Understanding Renewables

To understand some fundamental aspects of renewables, let's study Germany since this is the country that by far has the most installed solar PV (photovoltaic) capacity in the world.

The German solar PV installed capacity at the end of 2011 was close to 25 GW (gigawatt).  However, the actual amount of electricity produced that year with solar PV panels was only 18 TWh (terawatt hour).  This is, on average, only 8.2% of the installed capacity.  In other words, the 25 GW of installed capacity produced on AVERAGE only 2.05 GW.  Now, this is a big difference!

Why the discrepancy?  

Because, off the bat, 50% of the year is night.  And then we have clouds, haze, and the sun striking the panels from behind (particularly in Summer).  So, overall, the capacity factor of German solar installations is consistently below 10%. 

Suddenly the numbers seem much less attractive.

But even these much reduced numbers don't reflect the real, and more complex situation going on.  If a cloudless day occurs in most of Germany, the total production of the solar panels at noon will approach the above mentioned 25 GW.  Consequently other (conventional) power plants would have to reduce their output or even be completely idled.  However, later in the day they will need to be back in the energy generation business. 

Who pays for the revenue losses of these conventional generating plants?  Good question.

At night, the PV production obviously drops to zero, but even during the day overcast skies can easily reduce the output by 90% or more.  Also, in winter the nights are much longer.

What we are trying to say with the above is that practically all the solar PV installed capacity has to be backed up with conventional power plants, in other words, renewables are not reliable.  Renewables for the most part do not replace conventional generating plants, they are only redundant fluctuating producers.

And here we come to one of the most thorny issues: subsidies for renewables.  Why are subsidies necessary?

1. Because renewables are MUCH more expensive than conventional energy.  Let's continue with the solar PV example.  When we read that the "cost per peak watt" in Germany has dropped to only EUR1.78 it means (once we factor in the capacity factor) that the actual cost of the average watt is almost EUR18.  This is an outrageous cost when you compare it with less than EUR2 investment for a fossil fuel plant and less than EUR5 for a nuclear one. 

2. Renewables are redundant power that is not really needed, so there is no real incentive (aside from the subsidies, that is) to build them. 

Below is the actual production of a PV installation at Fort Collins, Colorado for the past few days.  The output almost looks like an ECG during the day and at night there is (obviously) nothing.

That is all for today.  Thank you.