Thursday, August 17, 2017

A Subsidy Synopsis

Subtitle: Wind Energy Succeeds while Nuclear Recedes

Much is made over the subsidies that renewable energy have, almost always by their detractors.   One would think, from listening only to the detractors, that no other energy source (electricity generation in this instance) has ever had, or ever will have, subsidies.  

The facts are quite the opposite.   But, before getting into the actual numbers for each generating technology, a digression into subsidy policies.   Also, what to include when the word subsidy is used. 

Governments are the usual source of subsidies, sometimes in the form of direct grants of money from tax revenues, or in favorable tax treatment (e.g. tax credits) to companies that engage in an activity, or regulations that favor that activity, or government services to that activity, or market activity i.e. the government purchases the product to ensure a market exists, also government guaranteed loans to build a project to produce the product.   In the case of commercial nuclear power, an additional (perhaps unique) subsidy was granted: no liability to the nuclear plant owner in a catastrophic radiation release, beyond a small, nominal amount that is covered by insurance.  The government assumes all liability above a stated amount.  SLB has at least two articles on the Price-Anderson Act for liability subsidies for commercial nuclear power plants. 

Many, many activities are within the world of subsidies.   Indeed, the US Federal Tax Code lists 21 items as tax credits for individuals, plus 31 additional items as tax deductions for individuals.  The list for businesses is much, much longer.   In addition to Federal tax credits and tax deductions, many states also have additional tax credits and tax deductions.  

Having looked at what subsidies are, next is discussed why they exist.   Government has as a rightful concern the well-being of the people.   There may be government policies that are to be adopted, but the government prefers that private enterprise conduct that activity.   One example of this is commercial nuclear power.   Before power plants were built, there were plenty of atomic bomb blasts, later nuclear blasts and hydrogen bomb tests.   In short, those tests created great fear not only in the US population, but in many millions of people around the world.   US President Eisenhower recognized this, and made his famous Atoms For Peace speech at the UN.   In that speech, he advocated peaceful uses for the atom, including producing electricity in atomic power plants.   The thinking was that maybe, people would be less frightened if they know of the benefits of atomic power.   He also listed medical uses and agricultural uses.   As a result, Eisenhower insisted the US utility industry build nuclear power plants.  The executives were reluctant, knowing already that the cost to build such things was far greater than building a same-size coal-powered plant.   They also refused to build any at all due to the huge liability and insurance costs from a radiation release.   Eisenhower listened.  And had Congress pass the Price-Anderson Act, to take on almost all the radiation release liability.    So, that is one subsidy and its reason. 

Others, such as the tax deduction for home mortgages but not for home rental payments, are to encourage an activity that promotes domestic stability.   The thinking is that a home owner takes greater pride in his home and is ultimately more stable than those who rent.  There are arguments about that. 

Yet another is the direct use of government funds to build large dams across major rivers, store up the water in lakes and generate hydroelectric power as the water is released.  Almost all of the large hydroelectric dams in the US were built with government money.  Indeed, three of the biggest systems are the TVA, BPA, and of course the world-famous Hoover Dam.   TVA is Tennessee Valley Authority, BPA is the Bonneville Power Authority.   The power produced from all was sold at very low prices for many decades.  

Next, the question is, what is not a subsidy?  Are there benefits that accrue to a technology that are not actually subsidies?  That question generates considerable debate.   One that is frequently thrown out is that fossil fuels do not pay for their external costs to society, which is claimed as a hidden subsidy.   Another is that mining of oil, coal, and natural gas enjoys a mineral depletion allowance in the tax treatment of a company's revenues.   Still others are the pollution to air, water, and soil from fossil fuels that create harm or monetary losses but are not paid for by the fossil fuel companies.   Lately, the molecule Carbon Dioxide has been vilified as a convict (no longer a suspect!) in that category of pollution.   The buzz-word today is "social cost of carbon."  

Examples include the mine tailings for coal, toxic metals in ash piles from coal, drilling mud from oil and natural gas, sulfur and nitrogen oxides from burning coal and oil and gas, particulate matter (PM) from fossil fuel combustion, and dirty water disposal from hydraulic fracturing operations.   In addition, there are toxic salts from geothermal wells that produce power.   Even more toxic are the radioactive solids left behind in the mining of uranium ores and its enrichment.    Then, there are the impacts on wildlife.  There were acid rain stories and scares a few decades ago that affected fish and the creatures that ate them.   There are the millions of birds that are killed each year by conventional power plants.  

Yet, with all that as known pollution, the anti-wind groups focus solely on the bird and bat deaths by old-style derrick-design wind turbine support towers. 

The Past 60 Years Of Energy Subsidies

A few years ago, in 2011, the federal government did a study on subsidies for energy.  The result was "60 Years of Energy Incentives; Analysis of Federal Expenditures for Energy 
Development," October 2011, By Management Information Services, Inc., Washington, D.C.
Prepared for The Nuclear Energy Institute, Washington, D.C.   see link to report.   For those who prefer to cut and paste, the URL is 

http://www.misi-net.com/publications/NEI-1011.pdf

The report results are summarized in Figure 1 below.
Figure 1 - Comparison of Energy Subsidies since 1950 by Type and Energy Source
(2) Renewables are mostly Wind and Solar 
UPDATE:  8/18/2017 - added the various elements for each category of subsidies in the Report.  Added a number of Federal subsidy programs. 

A. Tax Policy
Tax policy includes special exemptions, allowances, deductions, credits, etc., related to the federal tax code. Tax policy has been, by far, the most widely used form of incentive mechanism, accounting for $394 billion (47 percent) of all federal expenditures since 1950. The oil and gas industries,for example, receive percentage depletion and intangible drilling provisions as an incentive for exploration and development. Federal tax credits and deductions also have been utilized to encourage the use of renewable energy.

