Reducing subsidies for renewable energy

[Astronuc]

Germany eyes swift cuts in renewable energy subsidies
http://news.yahoo.com/germany-eyes-swift-cuts-renewable-energy-subsidies-164549194.html

See also - https://www.physicsforums.com/showthread.php?t=607814

In the US, some wind producers use 'negative' pricing to push their power onto the grid. They receive subsidies from the US government, but it also costs the big utilities, who must reduce generation to accommodate the excess capacity.


Meanwhile, the German Supreme Administrative Court has ruled that the forced closure of RWE's Biblis nuclear power plant after the Fukushima accident was unlawful! This action may pave the way to restart the nuclear plants in Germany.

 

[fourier jr]

Meanwhile, the German Supreme Administrative Court has ruled that the forced closure of RWE's Biblis nuclear power plant after the Fukushima accident was unlawful! This action may pave the way to restart the nuclear plants in Germany.

It's actually paving the way to more coal plants in Germany. They're even potentially going to level old medieval towns to mine lignite, which apparently is the dirtiest form of coal. On the bright side though,

Lignite’s revival is concentrating attention on the drawbacks of the fossil fuel and may actually bolster support for renewables such as wind and solar power, according to Barry O’Flynn, a director in the environmental finance and clean technology team at Ernst & Young LLP.

“There will be increasing emissions restraints and controls in the years ahead,” O’Flynn said. “Lignite is not a threat to renewables. It could benefit them, since the emissions from lignite-fired plants will need to be offset” under EU pollution restrictions.

Also on the bright side, Deutsche Bank reported recently that something like 2/3 of the world could economically be powered by solar with today's technology & no subsidies at all:

Deutsche Bank also noted that PV was currently competitive without subsidies in at least 19 markets globally and expected more markets to reach grid parity in 2014 as balance-of-system prices continued to decline, despite cost-per-watt reductions slowing.

Coupled to improving conditions for the downstream market gaining access to low-cost finance and favourable policy conditions in key markets such as China and Japan, the PV market is therefore booming, the report concluded.

http://www.pv-tech.org/news/deutsche_bank_hails_second_solar_gold_rush

 

[mheslep]

Also on the bright side, Deutsche Bank reported recently that something like 2/3 of the world could economically be powered by solar with today's technology & no subsidies at all:

Where does Deutsche Bank claim this? There's nothing in that reference suggesting this.

 

[mheslep]

...
In the US, some wind producers use 'negative' pricing to push their power onto the grid. They receive subsidies from the US government, ...

The ~2 cent/kWh wind subsidy in the US was recently allowed to expire at the end of 2013, meaning new wind facilities coming online afterwards will not receive the benefit. Wind farms completed prior have at most a ten year window of continuing subsidy.
https://www.awea.org/Advocacy/Content.aspx?ItemNumber=797
http://www.forbes.com/sites/davelevitan/2013/01/02/wind-power-tax-credit-survives-fiscal-cliff-deal/

 

[fourier jr]

Where does Deutsche Bank claim this? There's nothing in that reference suggesting this.

I couldn't find the actual story online but this link has more details. They actually say 3/4 of the world, not 2/3:

In study released in late July 2013, DB’s US-based Vishal Shah estimates that three-quarters of the world’s solar market will be “sustainable” within 18 months, meaning they can operate with little or no subsidy. In 2 years, he reckons, the market will have flipped from one being largely “unsustainable” – needing big subsidies – to one being mostly sustainable. (graph below). Whether the market will indeed flip as Mr. Shah predicts or not, is debatable. Most likely, the flipping will happen gradually, with solar becoming cost-competitive with grid-generated power starting in high retail regions first.

http://tagteam.harvard.edu/hub_feeds/2160/feed_items/263564

Lux also says that solar will be cost-competitive with natural gas by 2025 in most of the world, also with no subsidies:
http://www.luxresearchinc.com/news-and-events/press-releases/211.html

 

[mheslep]

I couldn't find the actual story online but this link has more details. They actually say 3/4 of the world, not 2/3:

http://tagteam.harvard.edu/hub_feeds/2160/feed_items/263564

"... three-quarters of the world’s solar market will be “sustainable” " is an entirely different thing from providing a large fraction of global energy consumption from solar.

