wonderful profit in building a diesel generating station to take advantage of the generous payments. Ratepayers, a.k.a. customers, are billed for these costs.

    Oh, and diesel generators are very dirty. Much more dirty than natural gas, and somewhat more dirty than coal. So, there’s more carbon going into the air, and lots of money lining well-connected pockets. And lots of dead birds and bats.

  3. @Eric, looks like you remembered correctly. I did have a bill where it was $4.02 cheaper due to Windsource since Xcel wasn’t able to hit me with a fuel surcharge.

    @Gordon, are you suggesting that Xcel will stop generating or buying coal, natural gas, nuke, solar, etc. if people opt-in to Windsource? Are you suggesting that there are no subsidies of other forms of power generation?

    This is all about improving our clean energy ratios, which makes your slippery slope argument hard to take seriously.

  4. There are many potential solutions to the grid balance problems that might arise some day with substantially more wind generation online than we have now. I’d expect that building diesel generators would probably be one of the last ones chosen due to expense, inefficiency, & environmental harm.

    Until then, gas peaker plants, mid-term wind forecasting, and demand response measures will probably continue to do quite well.

  5. At those times, there’s got to be a conventional generator ready and waiting to take up the load.”======== Isn’t that what Enron did? Get power and move it around to where it was needed? This whole thing with windmills has got to be as much about Transmission as it it about Generation. As slow as it is, by the time it’s streamlined, someone will have learned how to harness cold fusion and all the whirligigs will be obsolete.

  6. @Rat, power companies deal with power from a large variety of power sources and energy production techniques already so it’s nothing to be alarmed about. They produce and buy power already, and most do so with businesses models far more sustainable than Enron’s.

    One trend we’ll probably be seeing more of as the costs of solar continues to decrease is decentralized production. Few people will be willing to go fully off the grid at this point since the cost of local storage is far higher than tapping the grid for supplemental power.

  7. Eric, Ed,

    Were that it were so simple. But Germany, which bought into solar in a huge way, has seen their top three solar panel companies go bankrupt, despite huge subsidies. And the plans to put more windmills offshore are running up against reality: floating windmills subject to North Sea storms are rather vulnerable to expensive damage.

    Germany’s fluctuating power is so bad that neighboring countries are refusing to buy it. The Germans manufacturers have made it clear they won’t stand for any more damaged motors caused by the unsteady supply.

    And it nearly happened here, a couple of years ago. In Texas, an unforecast drop in wind nearly took down the whole grid.

    Natural gas is cheap, getting cheaper, and it’s utterly reliable. And since you don’t need backup generators burning fuel, just in case, it’s cleaner.

    By all means, buy your own windmill and disconnect. But don’t require me to buy your unsteady excess.

  8. @Rat, I searched for “german manufacturing quality of power” with the expectation that I’d find a boatload of search results supporting what you claimed, but I didn’t find anything matching. Could you hook me up with a link or two?

    It’s interesting to hear about wind somehow being unique in its ability to fluctuate. We’ve had unplanned outages at every type of power generating facility to date. The grid’s not perfect, but it’s defeatist or defensive to pretend that wind power is unique.

  9. Here’s one commentary on Germany’s renewables problem:

    http://www.telegraph.co.uk/comment/9559656/Germanys-wind-power-chaos-should-be-a-warning-to-the-UK.html

    When I have more time I’ll bring a couple more.

    Ed,

    Wind is unique in that it is very unpredictable. Even solar, which goes up and down depending on cloudiness, is more reliable. And they’re doing their best these days, what with Europe being covered with bird slicing, bat chomping windmills, to come up with sophisticated algorithms to balance the loads as one bank of turbines sags, while another surges.

    Still, it’s very hard on electric motors. They want a nice, steady voltage, or they break. And why Germany, where it’s pretty much cloudy from October to March, went heavily for solar power is a mystery to anyone who can read a climatology report.

    JW,

    “Wind capacity” is a very common lie used to justify spending ratepayer and taxpayer money to line the pockets of windmill erectors. Wind turbine farms never run at even 50 percent capacity; they average between 25 percent and zero. As the best locations are used up and developers go after poorer choices, that number will drop.

    A natural gas turbine runs at 100 percent of capacity, and can be throttled up or down as load requires.

    The impact of depending too much on wind was evident last winter in the UK, as a week-long cold snap settled in. Winds dropped to zero. The grid came so close to total collapse that the only thing that saved it was requiring industrial users to shut down. That’s why they’re spending a ton of money to line up diesel generators–dirty diesel generators–to take up load when the wind fails.

    The Germans are quietly building new coal and gas stations to be on hand to back up renewables. This makes a mockery of the stated goal of the whole exercise: cutting carbon emissions. Instead, they’re increasing emissions, and charging users handsomely for the cost of it all.

    The Australians have a great word that describes how clever folks take advantage of government incompetence to line their pockets: rort. As in, “They totally rorted the program.”