B. Regulation
This category encompasses federal mandates and government‐funded oversight of, or controls on,businesses employing a specified energy type. Federal regulations are an incentive in the sense that they can contribute to public confidence in, and acceptance of, facilities and devices employing a new or potentially hazardous technology. Federal regulations or mandates also can directly influence the price paid for a particular type of energy. Thus, it is not surprising that federal mandates and regulations have been an important part of energy policy, accounting for $158 billion(19 percent) of energy incentives.
For this analysis, two types of federal expenditures associated with regulation were identified: 1) gains realized by energy businesses when they are exempt from federal requirements that raise costs or limit prices, and 2) costs of federal regulation that are borne by the general budget and charged to the regulated industries.

An example of the first type of regulatory incentive comes from the oil industry, which has benefited
from:

 exemption from price controls (during their existence) of oil produced from “stripper wells”
 the two‐tier price control system, which was enacted as an incentive for the production of “new”oil, and
 the higher‐than‐average rate of return allowed on oil pipelines.\
An example of the second type of regulatory incentive comes from the nuclear energy industry.Through the NRC (and its predecessor, the U.S. Atomic Energy Commission), the federal government regulates the design and operation of nuclear plants to ensure protection of public health and safety. In this case, an independent, credible federal regulatory regime promotes public and investor confidence in commercial nuclear enterprises around the country. The cost of regulating nuclear safety through the NRC/AEC through 2010 was more than $16 billion. This amount includes the cost of administering both agencies (AEC to 1975 and the NRC from 1975 forward) as well as credit for regulatory user fees paid by electric utilities. Since 1991, these user fees have offset most of the NRC’s operating budget.

C. Research and Development
This type of incentive includes federal funding for research, development and demonstration programs.Of the $837 billion in total federal spending on energy since 1950, research and development funding comprised about 18 percent ($153 billion).

D. Market Activity
This incentive includes direct federal government involvement in the marketplace. Through 2010,federal market activity totaled $80 billion (10 percent of all energy incentives). Most of this market activity was to the benefit of hydroelectric power and, to a much smaller extent, the oil industry.Market intervention incentives for hydroelectric energy include the prorated costs of federal construction and operation of dams and transmission facilities. These costs are prorated because beginning in the 1930s, federal dams and water resource projects have been multi‐purpose. The results of these investments include flood control, navigation, recreation, regional development and other benefits in addition to hydroelectric power. Therefore, it is necessary to estimate the portion of the net investment in construction and operation of dams allocated to power developmentand the relevant transmission facilities.
Market activity incentives for the oil industry include the relevant planning, leasing, resource management and related activities of the U.S. Department of the Interior’s (DOI) Bureau of Land Management (BLM).

E. Government Services
This category refers to all services traditionally and historically provided by the federal government without direct charge and totaled $57 billion through 2010, representing 7 percent of total incentives. Relevant examples include the oil industry and the coal industry.
U.S. government policy is to provide ports and inland waterways as free public highways. In ports that handle relatively large ships, the needs of oil tankers represent the primary reason for deepening channels. They are usually the deepest draft vessels that use the port and a larger than‐proportional amount of total dredging costs are allocable to them. The authors estimated the expenditures for federal navigation programs and allocated these costs as a petroleum subsidy according to the ratio of petroleum and petroleum‐based products carried to all water borne trade. Similarly, to estimate the incentives for coal production from federal expenditures for ports and waterways, the costs for all improvements were multiplied by coal's share of the tons of total waterborne commerce.

F. Disbursements
This category involves direct financial subsidies such as grants. Since 1950, direct federal grants and subsidies have played a very small role in energy policy, accounting for –$6 billion, a negligible fraction of total incentives.

An example of federal disbursements is subsidies for the construction and operating costs of oil tankers. For nuclear energy, federal disbursements are negative, meaning the industry pays more than it receives in disbursements as a result of the contributions the industry makes to the Nuclear Waste Fund. As of 2010, the Nuclear Waste Fund had accumulated an $18 billion surplus. The entry shown in Exhibits 1 and 2 for disbursements to nuclear energy is shown as a negative value to reflect the industry’s over payment compared to what has been disbursed on its behalf.   End Update.

Some discussion follows.

It can be seen from Figure 1 that subsidies exist for all in healthy amounts, except for geothermal.  The number for nuclear incentives is mostly for research programs such as the fast breeder program.  Notably absent for nuclear are the subsidies as described earlier, radiation release liability, loan guarantees, and others.

One of the main arguments for incentives, or subsidies, is the research or assistance actually produces results that are useful.   It is clear that most of the nuclear R&D has not produced useful results.   In direct contrast, the funds spent on wind turbine energy have been extremely effective.  Wind turbine generators have one-third the capital cost today compared to only 7 years ago, plus much better productivity or capacity factor.   Also, wind energy now comprises almost 8 percent of of total US electricity production.   That percentage will increase as more wind turbine generators are installed.  

Wind energy incentives, or subsidies, have been a rousing success.   Nuclear research dollars, not so much.   In fact, fusion is still 100 years away, breeder reactors are also, and molten salt reactors are a disaster waiting to be built. 


Roger E. Sowell, Esq.
Marina del Rey, California
copyright (c) 2017 by Roger Sowell - all rights reserved


Topics and general links:

Nuclear Power Plants.......here
Climate Change................here  and here
Fresh Water......................here
Engineering......................here  and here
Free Speech.................... here
Renewable Energy...........here  


  

Monday, August 7, 2017

A Brief History of Wind Energy - USA

Subtitle:  It Took 30 Years But We Made Wind Profitable

This is just a start on a longer article that discusses why we have wind energy subsidies and grants in the US.   The short answer is, the US government got tired of having to import energy and at one point the experts told government we were running out of natural gas.  The gas industry took that as a challenge and proceeded to drill in novel ways and find huge amounts of natural gas.    Gas became cheap, and wind energy could not yet compete, so government extended the subsidies until 2021.  By then, onshore wind turbine generators can compete without assistance.    This will be added to from time to time. 

