Saturday, February 20, 2010

Wind Energy - An Alternative to Getting Nuked

This is a recent diary in Daily Kos - the full discussion can be read here - http://www.dailykos.com/story/2010/2/19/838739/-Wind-EnergyAn-Alternative-to-Getting-Nuked. Otherwise, here goes.

There is a newly released blurb on the American Wind Energy Association (AWEA) website (see http://www.awea.org/newsroom/releases/02-18-10_US_Wind_Resource_Larger.html) that is definitely worth a look, a mirror of one from the US Dept of Energy:

http://www.windpoweringamerica.gov/filter_detail.asp?itemid=2542


This is about a serious update of the wind energy potential that was last estimated in the 1979-1981 era (see http://rredc.nrel.gov/wind/pubs/atlas/), and which was woefully out of date. This new one used wind speeds present at 80 meter heights (most commercial scale units installed in the US are have been on 80 meter tall towers for several years). This is still a pretty conservative estimate, and the details are a bit sketchy.



The newly calculated amount of electricity that could be readily tapped from the winds across just the land portion of this country is... HUMONGOUS.

The estimate is that 37 million gigawatt-hrs/yr (an average of 4220 gigawatts (GW) of continuously produced power) could be made with wind turbines putting out an average of at least 30% of their rated gross capacity (i.e. no shutdowns for maintenance and inspections). Since the average net output (the electricity put on the grid and which turbine owners get paid for) is about 94% of the gross output, that's still close to 4 Terawatts (TW) of average output. It would take about 10.5 million GW of wind turbine capacity, or about 4.2 million x 2.5 MW wind turbines to supply this rather large quantity of power/energy.


And there is only one problem - the US only used an average of 425 GW in 2009. So, using the net output basis, we have 9.3 times too much wind capacity. And even if we replace all the natural gas heating with renewable electricity, that would only boost the demand to around 750 GW. We have too darn much wind capacity - what are we to do with all this useless potential, eh?


Maybe we could get Goldman Sachs to write up some CDS's on all this unusable potential....just kidding.


There is another small point about this study - just what constitutes a wind speed needed to get a 30% gross energy output? For that, we will have to wait for the full report to come out, which will hopefully be in the near future. As expected, the midwest really shines (for example, Texas could more than power up the country, and Nebraska could almost do it). Of course, there is also the matter of getting the electricity from where it is made to where it will be used by actual human beings and in the factories, offices and homes they use. Or maybe it's time to start transplanting people to where the energy is (but then there is the water problem....). So maybe it's easier to keep most people where they are.


This study does not touch upon offshore (Great Lakes, Atlantic and Gulf, or the deepwater potential of the very windy west coast (it's shallow on the Atlantic side, not on the Pacific side)). And it excludes a lot of potential in more populated areas, or in the southeast, because of the requirement in this study for the 30% gross output.


Here is why that is important. Different wind turbines tend to be targeted to different wind regimes. A turbine designed for fast winds (like Altamont Pass wind canyons) will not work so well in more moderate wind regimes. And one designed for more moderate winds like those in NY State (onshore anyway) will get torn to shreds in the windy zones - the blades are too big for the generator, and the unit would self-stop for a considerable part of the year. Anyway, here are some examples of wind speeds at hub heights that will give a 30% gross output at close to standard conditions (15 C air temperature, sea level).


Wind Turbine ........................... Wind Speed needed for 30% Gross Output


Vestas V-100 x 1.8 MW ........... 5.8 m/s

Vestas V-90 x 1.8 MW ............. 6.1 m/s

Vestas V82 x 1.65 MW ............. 6.3 m/s

Vestas V-90 x 3 MW ................. 8 m/s

GE 1.5s 1.5 MW x 70 m rotor .... 6.8 m/s

GE 1.5sl 1.5 MW x 77 m rotor ... 6.5 m/s


The Vestas numbers (V-90) correspond to the rotor diameter. And since the power in the wind is proportional to the cube of the wind speed.... well, the V-100 x 1.8 MW unit tapping 5.8 m/s wind is getting a 30% gross out from winds with about 71% of the power of those needed by the GE 1.5sl (now the most widely used wind turbine in the US). Those same 5.8 m/s winds have less than 39% of the power that are needed for the Vestas V90 x 3 MW unit (they do best in 9 m/s average wind speed zones...).


