Morning Ed: Energy

Will Truman

Will Truman is the Editor-in-Chief of Ordinary Times. He is also on Twitter.

Related Post Roulette

12 Responses

  1. Oscar Gordon says:

    En1 & En5 are so tightly linked they are essentially the same article (5 being part 2).Report

    • Cato’s piece in En1 never explicitly states the underlying assumption: current US federal government policy on how the power grids should be operated is sacred. That policy requires that essentially all power sources be dispatchable — that is, the operators can provide guarantees like, “We will deliver 500 MW of power from 10:00 to 11:00 on the third Tuesday of next month.” It’s not surprising that Cato makes that assumption; they were one of the well-funded advocates for making that the official policy.

      The US national labs have all done nuts-and-bolts studies of the Western Interconnect and shown that an all-renewable grid will work fine there… but the operation no longer meets the “dispatchable” policy requirement. Reliability is the result of statistically diverse sources and a moderately greater capacity for moving bulk power around, rather than power plants that provide individual guarantees. The states in the Western Interconnect have, at least IMO, elected to head down that path*. At some point, this will put them in conflict with the feds.

      Due to geographic isolation, Xcel Energy in Colorado is in practice largely exempt from the federal policy. 28% of their delivered power is currently from renewable sources; they are ahead of schedule to reach 55% by 2026; and anticipate 100% before 2050. It’s not that it can’t be done, it’s that it can’t be done under certain operating assumptions.

      * There are a number of factors contributing to that decision. Eg, thermal power plants — coal, natural gas, nuclear — require cooling water, which is a scarce commodity. Comanche 3 in Pueblo, CO is probably the last coal-burner that will be built in the West. One of the factors that added to the lengthy period from initial plan to operation was the time needed to find and purchase sufficient water rights.Report

      • Oscar Gordon in reply to Michael Cain says:

        Two questions:

        1) It’s a common refrain from the members of this forum that my normal position that most regulation is the result of capture or rent seeking is wrong, and that the vast majority of regulation has sound rationales behind it. Therefore, I am assuming that the dispatching rules CATO championed were not crafted solely to ensure that GE had a good couple of decades selling Co-Gen turbines across the country. There had to be some kind of societal or policy problem the rules were meant to address, right?

        2) Assuming the answer to 1) is ‘Yes’, then is there a serious movement among Utilities, states, interconnects, what-have-you to rewrite the rules to mirror what the Western Interconnect is trying to do? I.E. is CATO defending the dispatching rules because no one is proposing any serious alternatives to the dispatching rules?Report

        • At least a couple of the economists that did the original work for CATO have recanted — they now assert that in practice, a market system with all the bells and whistles needed to provide long-term stability doesn’t produce electricity at lower prices or with higher reliability than the old rate-of-return regulatory system.

          In practice, CATO’s “separate generation from distribution and have a neutral operator run a market to match them” approach was overly simplistic. The PJM is the premier market-based system in the US. First, they have more than a thousand generating companies and dozens of utilities — a situation that doesn’t exist elsewhere in the country — so everyone is, as the economists say, a price taker. Second, almost from day one, they’ve had to keep tinkering with the system. They had to tightly couple the transmission market with the generation market in order to avoid some of the problems of the California debacle. They had to add a spinning reserve market. They had to add a capacity market to meet future needs. There’s now a distinct non-zero chance that the thing will come largely apart because the operator hasn’t been able to find a way to meet both federal rules for markets and some states’ rules mandating renewable share. That’s mostly just the nature of the beast. Absent vast amounts of storage, large scale use of renewables means you need both interstate-scale geographic diversity and rules that say non-renewable sources only get used for demand in excess of what renewables can provide. FERC says that combination violates their rules and/or the enabling federal statutes.Report

          • Oscar Gordon in reply to Michael Cain says:

            But what was the problem CATOs policy was supposed to solve?