Some of these events are described briefly by the DoE at this link.

1973 - Arab oil embargo increased gasoline prices; 1973 and again 1979 with Iranian revolution.  America decides to act, to reduce our energy consumption across all sectors.

1977 President Carter's famous sweater speech; he tells the nation we are running out of energy (including natural gas) and all must conserve. Public fountains across the US go dry as pumps are switched off.  Cities and towns across the US have no Christmas lights that year. 

1978  President Carter signed PURPA, the Public Utilities Regulatory Act, which made utilities purchase electricity from small renewable plants, including wind.  Industries across the country built their own cogeneration plants over the next decade to supply electricity and steam to the processes.  

1980 - First large wind farm was built at Altamont Pass, California - bad design, too many perches for birds, developers discover the wind in California is weak at only 26 percent capacity factor.

1981 - NASA scientists develop Viterna Method for wind blade calculations

1988 10 MW lead-acid battery installed in Chino, California

1990s - faster computers allow better calculations.  Wind blade calculations are long and complicated, so that fast computers are required to give optimal solutions. 

1992  -  President George H.W. Bush signed The Energy Policy Act, which authorizes a production tax credit of 1.5 cents per kilowatt hour of wind-power-generated electricity and re-establishes a focus on renewable energy use.  The PTC increases over time with inflation.  Presently is at 2.3 cents per kWh. 

1993  DoE builds the National Wind Technology Center to test wind systems

1996  5 MW lead-acid battery for grid-scale storage installed at Vernon, California

2008  The U.S. Department of Energy publishes their 20% Wind Energy by 2030 report

2008  US installed wind capacity reaches 25.4 GW. 

2008  US wind energy production exceeded 1 percent of all electricity for the first time.  Wind was 1.34 percent of all electricity sold in the US that year.   Wind output jumped 62 percent over the previous year. 

2011  The U.S. Department of Energy releases the National Offshore Wind Strategy in partnership with the Department of the Interior to reduce the cost of energy through technology development and reducing deployment timelines. In the following year, three offshore wind demonstration projects are chosen as a part of this $168 million initiative.

2012  US installed capacity reaches 60 GW.  Annual electricity produced was barely under 3 percent (2.93) of all US electricity sold.  The wind output had more than doubled in just 4 years.   The annual growth rate was astounding, at 27 percent per year.    Much of the new capacity is in the fabulous wind in the Great Plains region of the US, from Canada to Texas and Colorado to Missouri. 

2013 First Grid-Connected Offshore Wind Turbine in the U.S., a small, 20 kW unit offshore Maine, with Dept of Energy funding.  A storage battery on California's Santa Catalina Island was installed, at 1 MW and 7 hours capacity.   (This was to allow the diesel generators to run constantly rather than cycle on and off, which created more air pollution). 

2014  8 MW, 4 hours,  grid-scale battery for wind energy storage installed at Tehachapi, California

2015 The Wind Vision Report is released showing that 35% wind energy is possible by 
2050.  Installed capacity reaches nearly 74 GW, while electricity produced was 4.68 percent of the total.  Grid-scale batteries for storing electricity are installed in California. 

2015 Wind technology improved dramatically, with onshore projects in the Great Plains region profitable with only 4.3 cents per kWh (total) sold.  Installation costs fell to $1600 per kW nameplate capacity.  Annual capacity factors in the best locations exceed 40 percent.  

2016 First grid-scale offshore wind farm starts operation offshore Rhode Island, the Block Island project with 30 MW using 5 turbines of 6 MW each.  Production tax credit is reduced over several years and ends completely in 5 years. 

2017 Total installed capacity reaches 84,000 GW.   In early 2017, wind energy exceeded 8 percent of all US electricity sold on a monthly basis.  EIA numbers show that wind energy output was as much as hydroelectric power output. 

2017  Oklahoma announces approval and financing for a 2,000 MW wind energy farm in the panhandle region, having 800 turbines at 2.5 MW each.  

2017  70 MW total of grid-scale batteries, all 10 MW or larger, operating in Southern California.  The two largest are 30 MW each.  

2017 Contracts are signed for a 100 MW, 85 MW and a 50 MW battery systems, for Long Beach and Los Angeles, respectively. Storage is 4 hours for the 100 MW battery. 

Roger E. Sowell, Esq.
Marina del Rey, California
copyright (c) 2017 by Roger Sowell - all rights reserved



Topics and general links:

Nuclear Power Plants.......here
Climate Change................here  and here
Fresh Water......................here
Engineering......................here  and here
Free Speech.................... here
Renewable Energy...........here  




Friday, August 4, 2017

Offshore Wind Turbine Project – Statoil’s Hywind Scotland

Subtitle: A Positive Viewpoint
By Roger Sowell (1)
Figure 1 Artist's Depiction - Hywind Scotland
credit Statoil ASA Environmental Statement


Background
This article is the result of a request by Charles The Moderator (CTM) for me to write a more in-depth piece on my views of wind energy systems.   About one week ago, WUWT had an article bashing the Hywind Scotland wind farm (7/28/2017, see link) on which article I offered a few comments.  I also added a link on the Tips and Notes page to the Hywind Scotland project’s Environmental Statement (ES).  That ES is the rough equivalent to an Environmental Impact Report in the US.  Many technical details are included in the ES.  That note in Tips and Notes prompted CTM to ask me to write this article. 