So, by using turbines designed for more mellow wind resource areas, a lot more land gets opened up. Another trick is to use a taller tower - as is often done in Europe. Winds at 100 meters above the ground could easily be more than 5 to 10% faster than those at 80 meters above the ground. Tower heights in Europe are often 113 meters (the tallest is 160 meters). And really big turbines, like the Enercon E-126 x 7.5 MW unit need tall towers (138 meters) just to keep the blades in windy zones (the E-126 would reach up to 201 meters above the ground).


Anyway, this is great timing. President Obama has just decided to pursue the "nuclear option" - no, not to get rid of the filibuster in the Senate and pass some modest Health Care proposal, but to pay back a big campaign contributor - Exelon (formerly Illionis's biggest utility, Commonwealth Edison, now sort of spun off as a nationwide electricity generator - see http://en.wikipedia.org/wiki/Exelon). Those new nukes proposed for Georgia would, if they ever do get built, deliver electricity at more than 20 c/kw-hr - and with no mandate for high level trash disposal or catastrophic insurance (that one is probably worth $500 million/yr per reactor, assuming it was even possible). Oh well, now that the Yucky Mountain trash disposal site is no longer an option, I hope the folks in Georgia understand that the disposal site for that trash is going to be located...at the site where those reactors get installed (in adjacent "swimming pools). Won't THAT do wonders for property values...


Maybe the President can make a better PR announcement for this stinker of a project in Georgia on April 26... assuming he has a shred of courage. Hint, April 26 is one of those anniversaries that a lot of people would really like to forget about... especially the nuke crowd). See http://en.wikipedia.org/wiki/Chernobyl_disaster.


Also cross-posted on http://www.dkgreenroots.com

DB


Tuesday, February 16, 2010

Wind Energy Review for 2009

Summary
Despite the onslaught of "The Great Recession" that started up in full in the last quarter of 2008 (bankruptcy of Lehman Brothers, General Motors, Chrysler, Merrill Lynch, etc) which became a world wide contagion, much of the renewable energy industry did OK for itself in 2009. In particular, the wind turbine industry truly became a world wide industry, with 3 major centers of growth - North America (US centered), Asia (China centered) and Europe (many major nations with steady growth). In addition, the offshore wind turbine industry began to "take off" in Europe in a significant manner; growth should be near 100% for several years for a variety of reasons. In addition, several other countries adopted a Feed-In Tariff, and a few more seem ready to take he plunge - especially the UK. Total world capacity was almost 158 GW at the end of 2009 with an average output of almost 45 GW. At this rate, by the end of 2015, world capacity will be near 450 GW (doubling every 3 years), with an electrical output equivalent to 150 x 1100 MW nuclear reactors.

The PV industry also sold a lot of product, though a market upset in Spain caused a significant variation in sales throughout the year. In the U.S., the ethanol industry performed steadily and profitably, after the wild ride of the 2007-2008 era. The bio diesel industry did not do well in the U.S. after the European Union slapped import duties on subsidized US product. Meanwhile, steady growth occurred in both biomass combustion (often wood to energy) and geothermal sectors. Finally, a corn cob to ammonia facility, and waste wood to ethanol (syn-fuels route) were close to completion by the end of 2009.

In NY state, 2009 was for the most part a dreadful year, renewable energy speaking. The weakness in the NYISO system, coupled with a collapse in electricity demand led to lower prices, which effectively shut down the wind turbine installation industry in the state. In addition, no significant NY wind turbine related manufacturing operations were started up. The only glimmers of progress was the takeover of the Fulton ethanol facility by Sunoco, followed by the successful operation by the end of the year, as well as the start-up of the Globe manufacturing silicon plant in Niagara Falls (98% Si). In early 2010, high purity Si will be in production, for which there should be a significant market in Ontario.