  10. @Gordon, are you sure that a column written by a guy who doesn’t believe cigarette smoke or asbestos cause cancer is a good source of scientific information?

  11. @Gordon, You have a lot of assertions here, basically no citations. The burden is on you to back them up, I think.

    Let’s pick one that’s easy to check:

    “A natural gas turbine runs at 100 percent of capacity”

    That’s not correct. If you look at Table 5.2, Average Capacity Factors by Energy Source, 1998 through 2009 (page 48) of the Electric Power Annual 2009 (http://www.eia.gov/electricity/annual/archive/03482009.pdf) you’ll see that in 2009, combined cycle natural gas had a capacity factor of 42.2%, other natural gas was at 10.1%. Non-hydro renewables had a combined capacity factor of 33.9%. All combined sources had a capacity factor of 44.9%.

    As for the “wind on the grid damages electric motors” assertion, that’s interesting too. Germany has around 8% wind on the grid (http://www.euronuclear.org/info/encyclopedia/p/pow-gen-ger.htm) Xcel MN produced 11.9% from wind, Xcel CO was at 16.6% in 2012 (http://www.xcelenergy.com/staticfiles/xe/Corporate/Environment/Xcel%20Energy%202012%20CRR%20Overview.pdf)

    And yet, I’ve not seen news stories about industrial motor failures in MN or CO.

  12. The levelised costs in that table account for capacity factor.

    Also, NG has a lower capacity factor in the US than wind.

  13. I’ll freely admit that it’s difficult to get good information. An Xcel “feel good” brochure is not a reliable source to me. One reason is that they’re claiming 12 percent of Minnesota’s electricity came from wind.

    Now Germany, which says they can, in theory, produce 50 percent of their electric load by wind, only manages eight percent. Yet Xcel says they’re getting 12 percent, with a lower capacity. Are Minnesota engineers somehow twice as good as German ones?

    It doesn’t help that the German government isn’t a reliable source. They’re too politically invested, and they massage the text and the data. It happens here, too: Ethanol is considered to be a serious boondoggle by everyone except corn farmers and ethanol producers. It’s sucking aquifers dry and raising the cost of food worldwide. And our latest price increase in gasoline–from $3.29 to $3.69–is a result of scarcity mandated by the government in the renewable fuels law.

    But our governments, state and federal, are unable to end a program of subsidies and mandates. The ethanol folks promised decades ago that they only needed “help” for a few years. We’re still paying.

    Meanwhile, natural gas generation is proven, cheap and getting cheaper. It doesn’t blight the landscape with bird chopping windmills. It’s steady, reliable and efficient. But it’s easy to get a permit to build 20 windmills. Try getting one for a gas plant.

    Look, I used to be a big fan of renewables. It seemed like a great way to get power cheaply. But in the real world, it’s far more complex. If we had a way to store wind and solar power so that it could be reflowed in a steady manner, it would be great.

    But the only place I’ve seen that work is one place in Scotland, where they use that power to pump water uphill to store it in a lake. That water is then used to generate hydropower. It’s not particularly efficient to pump water uphill, but it works.

    Unfortunately, geography doesn’t allow that arrangement elsewhere. And these days, no one is going to stand for creation of artificial lakes that drown privately owned land, even if you can find places where it might work.

    If it’s such a good idea, it should work without subsidies. Let it stand on its own, and if it’s good, folks will come. But forcing everyone to pay so that investors can reap windfalls is corrupt and stupid.

  14. From May 2012 to April 2013, wind share of net generation in MN was 14.2%. The highest monthly share came in April 2013 at 19.7%.

    http://www.eia.gov/electricity/data/state/generation_monthly.xls

    If one is against wind generators based on avian mortality, be prepared to destroy all buildings, power lines, cats, motor vehicles, pesticides, and cell towers, since they cause 98.6% of non-natural bird deaths in the US. Ground airplanes, too, since they kill as many birds as wind generators.

    http://www.fs.fed.us/psw/publications/documents/psw_gtr191/Asilomar/pdfs/1029-1042.pdf

    In the US in 2011, the capacity factor of wind was 30%, compared to 22% for natural gas.

    http://www.eia.gov/totalenergy/data/annual/showtext.cfm?t=ptb0802b
    http://www.eia.gov/electricity/annual/html/epa_04_03.html

    Also, the levelized cost data quoted previously for wind, coal, and nuclear already factors in capacity factor and does not include subsidies, as I previously stated. Simply going to the link I provided and reading the document, one would be able to learn this.

    Though I realize some people are fond of wild narratives, particularly those that fit an ideological bias, since they are easy to consume and regurgitate, they are no substitute for objective data. Luckily, much objective data exists and is readily accessible for anyone with an Internet connection, should they wish to investigate actual facts.

  15. @Gordon, would you consider Xcel’s annual report to be a “feel good” brochure? It contains the breakdown of energy generated by source. Coincidentally (if that’s the way you’d prefer to look at it) the number they published for wind was . . . 12%.

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