Having withstood for several years the slings and arrows (including libel) of many commenters and guest bloggers at WUWT, I was reluctant to write a positive piece on wind energy.   I reserve such articles for my own blog.  But, CTM is a persuasive and charming fellow, and I agreed to write this.  I have attempted to use plentiful references and citations throughout, and those only from reputable sources.  For example, Statoil’s claims to 40 years offshore experience, built and operated more than 40 offshore oil and gas structures, some of those offshore structures are powered from shore by undersea cables, and the details of their Troll platform, are from Statoil’s own documents online.  If those facts are in error, the fault is theirs.  However, those facts also align with my memories of working with Statoil guys over the years.

Forging ahead, it should be remembered that another article of mine is online at WUWT (and my own blog), on the serious consequences of breaking the libel laws online.  See link to “Climate Science, Free Speech and Legal Liability - Part 1.”  In plain English, it is OK to disagree, but argue your points with facts, and argue politely. 

Introduction
            This article’s overall topic is part of the questions, what should a modern civilization do to look to its future electrical energy needs?   Then, what steps should be taken now to ensure a safe, reliable, environmentally responsible, and cost-effective supply of electricity will be available in the future?   These questions have no easy answers; they occupy a very great deal of time, energy, and written words.
          
  More to the point, what should an advanced society do in the present, when it is very clear that two of the primary sources of electric power will be removed from the generating fleet with 20 years, and half of that removed within 10 years?
            
Two scenarios are discussed: first the world electric generating situation, then that in the United States.  
            
The basic facts are these: at present, worldwide electricity is provided by six primary sources: coal burning, natural gas burning, nuclear fission, hydroelectric, oil burning, and a mix of renewable energy systems.  Of the renewables, most of the power is from wind turbine generators (WTG), second is solar power, and the rest is from a few other sources that include geothermal, biomass, biogas, and others.  (source: EIA and other reputable entities).  For approximate percentages, in 2012 the world’s electric power was provided by Coal 39.6, Natural Gas 22, Hydroelectric 17.6, Nuclear 10.7, Oil 5, Wind 2.4, Solar 0.5, and Other 2.1.  Figures for different countries are available from various references.

            In the United States, however, the mix of energy sources is changing rapidly over the next two decades.   The essential facts in the US are a great number of nuclear plants will retire; many coal-fired plants will retire, many natural gas plants will be built; and a great number of wind turbine generators will be built.   Within 20 years, almost every one of the 98 nuclear plants in the US will retire.  Half of those will be shut down within 10 years.    That is most significant, because coal plants produce 30 percent and nuclear plants produce 18 to 19 percent of all the electricity in the US.  With most of those shut down in 20 years, the US is facing a deficit of almost one-half of the electricity supply.  In energy terms, coal and nuclear provide approximately 2,000 million MWh per year. (EIA for 2016).  For the shorter term, ten years from now, one-half of those shutdowns will occur, leaving a shortfall of 1,000 million MWh per year.

            An aside to look more closely at coal burning power plants and their rapid closures in the US.  Coal is no longer king, no matter what anyone says about the matter.  The fact is, as I have long stated and written, that coal burning power plants were intentionally given a pass on environmental issues.  They were not forced to comply with many of the environmental requirements of the US Clean Air Act.  Instead, the coal industry found ways to “perform maintenance” that added capacity, while retaining the grandfathered status.  Only a few coal burning power plants were required to comply with the pollution laws.  Recently, that all changed.  Now, coal burning power plants are closing in record numbers because the owners cannot afford to install the expensive pollution control equipment. (Reference:  MIT paper, 2016,  MITEI-WP-2016-01;  also see http://www.law.nyu.edu/sites/default/files/2016-ELI_Grandfathering.Coal_..Power_.Plant_.Regulation.Under_.the_.CAA_.pdf )    I am aware that this is a controversial statement at WUWT, having made this statement before and receiving blistering comments on that.  Yet, facts are very stubborn things; they do not care one bit what anyone thinks of them.  Facts just are. 

            The facts of US nuclear power plants are just as plain: the fleet of 98 plants is aging.  Almost half, 47 out of 98 still running, are between 40 and 47 years old.  (reference:  https://www.eia.gov/nuclear/spent_fuel/ussnftab2.php  )     Within 10 years, it is almost certain that all of those reactors will be shut down permanently and retired.   Many of the nuclear plants are losing money and have done so for a few years.  Some have received direct government subsidies recently to keep running.  These direct payments are in addition to the numerous other subsidies that US nuclear plants receive, such as for indemnity from radiation releases, federal guarantees on construction loans, softening of safety regulations, laws prohibiting lawsuits during construction, and others. .

            In the arena of electricity generation at grid-scale, conventional and new technologies contend for market share.  Over the past decade, new technologies that use renewable energy as the motive force have become more prevalent.  Wind and solar technologies are two that are presently at the forefront of market share and development effort.   As the traditional mix of generating technology changes in the next two decades, wind energy will certainly play a greater and greater role.   In early 2017, combined output from hydroelectric and renewable sources slightly exceeded nuclear power plant output (Figure 1 from EIA, figures in billion kWh per month).   Also notable from Figure 2 is the almost complete absence of energy from wind (dark green area) before 2010.   