Discussion
Wind: Last year, new records for worldwide and US installation rates were set. New installations were 37.466 GW (about $60 billion was spent on this) versus only 26.3 GW installed in 2009. At this pace (22% CAGR for he last decade) the installation rate will be 113 GW/yr worldwide, and the installed capacity will be close to 475 GW by 2015. See http://www.gwec.net for details

China doubled its production and installation (essentially no imported turbines are allowed entry into China any more, and only a small percentage of its turbines are made by non-Chinese firms, a direct result of deliberate government policy) from ~ 6 GW to 13 GW. Total installed capacity is now 25.8 GW. By next year, the installation rate should be near 25 GW, and more wind turbine capacity probably will exist in China than in any other country. Unfortunately, the installation of coal and gas fired power plants has also been kept up at a significant rate - so much so that China will now have to import successively larger amounts of coal. In effect, China has achieved "Peak Coal" within the country, due to the inefficient and dangerous coal mining system. Other significant coal uses are for steel, chemical as especially ammonia and major by-product urea. China is self-sufficient in wheat and rice only due to massive over nitrogen fertilization - also deliberate government policy. Also unfortunate is reports of the poor quality of the wind turbine units; production and installation of turbines (which requires labor and capital) seems to be more important than is the electricity that is supposed to be obtained from them. Maybe this is the down side of the meld between communism, capitalism, fascism, corporatism, corruption and the world's oldest bureaucracy - all of which make for the bizarre mix that is China in 2010.

In the U.S., 9.9 GW of turbines were installed - mostly in Texas - see the AWEA map at http://www.awea.org/projects. The higher than expected installation rate was still not sufficient to fully utilize the large production capacity installed in the last 2 years - several facilities had to slow down, especially in the early part of 2009. The new stimulus measures pushed by the Obama administration (the use of the ITC and or equivalent 30% grant instead of tax credits versus the PTC) were an important factors in this recovery. The US now has over 35 GW installed, which should produce an average of nearly 12 GW on a continuous basis. Due to the "Great Recession" - George Bu$h 2's parting gift to America - electricity demand fell in 2009 versus 2008 by about 5% in the US. Much of the lower electricity usage (~ 25 GW) was the result of less coal and natural gas combustion to make electricity. Partly as a result of this, US CO2 pollution fell in 2009 versus 2008 by about 500 megatons (less electricity made, less gas burned in shuttered industrial facilities, less driving of cars and trucks).

In Canada, Ontario and Quebec were where most wind development occurred (950 MW). Thanks to the Green Energy Act in Ontario (a Feed-In Law), wind development is likely to significantly escalate (double each year for several years) in 2010. In addition, over $84 billion (21 GW) in proposed offshore wind farm applications (100 of them) for the Great Lakes were submitted to the Ontario government in less than 1 month. With this rate of wind turbine installation, the closure of those dreadful coal burning power plants like Nanticoke could start happening by 2011.

In Mexico, developments across huge wind canyon/plateau in Oaxaca started - this will result in several GW of very fast wind speed turbines being installed - winds average 9 m/s in many locations in this state. See http://www.bergey.com/Maps/Mexico.Wind.htm and especially http://www.nrel.gov/wind/international_wind_resources.html#mexico. Oaxaca is in extreme southern Mexico; its wind resource is estimated to be near 44 GW delivered; this is really windy area, caused by the air pressure difference between the Gulf of Mexico and the Pacific Ocean

In Europe, about 10.5 GW of new turbines were installed - including over 500 GW of offshore installations. There is now over 76 GW of wind capacity in place - Spain and Germany have almost 60% of this capacity, but development is occurring at an increasing pace in several countries - notably the UK, France, Italy, Sweden, Portugal, Greece, Ireland, Poland and Turkey. The offshore development in the North Sea is about to achieve significant growth, as much of the infrastructure for this to occur is now in place. The manufacture and installation of 5+ MW units is now occurring in commercial mode. There are 4 makers of 5 MW or more sized units - REPower, Areva/Multibrid, Bard and Enercon; Enercon's is now rated at 7.5 MW, and they are targeting land based units using concrete towers and 62 meter long blades that are shipped in two parts.

As expected, installed costs stayed fairly constant; the price pressure cased by rising steel, copper and oil (epoxy resin is about 75 wt% of most blades, and that's mostly oil derived) eased somewhat. Several companies introduced moderate wind speed turbines (longer blades and possibly taller towers for a given generator size) in the US - notably GE, Vestas, Siemens, Nordex, Fuhrlaender and REPower. GE even introduced a replacement to it's huge moneymaker (1.5 MW) models - a 2.5 MW unit. There is a $1 billion project in Oregon where ~ 250 of these will be installed in 2010-2011. Most wind turbine companies managed to weather the financial storm of 2009 through being careful not to overextend themselves. If the world economy recovers a bit in 2010, they should be in for a good financial year. Many large manufacturing facilities were built in the U.S. in 2009 (notably Vestas, Nordex, Siemens) and Canada (REPower, Enercon), which should be producing products in 2010. All that is needed is customers....