 

[edpell]

Alaska has 5000 gigatons of coal enough to run the US and China for 200 years. With Germany replacing nuclear with coal this may be the future.

 

[fourier jr]

"... three-quarters of the world’s solar market will be “sustainable” " is an entirely different thing from providing a large fraction of global energy consumption from solar.

I don't know how I misread that. Still, that's saying something.

 

[Office_Shredder]

I wonder how well that will stand up to growing Asian economies. Coal is economically competitive with solar even though the primary cost driver for coal is mining coal in the US, and the primary cost driver for solar is manufacturing panels in China. When Chinese wages go up is this going to cause problems for solar power?

 

[fourier jr]

When Chinese wages go up is this going to cause problems for solar power?

This doesn't quite answer that question but a study done by MIT & the National Renewable Energy Lab found that

low pay for Chinese solar panel workers isn't the reason that those solar panel prices have dropped to about a quarter the cost they were in 2004 or so. Instead, it's China's investment in manufacturing capacity and streamlining the supply chain that made those prices fall, suggesting that American solar manufacturers may well be able to compete even if they pay their workers a living wage.

The study, published in the journal Energy and Environmental Science, suggests that the large capacity of Chinese solar manufacturing plants compared to those in the U.S. gives Chinese manufacturers more leverage over materials suppliers. That helps keep materials prices lower for Chinese manufacturers. Clustering of solar factories in specific regions such as Anhui Province also provides cost savings.

Lack of regulations compared to the U.S. may also play a role: the study's authors cite speedy deployment of new manufacturing plants as another factor in China's cost-competitiveness.

All told, these infrastructural advantages worked out to close to a 23 percent cost advantage for Chinese factories.

http://www.kcet.org/news/rewire/solar/photovoltaic-pv/stuudy-solar-cell-price-drop-not-due-to-underpaid-labor.html

A CEO of an American manufacturer wants to do the same thing in Silicon Valley. Whether it actually works out in the end I guess time will tell:

The problem is that the current solar factories expanded so fast that their owners did not really scale operations. To see how margins can increase through economies of scale, we need only look as far as other semiconductor-related industries such as flat-panel displays and integrated circuits. (By the way, solar is a semiconductor-related industry. A solar cell is merely a diode, which is a semiconductor device.)

Each of these industries has scaled by increasing substrate size. Flat-panel displays enlarged substrate size by over 50X, and integrated circuits by over 20X. What has solar done? Would you believe less than 2X? If these other industries scaled the way solar has scaled, there would be no iPhone 5, or any iPhone at all.

The solution is simple: scale, don't replicate.

Don’t just build more small, unprofitable production lines, but scale them up from their current 25-megawatt to 30-megawatt level to a 250-megawatt to 300-megawatt size. This is possible, but it takes some innovation in factory, equipment and process design.

Fortunately, innovation is an American strength. In fact, the U.S. is home to most of the world’s leading semiconductor equipment manufacturers. Maybe the key to the gigawatt-scale solar factories of the future resides not in China, but right here in Silicon Valley.

The reason scaling works is that these high-speed production lines would have 10X the capacity, 10X the output, but only 2X to 3X the cost. This math has been proven over and over again in flat-panel display and semiconductor factories. Not only is factory cost reduced, making financing easier, but production costs come down as well. The gigawatt-scale factory of the future is both the solution to profitless prosperity and an opportunity to bring solar manufacturing back to the U.S.

http://www.greentechmedia.com/articles/read/Todays-Solar-Manufacturing-Paradox-Profitless-Prosperity

 

[mfb]

Alaska has 5000 gigatons of coal enough to run the US and China for 200 years. With Germany replacing nuclear with coal this may be the future.

A very hot future...
And stormy, but hey that could be good for wind energy .

Germany eyes swift cuts in renewable energy subsidies
http://news.yahoo.com/germany-eyes-swift-cuts-renewable-energy-subsidies-164549194.html

Not so surprising. Just as direct subsidies, Germany invests several billions per year in photovoltaics (2011: 8 billion €), and that number is still increasing. Even if Germany would suddenly cut all subsidies for additional photovoltaics, this would still give more than 100 billions additional subsidies within the next 20 years. With a more realistic development, this number could easily grow by a factor of two.
And that is just the money the owners of photovoltaic installations get directly. There are many more ways how money is put into that technology. Cheaper credits, priority at the energy market and so on.