                                                      Figure 2  US Renewables with Hydro v Nuclear

The growth of wind energy has been substantial in only 7 years, from almost zero percent to 7.5 percent of US total electricity.   The growth in wind energy is shown also in Figure 3, where wind energy, for the first time, was the same as the output of hydroelectric plants in 2014-2015.  As an aside, Figure 3 is the real hockey stick.  The data is from EIA, but the graph is my own.  This graph made quite a splash on Twitter on 5/2/2016 among the #windenergy crowd.  (@rsowell is my handle)

Figure 3  US Hydro v Wind Energy

The US has more than adequate wind resources and natural gas resources to fill the generating gap from retired nuclear and coal power plants.  Onshore wind capacity at present stands at a bit more than 84,000 MW, (windexchange reference)  with another 25,000 MW under construction.   Natural gas power plants of 190 GW could easily be built to meet the need.  Wind turbines of 170 GW could be installed and remain well below 20 percent of all electricity generated annually.  The added 170 GW of wind is well below the estimated 11,000 GW of wind capacity that exists onshore in the US.(Lopez, A. et. al. Technical Report NREL/TP-6A20-51946, July 2012)  These figures, 190 GW for natural gas, and 170 GW for wind energy are found as follows.   The need is for new natural gas power plants to generate 1,000 million MWh per year.  By dividing 1000 million by 8766 hours per year we obtain 114,076 MW (and multiply by 1 million).  By then dividing by 0.6, the natural gas power plant capacity factor, we obtain 190,127 MW or 190 GW to install.

The 170 GW of wind capacity to install over the next decade is found similarly, but using 0.35 as the capacity factor.  The desired result is to have wind energy make up 20 percent of the total electricity in the US annually, the “penetration” as it is known.  With existing wind energy already at 7 percent penetration, the need then is for 13 percent from new wind turbines.  Multiplying 0.13 times 4,000 million MWh/y we obtain 520 million MWh/y.  As before, we divide by 8766 and multiply by 1 million to obtain 59,320 MW.  This divided by the capacity factor of 0.35 gives 169,486 MW, which is rounded nicely to 170 GW of new wind capacity. 

            The nice result here is that total installed natural gas power plant capacity would exceed wind plant capacity.   Therefore, when wind speed declines below generating speed, the natural gas power plants have plenty of capacity to make up the power deficit.   Wind generating capacity at present is approximately 84 GW, and the new capacity to install is 170 GW.   The total of 250 GW is less than existing natural gas power plant of approximately 260 GW.  When the new natural gas power plant is added, there is 260 (old capacity) plus 190 (new capacity) which yields 450 GW of natural gas power plant capacity. 

            This gives a viable solution for the first ten years.   Natural gas capacity would be 450 GW total, wind would be 250 GW total, and wind penetration would be a nice, round figure of 20 percent. 

            The second decade would require similar added capacity.   An additional 170 GW of wind capacity would add 13 percent more to the penetration.  That would then be 20 plus 13 for 33 percent total.  That would present almost zero problems on the national grid.    Total wind capacity would then be 250 GW plus 170 GW, which yields 420 GW. (reference DOE Wind Vision site states slightly more than 420 GW can be added by 2050 in their analysis.  https://energy.gov/eere/wind/maps/wind-vision  )   Natural gas capacity would be another 190 GW, for a total then of 450 plus 190 to yield 640 GW.  With 640 being comfortably greater than 420, there is adequate natural gas power plant capacity to take over when the wind speed declines. 

            One question arises, then; can wind turbine generators be added at a rate necessary to achieve 170 GW over ten years?  That is an average of 17 GW per year.  From actual history, it is noted that in 2012, US wind capacity of a bit more than 13 GW was added.   Also, 10 GW was added in 2009.   It is clear, then, that 17 GW per year should be no problem.   The US wind energy supply chain would be required to increase output by 4/13 or approximately 30 percent.

            A second concern sometimes is expressed, as the land area required for a large number of wind turbines.  That is not a problem, however.  Studies of actual, modern, efficient wind farms found that on average, total land required is 85 acres per MW installed capacity. (Reference:  Land Use for Wind Farms  Technical Report NREL/TP-6A2-45834, August 2009  http://www.nrel.gov/docs/fy09osti/45834.pdf  ) The study used hectares, giving 34 h per MW.   Converting appropriately, we obtain 85 acres per MW installed. The total land area, then, for 420 GW or 420,000 MW of wind capacity is 85 multiplied by 420,000 and divided by 640 acres per square mile.  The result is then 55,800 square miles when rounded up a bit.    For perspective, that is almost exactly the area of the state of Iowa, which has 56,272 square miles.   Of course, the wind parks would be spread out over the states and not all concentrated in Iowa.    Another consideration is almost all of the land with wind turbine generators can and would be used for its original purpose. 

            Why the focus on wind and natural gas?   One might prefer to build sufficient nuclear plants or more coal power plants instead of wind and natural gas power plants.  Nuclear and coal power plants are discussed below.

It would be extremely difficult, if not impossible to build a sufficient number of nuclear power plants – 40 to 50 of them – in the next decade to replace those that retire.  Recent news (7/31/2017) shows that the two new nuclear plants under construction in South Carolina at the V.C Summer plant have been halted with no intention to finish building them.  (see https://www.bloomberg.com/news/articles/2017-07-31/scana-to-cease-construction-of-two-reactors-in-south-carolina )  The South Carolina plants are approximately 35 percent complete, many years behind schedule and several $billion dollars over budget.  The projects were halted when the revised estimate to complete showed $26 billion.   In order to start up 40 to 50 nuclear plants ten years from this date, the 40 to 50 plants must be approved and under construction today also.  Clearly, that has not happened.   New nuclear plants also have a very high price for electricity produced. 