As for NY State, the AWEA site lists several projects as coming on line in 2009, but they were all constructed in 2008 and one in 2007. None were started in 2009. This is mostly due to the collapse in electricity prices throughout the state that resulted when demand dropped by about 5%. Since electricity is a very inelastic commodity, a slight change in demand usually results in a large change in price. And due to the NYISO system, when demand drops slightly, prices collapse even faster due to the Merit Order Effect (the pricier electricity is removed, and prices can drop by 75% for a small drop in demand). Despite the presence of the RPS incentive in NYS (1.5 c/kw-hr for the 2009 projects, ~ 2 c/kw-hr for two proposed 2010 projects), less than 50% of the meager renewable energy targets established by the RPS program are likely to be met - a result of tying wind derived electricity prices to fossil fuel/depreciated/subsidized nuke derived electricity. Perhaps a different plan will be forthcoming which overcomes the unforeseen dis-econommies of NY's electricity market for renewable energy.

Solar - Worldwide PV capacity installed was about 8 GW in 2009 - worth about $50 billion and about 1 GW in terms of delivered electricity, making PV about 10 times more expensive than wind. No significant breakthroughs were introduced, though the superiority of the Feed-In Law system as a way to promote job creation/PV installations was quite apparent. MAny new manufacturing facilities were opened in 2008-2009 - especially in Germany and China (which is attempting to be the dominant world PV manufacturer, and the same goes for wind).

Biofuels - In the U.S., the ethanol industry continued its steady process, after the wild roller coaster of 2008. In that years, oil, corn, steel, fertilizer and natural gas prices all peaked, as did availability of credit; these collapsed by the end of 2008. Verasun, a major EtOH player, went bankrupt due to corn futures gambling (they got spanked bad); it was evidently bought out/plants were sold to Valero, a major petroleum refiner. During 2009, corn prices remained steady despite record yields (162.5 bushels/acre) and a huge crop, while natural gas and ammonia prices remained collapsed and while petroleum prices rebounded from $35/bbl to near $75/bbl. As a result, a record production of EtOH was achieved without the industry going bankrupt. By the end of 2009, production was averaging 765, 000 bbls/day. A 10% increase in capacity is anticipated for 2010.

The Future: For 2010, the worldwide and also regional economies are expected to recover, somewhat. China is expected to double its output, and it will become the country with the largest installed capacity and fastest installation rate of wind turbines in the 2010-2011 time period. At some point, it will also begin to flood the world with Chinese made wind turbines (all based on European technology), using Chinese financing (some of that Walmart money, put to a use).

In the U.S., the wind turbine marke will limpa along, still hampered by the bizarre financing schemes needed to install wind farms using tax credit/tax deduction based financing. Since electric monopolies are one of the few industries that have a reasonably assured profitability, they may well become dominant financiers and project owners in the industry. Continued major foreign ownership of wind farms and financing of wind farms is also quite likely (mostly European based, like Iberdola, EDP (Horizon), EDF, RES, etc.

A wild card in these efforts will be the demand for oil and also the price of oil (now extremely closely intertwined). World oil production has evidently reached an upper limit, mostly based on the ability to BUY the oil (Peak Credit). If worldwide economic activity picks up, oil prices might rise to the point where another recession is induced by late 2010 or early 2011. This would put the ability to finance wind farm developments in some doubt - especially in the U.S.

In Ontario, the "gold rush" for renewables will most likely continue, a direct result of their Green Energy Act. The contrast with NY State (and Ohio and Michigan) will become very stark, but the ability to get a Feed-In Law for any of these state is still questionable. The only difference between north coast and the south coast of the Great lakes will be in financing of projects. The stable prices made possible by the Green Energy Act will allow large scale developments (of varying sizes), while the unpredictable electricity pricing in the U.S. will effectively severely limit any new wind turbine installations (and render any PV installations moot, or else extremely subsidized by taxpayers).

Oh well, these are interesting times.....

DB

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