(Worth reading article explaining how homeowners in rich countries might benefit from government subsidiaries for prohibitively expensive grid storeage, but third world countries cannot afford it).
The dirty little secret is that, at the scale relevant to most people, solar generation’s cost advantage is sort of beside the point. For solar to serve as the backbone of a grid, it needs to be backed with storage. That can come in the form of batteries, hydrogen, or pumped hydro. All of these are expensive; none of them scale. Storing a kilowatt-hour of electricity in a chemical battery costs an order of magnitude more than just generating it in a nuclear power plant. Which is why a 100% solar grid would be insanely expensive, even though generating solar power is basically free.
Unfortunately, that dirty little secret—a fundamental reality of the operation of the energy grid—is often left out of the energy conversation. The solar hype machine continues to tout the benefits of solar without much understanding of how solar fits into a more complicated picture.
If all the terminology gets a bit confusing, this little fable might help.
Imagine you wake up tomorrow to news that scientists have invented a machine that renders hamburgers both environmentally benign and pretty much free. Environmentalists are delighted! There’s just one catch—the machine makes those burgers at random times, and if you don’t eat them the moment they’re made, they go bad.
Your kid, who is very concerned about the environment, hectors you into buying one of these machines. It whirs into action at 8:47 a.m. and makes three burgers, only you’re doing your school run just at that time. “Bad luck!” you think, as you throw out the spoiled burgers. The machine next springs to life at 2:09 p.m., at which time you wolf down the two burgers it makes only for the darn thing to crank up again at 4:12 p.m. when you’re at the gym. Once, it made nothing for a whole weekend.
You start realizing that however free those burgers may be, you’re still going to have to rely on the grocery store down the street for a fair bit of your food. Along comes an environmentalist politician who decrees that, since these near-free-burgers are so eco-friendly, the neighborhood grocery store will be required to buy any unwanted burgers from you at a fixed price. This is the Burger Feed-in-Tariff, and I’m sure you can imagine how popular that rule is going to be with the grocery store.
With the new rules, the grocery store is forced to buy the burgers your machine makes, even at times when nobody wants any burgers. The grocery store has no good options for what to do with these unwanted burgers. It can either buy the exotic, high-tech $3 million refrigerator it takes to store them, or else it ends up paying people to take burgers off its hands.
At this, your enviro-kid rejoices: negative burger pricing! The future is here!
But the system means mayhem for the grocery store’s whole business model. What used to be a stable clientele buying a predictable amount of food has turned into a crap-shoot. A system set up to buy food from wholesalers and distribute it to consumers now has to build a whole complicated new infrastructure to buy food from consumers as well: a complicated new “smart grocery store” infrastructure to handle the reverse flow. That’s expensive!
Worse, when one customer’s machine starts off-loading burgers nobody wants, every customer’s machine starts off-loading burgers nobody wants. The high-tech fridges it takes to store them are insanely expensive and their capacity is limited. At times it gets so bad, the grocery store has to implement burger curtailment: paying customers to unplug their burger machines so they won’t start flooding the store with unsellable, unstorable hamburgers.
The grocery store’s operations are now in constant turmoil. In time, they’re forced to raise prices for their regular groceries to cover the additional costs associated with distributing “free” burgers.
At which point your kid rolls his eyes at you and wonders how you can be so foolish as to pay higher and higher prices for that gnarly food from that rickety old grocery store when the burgers the machine makes are free. Green activists will scoff at outdated old polluting supermarkets that, absurdly, insist on raising prices in an age of free burgers!
posted by f.sheikh