 It would also be unwise to build new coal-burning power plants since the remaining amount of US coal that can be mined at a profit is limited to 20-30 years or less at current prices.  (Reference: Luppens, J.A., et al,  2015, Coal geology and assessment of coal resources and reserves in the Powder River Basin, Wyoming and Montana: U.S. Geological Survey Professional Paper 1809, 218 p., http://dx.doi.org/10.3133/pp1809 )   If coal prices rise, perhaps by increased demand or subsidies, more coal can be mined.  However, high coal prices require a coal burning power plant to have higher electricity sales prices.  That simply would not occur with natural gas and wind power at such very low prices as today.   New coal-fired plants would lose money, just like the new nuclear plants would.

World-wide, the numbers are similar.  Coal production is limited to no more than 50 years, unless some force increases the price at the mine-mouth.  (Rutledge, David, "Estimating long-term world coal production with logit and probit transforms,"    International Journal of Coal Geology, 85 (2011) 23-33              http://www.its.caltech.edu/~rutledge/DavidRutledgeCoalGeology.pdf )


Why onshore wind?    
Why, then, the big push for wind technology?  Below are listed a few reasons in support of wind power.  Following that is a description in some detail the new 30 MW Hywind wind park being installed off the northeast coast of Scotland by Statoil. 

Onshore wind farms have benefited greatly from private and public funding over the past decade.  The wind turbine generators are already low-cost to install and operate.  Projects are profitable in the Great Plains region of the US where the sales price for power is 4.3 cents per kWh. (source: 2015 Wind Technologies Market Report  https://emp.lbl.gov/sites/default/files/2015-windtechreport.final_.pdf  ) The federal subsidy is to end in 3-4 years.    Most importantly, the installed cost has steadily decreased over the years, by a factor of 3 in the past 7 to 8 years.  The low capital cost is the primary reason that wind power is being installed at 8 to 13 GW per year in the US.   It must be acknowledged that the reductions in capital cost per kW occurred only because the federal and state subsidies for wind technology allowed developers to design, build, and install better and better designs.  Whatever arguments there may be against subsidies, wind turbine generators have benefitted substantially from the subsidies.

            Installed costs will continue to decrease as more improvements are made.  Designers have several improvements yet to be implemented such as larger turbines, taller towers, and increased capacity factor.   Oklahoma just announced a 2,000 MW project with 800 turbines of 2.5 MW each.  Onshore wind farms will soon have the larger size at 4 MW then 6 MW turbines similar to those that are installed now in the ocean offshore. 

            Wind repower projects have even better economics.  Repowering is the replacement of old, inefficient wind turbine generators with modern, usually much larger, and much more efficient systems.   The wind will not have changed, was not used up, in the same location.   In fact, the taller turbines reach higher and into better wind that typically has greater speed and more stability.  The infrastructure is already in place for power lines and roads.   Repowering may be able to incorporate legacy towers as the upper section of new, taller towers for larger wind turbine generators. 

            Wind power extends the life of natural gas wells.  Wind power creates less demand for natural gas.  This reduces the price of natural gas.  That helps the entire economy, especially home heating bills, plus the price of electricity from burning natural gas.   But, this also reduces the cost to make fertilizer that impacts food, since natural gas is the source of hydrogen that is used to make ammonia fertilizer.

            Wind power is a great jobs creator.  Today, there are more than 100,000 good jobs in the US wind energy industry.  Many of the wind industry jobs are filled by aeronautical engineers.  Instead of designing airplanes with two wings that fly in a straight line, they design wind rotors with three wings that turn in a circle.  There are approximately 1.2 jobs per MW of installed capacity, with 84,000 MW and 100,000 jobs.  That’s approximately the same ratio as in nuclear power plants, with 1 job per MW. 

            Wind provides security of energy supply.  No one can impose an embargo on the wind.  There are no foreign payments, and no foreign lands to protect with the US military. 

            Wind provides a good, drought-independent supplemental income via lease payments to thousands of families nationwide, due to the distributed nature of wind turbine projects.   Almost 100 percent of the land can continue in its original activity, grazing cattle or farming.  Marginal land with no economic activity now produces income for the landowner.  85 acres is required for 1 MW of WTG. 

            Wind power promotes grid-scale storage research and development.  Wind energy generated at night during low demand periods can be stored then released when demand and prices are higher.  As always, some losses occur when energy is stored and released later.   Storage and release on demand has spinoff into electric car batteries.  EVs will reduce or eventually eliminate gasoline consumption, and that will spell the end for OPEC.   The entire world’s geopolitics will change as a result.   Recently, the CEO of BP, the major international oil company, predicted that the next decade or two would bring such a surge of EVs that oil demand would peak, then decline.   The CEO is right, too.  When it becomes patriotic to drive an EV rather than a gas guzzler, EV sales will zoom.   A gas guzzler will be seen as an OPEC enabler.

            Wind power hastens nuclear plant retirements as electricity prices decline.  Nuclear plants cannot compete with cheap electricity from cheap natural gas.  As stated above, wind energy keeps natural gas prices low by reducing the demand for natural gas.

            Power from wind is power without pollution.  Wind power has no damaging health impacts from smoke, particulates, or noxious sulfur or nitrogen oxides.   The American Lung Association encourages clean, pollution-free wind power.

Summary to this point.  
The utility-scale power generation mix in the US will change substantially, even dramatically over the next ten and twenty years.  Nuclear power will be almost non-existent.  Coal power will also be greatly reduced or almost absent.  Wind power will be four to five times as much capacity and generation compared to today.  Natural gas power will grow to replace the nuclear and coal production, but will loaf along as wind generation occurs.   Only when the wind dies down will natural gas power plants roar to life at full throttle.   This describes the US situation.

            Several other nations also have similar issues to face.  Of the approximately 450 nuclear power plants still operating world-wide, roughly one-half will retire within 20 years, and for the same reasons as do those in the US.  Old age, inability to compete, and safety concerns will shut them down.  A similar analysis can be done for each major nuclear power country with aging reactors, including Japan, France, Canada, UK, and Germany.   On average, with 20 years being exactly 240 months, that is roughly 1 reactor per month to be retired.   The booming business of the future will be reactor decommissioning. 