            Absent vast amounts of storage, large scale use of renewables means you need both interstate-scale geographic diversity and rules that say non-renewable sources only get used for demand in excess of what renewables can provide. FERC says that combination violates their rules and/or the enabling federal statutes.

            Hence my second question: Is there a movement to change FERCs rules to favor renewables?Report

            • J_A in reply to Oscar Gordon says:

              In FERC’s defense, when the dispatchability rule was made, essentially all generation, except probably nuclear and small run of river generation, met some sort of dispatchable requirement. That that’s no longer the case is a matter or technological advances, not that the rule was wrong when made.

              Non dispatchable renewables are creating havoc with the commercial and technical operations of power systems everywhere. I don’t really know that anyone has really figured out completely.

              A good havoc to have, but havoc nevertheless.Report

    • Richard Hershberger in reply to Oscar Gordon says:

      I used to know a guy whose entire world view was centered around hippie-punching. If hippies liked something, he was against it. If hippies were against something, he was for it. Naturally he was a big fan of burning hydrocarbons. At one point–perhaps ten years ago–he argued that battery technology was as good as it could possibly get. He didn’t make a coherent argument for this, or even really an incoherent one. It was simply that he was just smart enough to understand that battery tech was the limiting factor on renewables, so that was that. QED.Report

      • Oscar Gordon in reply to Richard Hershberger says:

        I’m not even remotely against the de-carbonization of power generation. I’m just not enthralled with schemes to make it look profitable by sneaking in rules that are effectively subsidies to make it look profitable.

        Be upfront about the costs, and about the tax support being given. Also be upfront about the time horizons that Utilities operate under. Most people don’t understand that Utilities make massive capital investments that are paid for over decades. CA was stupid to tell Utilities that they have to pay retail rates for rooftop solar, rather than generation rates. That just makes it harder for Utilities to pay down their debts and gives them a strong incentive to oppose green energy initiatives when they are still paying for the last turbine or boiler upgrades.

        As for battery tech, we’ll get there, I have no doubt. It’s just silly to make rules about generation requirements before the technology is even close to being in the ball park. I mean, if governments are going to do that, we should just declare the population of the US cancer free by 2050.Report

        • Richard Hershberger in reply to Oscar Gordon says:

          We subsidize any number of industries for reasons a lot worse than reducing pollution. If we want to argue against subsidies, go ahead. But if the argument is “so we should start by not subsidizing pollution reduction” I will be unsympathetic. Be upfront? I don’t know what that means. It’s not as if the subsidies are being kept secret. Should we receive a notification of the cost of building and maintaining a road before we drive on it?Report

          • Oscar Gordon in reply to Richard Hershberger says:

            I’m fine with subsidizing something, if it’s important*, while it’s getting it’s feet under itself. But just straight up subsidize it. Don’t subsidize it by forcing A to pay $X to B, and then holding B up and saying “Look, it makes good economic sense!”

            Just give B a tax credit, or give A a break on interest rates, or something along those lines. And be upfront. We need to ween ourselves off of oil/NG, and nukes are a political hand grenade, so we are supporting solar and wind (and hydro?) while we work out the kinks and make the transition.

            *For various values of ‘important’Report

            • Right. Subsidies are fine (or can be) but we have to do a good job of differentiating “Cheap for the end consumer” and “cheap”. A lot of the discussion have historically done a very good job of that.

              I’ve said things along these lines before about higher ed: We need to not only have cheaper college options for families, but also cheaper overall.Report

  2. Michael Cain says:

    En7: The article doesn’t mention that the plutonium in spent fuel is almost useless for building weapons. It’s an isotope problem — too much Pu-240 causes the bomb to “fizzle”, and too much Pu-238 creates serious heat problems. Isotope separation for plutonium at reasonable scale is a currently-unsolved technical problem, although it is possible that laser separation may eventually be good enough to make it practical. OTOH, Japan’s plutonium stockpile is a marvelous supply of fuel that is suitable — or could easily be made suitable — for use in fast-neutron commercial reactors. The only commercial fast-neutron reactors in operation are two in Russia.Report