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View Diary: solar PV at half the cost of Grid power (26 comments)

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  •  suggest you dig a little deeper, (0+ / 0-)

    especially looking at the natural gas "backup" to be installed by the contracting company.

    I suspect that you'll find that the majority of the power delivered under this contract will come from the "backup" generators, at substantial profit to the contracting company (natural gas generated electricity is currently coming in at around 4 cents/kwh).

    Fake Left, Drive Right . . . not my idea of a Democrat . . .

    by Deward Hastings on Tue Jun 25, 2013 at 08:57:15 AM PDT

    •  you are welcome (0+ / 0-)

      to do the research.

    •  your accusation has in it's core a dangerous (1+ / 0-)
      Recommended by:
      Lawrence

      business assumption..

      I suspect that you'll find that the majority of the power delivered under this contract will come from the "backup" generators, at substantial profit to the contracting company (natural gas generated electricity is currently coming in at around 4 cents/kwh).
      Let us assume, what you propose is actually true.

      This is an 80 MW long term Power purchase agreement.
      I'm assuming it's 80 MW of electricity during peak hours
      so 10-6 Monday-Friday, 52 Weeks a year.

      So, best available solar power installs on commercial is about $2.50/watt, so they install $200 million of PV upfront,

      then natural gas peakers are around
      http://en.wikipedia.org/...

      Natural gas-fired peaking power plants are around $6 a watt.[6]
      Add in the 30 year price of natural gas has been all over the map.

      http://3.bp.blogspot.com/...

      What that is is a tremendous variation in price that is locked in against a 30 year PPA, seems like a really crappy bet.

      increase the CAPEX 50%, lock in a 30 year put on electricity
      and need to option now 30 years of gas plus buy 30 years of gas.

      Can you really show me in simple words, how that's a good bet?

      Or are you just making up weird accusations, because you
      don't like solar?

      •  you can "assume" (0+ / 0-)

        whatever you want to "assume", to make whatever argument you want to make.  And readers can be fooled if they want to be.

        You don't seem interested in exploring what will actually keep the lights on in Palo Alto.  I have no interest in speculating why that is.

        Fake Left, Drive Right . . . not my idea of a Democrat . . .

        by Deward Hastings on Tue Jun 25, 2013 at 11:54:09 AM PDT

        [ Parent ]

        •  Details, please? You could both be right. (2+ / 0-)
          Recommended by:
          Sparhawk, Deward Hastings

          I'm just an interested reader looking for info.

          D.H. is fairly clearly saying (a) the solar power provider has a natural-gas backup; (b) the gas backup will likely provide most of the power; (c) the city could've just bought gas power labeled as gas power and saved money.

          Patbahn...I'm sorry, but I'm not a financial analyst and I'm having trouble following your jargon-filled reply. I get that you don't think D.H.'s point makes financial sense, but I don't get why.

          My own 2 cents:

          1. The price of solar is likely to fall over 30 years. By making a 30-year commitment, the city is taking a long-term risk of overpaying in order to (a) save money in the short term (which may or may not happen, depending on whether D.H. is right), and (b) jump-start solar power for the greater good.

          2. Even if D.H. is right in the short term, the price of natural gas is likely also subject to long-term fluctuation, especially if greenhouse emissions get restricted or priced sometime in the next 30 years. By purchasing a 30-year bundle of mixed gas-solar power, the city is hedging its bets--diversifying to mitigate risk. The city will neither reap all the rewards of the more efficient 30-year power source, or suffer all the costs of the less efficient 30-year source. The city is acknowledging that it's impossible to know which source will be cheaper over the next 30 years. If that's what's happening, it seems reasonable.

          "The true strength of our nation comes not from the might of our arms or the scale of our wealth, but from the enduring power of our ideals." - Barack Obama

          by HeyMikey on Tue Jun 25, 2013 at 12:10:37 PM PDT

          [ Parent ]

          •  you basically captured it. (1+ / 0-)
            Recommended by:
            HeyMikey

            See DH is proposing that this Solar system will actually have a Natural gas turbine behind it that will provide the power.

            My discussion of CAPEX is Capital Expenditure.
            you buy solar systems soup to nuts for about $2.50/watt
            installed (Large Commercial).  You buy gas turbine
            peakers for about $6/watt.  Now to commit to contracts
            in Solar PV, you typically have to overprovision in solar,
            about 3X if you want to maintain absolute grid stability,
            but it's about a wash between the Solar PV and the gas turbine, you only save $1.50 per watt multiplied by a
            yield function which is kind of complicated.

            What's worse is you face tremendous fluctuation in gas
            prices.  Gas gets pricey at times. Plus when the system is
            running you pay a ton to run those.  

            Gas is cheap right now, but against a 30 year contract?
            the fluctuations are crazy.

        •  lets quote your words (0+ / 0-)
          I suspect that you'll find that the majority of the power delivered under this contract will come from the "backup" generators, at substantial profit to the contracting company (natural gas generated electricity is currently coming in at around 4 cents/kwh).
          Suspect...

          Now you don't actually show any data, you
          don't actually cite anything, and you appear to
          be making an accusation that this is a scam
          hidden behind a large capital investment
          and tied to a 30 year contract.

          I showed how to pull off your suspicious activity
          it requires a 50% additional CAPEX and ties to a 30 year
          power price with risk factors all over the place.

          and you refuse to cite a single fact, element, link, anything for your suspicions.

          pity.

          Do you have any evidence?

      •  He's just making up weird, unsubstantiated (1+ / 0-)
        Recommended by:
        patbahn

        allegations and completely ignoring that solar currently cuts into peak power, ie. needs no peakers at this time, and that electricity storage is coming around real fast and will likely see a drop in cost similar to the drop in cost that solar power has gone through.

        You see these kinds of contortions in logic a lot from the strongly pro-nuke crowd.

        Don't let it bother you.

        "A candle loses nothing by lighting another candle" - Mohammed Nabbous, R.I.P.

        by Lawrence on Tue Jun 25, 2013 at 03:27:22 PM PDT

        [ Parent ]

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