            Next is part two, the specifics on offshore wind and the Hywind Scotland wind park.

Why, then, offshore wind?
            In addition to all the benefits of onshore wind power listed above, offshore wind farms have a few benefits of their own.  First, a couple of drawbacks that exist with offshore wind power.  It is well-known that offshore wind power has higher costs to install, and higher operating costs due to accessibility issues when compared to onshore wind farms.  However, these drawbacks are somewhat offset by the much larger wind turbine generators that can be installed, taller towers, and better wind as measured by both velocity and stability.    Lease payments do not flow to private landowners, typically, but to the government that controls the local part of the ocean.

            For areas that do not have the very good onshore wind that exists in the interior of the US, offshore may be an ideal place to develop wind energy. 

            Larger turbine designs for offshore wind projects can be evaluated and adapted for onshore projects. 

            Much of the world’s population lives in cities near the ocean.  Transmission lines to bring the energy from the offshore wind turbine generators to the cities may be shorter, compared to running long distances overland.

            For those who cannot see the beauty in a technologically advanced wind farm, an offshore wind farm can place the systems out of sight. 

            The marine industries get a boost with offshore wind farms. 

            Offshore wind farms are ideally situated for a few forms of grid-scale storage.  In particular, one of those is pumped storage hydroelectric with the ocean as the lower reservoir and a dedicated lake higher up onshore.   Another form is the MIT submerged storage spheres.

            Offshore wind farms very recently, Spring of 2017, won an auction in Germany that contained zero government subsidy as part of the bid.  With more and more advances in the technology, the era of subsidized offshore wind farms may be over.   Time will tell.

            Offshore wind farms bring additional capacity to play.  Using the US for example, the government estimates 11,000 GW of wind capacity is economically feasible onshore.  An additional 4,000 GW of wind capacity is economically feasible offshore.   Offshore wind power increases the US total by a bit more than one-third.

            Finally, offshore wind power brings affordable electricity to islands that presently have very expensive electricity due to burning oil in power plants, or diesel in piston-engine generators.  Offshore wind power is a mainstay of Hawaii’s plan to obtain 100 percent of the electricity in the islands from renewable sources.   Some storage will be necessary to balance out the fluctuations in demand. 

            The Hywind Scotland floating wind farm uses the moored spar technology, appropriately modified for the single-tower system of a wind turbine generator. 

Hywind Scotland Project


Figure 4 Conceptual Layout From Hywind Environmental Statement

            Technology 

            As depicted in Figure 4, Hywind Scotland has five floating, seabed-moored spar-type wind turbine generators rated at 6 MW each for 30 MW installed capacity.    Note, these are the same size as the offshore wind park in Rhode Island in the US.  Block Island system offshore Rhode Island started production in 2016.  Note, however, the Block Island system’s towers are not floating, but are anchored to the ocean floor.

            Each Hywind Scotland WTG has three mooring lines anchored to the seabed.  These mooring lines split into two, so there are six anchor points on the floating tower.   (ES 4-5)  see Figure 5 below.
Figure 5 Undersea Mooring Schematic - from ES



            WTG has a proprietary motion compensation system to ease the load on critical bearings.  (ES 3-1)

            WTG has three rotor blades.   The rotor blades are pitch-controlled.  Rotating speed varies with wind strength, from 4-13 RPM (ES 4-19).

            The WTG are provided by Siemens, a major vendor of offshore wind turbine generators.  The model is SWT-6.0-154.   Access is available by boat and a ladder system inside each tower.

            Hub height for the WTG is 101 meters above sealevel.

            Cut-in wind speed where power generation begins is 3-4 m/s.   Cut-out wind speed for WTG protection is higher than 25 m/s.    (6.6 mph – 55 mph)  (ES 4-19)  See Figure 6 for wind direction and range of speeds at the site.   Wind speed is higher than cut-in speed more than 95 percent of the time.
Figure 6 Wind Rose Showing Direction/Speed - from ES

            Power is collected from the 5 WTGs and brought to shore via a single cable along the seabed, length approximately 25 to 35 km.  The power is tied into the national grid.  Power is at 33 KV, 50 HZ and AC.  Undersea power cable to shore is armoured and 0.5 m diameter.   Power can be drawn from shore if the need arises.   Diesel-powered generators can also be used at any WTG (ES 4-6)

            Each WTG is connected via inter-array cable, 33 kV at 50 HZ and AC.  Cables are armoured and approximately 0.5 m diameter.   The temporary loss of any one WTG for repairs or maintenance will not affect the output of the others.   (ES 4-5)

            A smaller floating WTG prototype operated 10 km off the west coast of Norway since 2009 to 2014 and withstood 20 m waves and 40 m/s winds  (approximately 88 mph).  The prototype was a single WTG with 2.3 MW capacity. (ES xi and 3-1)

            Seafloor area required is 15 km-2.  With capacity of 30 MW, the ratio is 2 MW per km-2.  (ES 4-2)

            Water depth is 95 – 120 meters (ES 8-8)

            Each of the WTG Units will be equipped with code-compliant navigational lights for marine operations and aviation that will automatically turn on in the dark.  (ES 4-7)

            Statoil ASA, a Norwegian oil and gas company, is the designer, and investor.   Statoil has more than 40 years of offshore oil and gas experience with more than 40 separate offshore installations, most of which are in the harsh conditions of the North Sea.   Statoil designed and built the world’s largest object that was ever moved over the Earth’s surface, the Troll A platform.  Troll A was designed in the late 1980s, approximately 30 years ago.  It began operating in 1996.  Troll A is a complex concrete and steel structure that sits on the ocean floor in more than 300 meter deep water.  The platform itself is far above the ocean surface.  Troll A is more than 470 meters from top to bottom.   Statoil also has long experience with power cables along the ocean floor from shore to offshore structures. 

