The Real Cost of Alternative Energy Generation

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The Real Cost of Alternative Energy Generation PQSynergy TM Conference 2014 Chiang Mai, Thailand

hy Are We Talking About Alternative Energies? an nature to talk about better ways to satisfy human needs and wants. tically correct/popular thing to do need to expand our knowledge base to solve energy problems ironmental costs of old technology energies are unacceptable rgy is a major cost factor in everything we do g alternative energy sources creates new problems for PQ guys to solve

The Evil Trio -- Coal, oil, Nuclear Political Correctness is low and falling Environmental impacts unacceptable Air smog and carbon from coal and oil Waste disposal of spent fuels for Coal and Nuclear costly Power plant safety a major concern Old technology is cost competitive baseline Trio provides over 90% of world s electricity

Billons KWH World Wide Electricity Status 2008 2009 2010 2011 Generation 1,9161.1 19,062.3 20,253.9 21,020.9 Consumption 17,410.0 17,316.8 18,501.4 19,298.5 Renewables 3,731.9 3,871.4 4,177.1 4,402.4 % Renewable 19.5 20.3 20.6 20.9

Electricity Costs by Country Country Industrial Household Ratio H/I Denmark 104.15 383.43 3.68 Mexico 114.74 90.20 0.79 Italy 291.79 288.40 0.99 Norway 57.56 135.98 2.36 Japan 194.27 276.76 1.42 Germany 148.71 338.75 2.28 USA 66.98 118.83 1.77 US $/MWH

Fossil Fuel Subsidies Subsidies Government keeps fuel/electricity prices below market / cost to produce 2012 estimates $51 billion - 68% oil, 24% electricity Rising import costs make current levels unsustainable Smuggling a Major Problem - Increases cost to the government - Reduce tax revenue Distort Market and Generation Facility US example - Wind farms 2.1 cent/kwh subsidy - Utilities must buy excess electricity in period of lower demand

Alternative Energy Sources Solar Photo voltaic cells, direct/concentrated heat Wind power Bio-mass Water power falling, tidal currents, waves Fuel cells Hybrid systems - gas/thermal Geo Thermal

Traditional Costing Cost to customers per KWH Levelized Cost Factors - Fuel, Generating Equipment - Depreciation, Transmission Cost, Maintenance Profit Subject to Government Regulation / Interference Assume a steady state operational environment Common Basis for Business Decisions

Cost Factors Capital Cost - Fossil Fuels low - Wind turbines/solar PV high - Solar thermal, wave & Title, Waste very high Fuel Costs - Fossil fuels, Biomass high - Nuclear low -Renewable ZERO Other Cost Factors - Wastes, Disposal nuclear and coal - Insurance - Parasitic loads of plant operation - Research and development new technologies - Satisfying government Regulations - Government incentives, tax credits, etc

Comparative Cost (New Plants) Coal 96-116 $/MWH (combined cycle) Gas 66-128 $/MWH (Turbines) Geo Thermal 48 $/MWH Bio Mass 103$/MWH Wind 80-204 $/MWH (offshore) Solar PV 130$/MWH Hydro 85 $/MWH

Energy Intensity by Countries Unit of Measure MTOE / GDP ($1k) - Indonesia 2.3 - Thailand 1.8 - Malaysia 1.7 - Philippines 1.1 Subsidies lower intensity - GDP Impact Increases project payback times - Distort market place prices Energy Demand / Capital.9 MTOE (ASEAN)

Solar Power Usage Factors Availability Limited to daylight hours and mostly clear sky Energy collection Photo voltaic cells large mount footprint for major users Direct for heat, may be easily concentrated for hybrid systems Favorable operations and maintenance costs Political Correctness high and improving. Good source of jobs and low environmental impacts Increases need for distribution infrastructure

Solar Cell Installation Crystalline- Old Technology Poly Crystalline-12V- $1.50-$2.00 per w Mono Crystalline - 12V- $1.30 per watt Large System 3-6,000 w about $1 per watt

Wind Power Usage Factors Availability 24/7 at natures whim Energy Collection complex electrical generators in remo locations Wild life impacts Some direct usage for pumping water Climate impacts in some places Political correctness quite high. Great source of jobs for manufacturing and installation Distribution infrastructure a problem in some areas Visual pollution concerns near urban areas Typical Installation

Offshore Wind Energy Abundant Availability 70% US Electricity -28 coastal Shallow water has a big potential 43% of Atlantic 100 Deep Easier to transport large components Larger Generators Use Floating Generator in Deep Water Under sea cable carry electricity to shore for distribution Offshore winds are stronger during the day when energy is needed

Storage of Electricity Grid operational Systems provide reserves Spinning Synchronized reserved rapid response Other reserves 10 responses Pumped storage water, compressed Air and Fly Wheels Required to supplement solar, wind and water User level demands for emergency and non-emergency - Gas Power Generation, Battery packs - Rechargeable personal electronics - Fuel cells Economics drive amount of storage available DOE 2013 electrical storage handbook is online

Grid Integration Costs Infrastructure Additions - Transmission Lines - Current merging hardware Administrational costs - Internal - Governmental Power Quality Issues Economics who pays the bill Renewable replace traditional

Electricity Access 2011 Humanitarian / Political problem in some ASEAN countries 134 million people or 22% have no access Philippines 30%, Myanmar 51%, Cambodia 66%, Indonesia 27% and Lao PDR 22% Distribution infrastructure is major cost consideration