            Hywind Economics
            Economics are improved over the initial one-turbine, 2.3 MW prototype.  The prototype generated 40 GWh over several years and demonstrated a 50 percent annual capacity factor during one year.  Lessons learned at Hywind Scotland’s 30 MW system will be employed in future, large-scale wind parks.   Hywind Scotland’s installed cost is GB £210 million (approximately US$276 million.  $/kW = 9210.)  But, this includes undersea cables.   Note, this is just a bit less than the Block Island 30 MW system in the US, which cost US$300 million.

The unsubsidized economics for the small, 30 MW Hywind Scotland system gives a sales price of electricity at $215 per MWh sold for a 12 year simple project payout.   This is based on 45 percent annual capacity factor and investment as above.  Revenue would be an average of $23 million per year.   With public funding sources as described in the Environmental Statement, the economics are very likely substantially better.   This price point, $215 per MWh, is competitive with peaker power prices. 

With economy of scale and 60 percent reduction in installed cost for a larger 600 MW park, and 12 year simple project payout, no subsidies, the electricity could be sold at $89 per MWh.   At that price point, offshore wind becomes competitive with baseload natural gas power with LNG at $10 per MMBtu as the fuel used. 

Bird Collisions
The environmental impact on numerous species are included in the Environmental Statement.  The impact on birds is summarized here.

Avian collision mortality was predicted in the Environmental Statement for species that commonly fly at rotor height (101 m) using a range of modelling scenarios. This showed that the predicted additional mortality was negligible compared to the numbers of birds that die from existing background mortality causes. (ES 11-1)

With one exception, predictions of the size and duration of potential impacts shows that for all species for all times of year effects would have negligible impact on receptor populations. The exception is razorbill, for which a potential disturbance effect of low impact for the breeding population is identified owing to the very high densities sometimes present in August, a period when individuals of this species have heightened vulnerability to disturbance. This impact is nevertheless judged not significant.  (ES 11-1)

The negligible impact conclusion is consistent with studies in the US on bird mortality from wind turbines.  In the US, approximately 1 billion birds die annually from various causes.  Ninety-six percent of those are caused by collisions with buildings, power lines, automobiles, and encounters with cats.  Less than 0.003 percent were due to wind turbine impacts.  (Erickson et.al, USDA Forest Service General Technical Report PSW-GTR-191 (2005), Table 2  https://www.fs.fed.us/psw/publications/documents/psw_gtr191/psw_gtr191_1029-1042_erickson.pdf   )  In addition, bird fatalities decline as older, truss-style support towers are demolished and modern, monopole support towers are installed.

Conclusion
There is a need for electric power generation technologies to replace the rapidly aging and retiring nuclear power plants in several countries within the next decade.  Also, coal at today’s prices has a limited horizon of 20 to 50 years.  In the US, coal power plants are shutting down due to pollution equipment costs.  It is prudent to develop safe, reliable, and affordable means of generating power.  Wind power has improved dramatically in the past decade to take its place as such – safe, reliable, and affordable.  More improvements are identified and already in the pipeline.   In addition, wind as an energy source is eternally renewable and sustainable.  The benefits of reduced natural gas demand, lower natural gas price, less air pollution, improved human health from lung diseases, economic benefits for land owners with wind farm leases, increased jobs, increased domestic manufacturing and service businesses, all make wind energy desirable.

The offshore, 30 MW Hywind Scotland floating spar wind energy system is built and backed by the very experienced Norwegian company, Statoil ASA.  Even though it has subsidies, the project’s unsubsidized economics would make it attractive against peaker power plants.  The improved economics due to economy of scale will make this competitive with main gas-powered plants where LNG is imported for fuel.  The Hywind Scotland technology for wind turbine generators, floating moored spar supports, and undersea power cables is already proven.   The location chosen, off the eastern seaboard of Scotland, has excellent wind with 40 to 50 percent capacity factor.

A 600 MW or larger offshore wind farm using the Hywind Scotland design can be expected in the next decade.   Wind energy technology continues to improve with demonstrated, year-over-year reductions in cost to install. 

Additional References:
http://www.4coffshore.com/windfarms/hywind-scotland-pilot-park-united-kingdom-uk76.html

Abbreviated in this article as ES:    https://www.statoil.com/content/dam/statoil/documents/impact-assessment/Hywind/Statoil-Environmental%20Statement%20April%202015.pdf


Footnotes (1)     Roger Sowell is an attorney in Science and Technology Law.  Since earning a BS in Chemical Engineering in 1977, he has performed a great many engineering consulting assignments worldwide for independent and major energy companies, chemical companies, and governments.  Cumulative benefits to clients from his consulting advice exceeds US$1.3 billion.  Increased revenues to clients are at least five times that amount.   He regularly makes public speeches to professional engineering groups and lay audiences.  He is a regular speaker on a variety of topics to engineering students at University of California campuses – UCLA and UC-Irvine.  He is a founding member of Chemical Engineers for Climate Realism, a “red-team” style think-tank for experienced chemical engineers in Southern California.  He is also a Council Member with the Gerson Lehrman Group that provides advice to entities on Wall Street.  He publishes SowellsLawBlog; which at present has more than 450 articles on technical and legal topics.  His widely-heralded Truth About Nuclear Power series of 30 articles has garnered more than 25,000 views to date.  Recently (2016), he was requested to defend climate-change skeptics against an action under the United States RICO statutes.


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