Thanks for the presentation. I'm fairly new to this area, mostly coming from the residential side, and I appreciate posts that help me learn more about the complexities of the energy market.
Here in California we have an increasing penetration of renewables. We are fairly large geographically and we have some challenges with interconnections/transmissions but a key part of the solution is to add storage. We are at over 13GW with a goal of 52GW by 2045. At the residential level we are adding more behind-the-meter storage (I have solar panels and am tentatively planning to add storage next year).
My understanding is that Europe is behind California in the adoption of grid-scale storage, though some countries have a fairly large penetration of behind-the-meter storage (Germany). Your presentation does not cover the status of storage, right? Do you have thoughts on the topic? Perhaps future posts?
This is a very useful resource. However your policy pointers at the end need a lot more work. I'm not happy with your statement 'Traditional support schemes do not focus on market value but on maximizing total production (this should be reformed).' The system needs to change where markets are structured to fit in with fluctuating renewable energy sources, not the other way around! Note: energy markets are tightly regulated not 'natural' phenomenon - they need to be re-regulated to suit absorbing higher proportions of solar and wind. In particular we need effective markets for batteries, which we do not have at the moment. As I demonstrated in one of my posts, if we can incentivize batteries then we can make use of very high penetrations of solar pv. See my post 'So how much of UK electricity could solar pv provide?' at https://davidtoke.substack.com/p/so-how-much-of-uk-electricity-could
Thanks for your comment. I agree that my policy pointers need a lot more work. My point was more that there exists quite a few ways of making support schemes. I have only wanted to express my view that it is important to have incentives for the renewables operators to bring the most value to the system. Most value means that we should consider the price signals.
LCOE is a misleading measure of solar cost and you should know that.
It fails to account for the cost of backup capacity for base load balancing of dispatchable generation and the cost of upgrades for grid management, balancing and transmission.
Solar is the MOST expensive form of electric power other than nuclear and peaking plants.
Please present an HONEST case, not a propaganda case.
Again, a very good, data-heavy presentation which offers a very good view of what is happening and why. The slides 32,33,34 are, for me, the most interesting. 32 correctly notes that PV (and wind) focus on maximising output. Slide 33 is an elaboration of this and correctly notes that there is no incentive for installing storage.
Slide 34 then outlines various possibilities as outlined by the Florence School of Regulation. Sadly, the FSR has a wholly market-based approach to solving the “what do we do with the growing surpluses”. Most of these approaches increase complexity because FSR adheres to “markets have a solution if we can only find it”. (in some ways FSR breaks Occams Razor – don’t invent unnecessary entities)
Markets don’t have a solution to this problem, they are cost-optimisation mechs – that is all. The problem with the FSR is that it is a market “priesthood” (“Our market which art in heaven” etc). In common with so many priesthoods it is also hypocritical, with some of the “priests” at the FSR agreeing with me that the route forward is market split and the installation of large-scale storage systems (mostly H2-based – some batts), mostly at grid supply points and then using a combination of markets for a bit of cost optimisation and perhaps capacity markets initially to cover the capacity factor problem. For the avoidance of doubt, I have e-mail trails on this with FSR people confirming their agreement with me. I find it very sad that everything, always rotates back to “more markets” rather than: what is needed, where does it need to be installed, how will it be funded, and how will it make money/what support is needed initially.
Thanks for your comment and appreciation of the presentation. I cannot judge what FSR think, just pointed out that their report is interesting to read ;-)
This is very useful. Thanks for publishing.
I have read some of your articles before, but I did not understand all the terminology, so this helps quite a bit.
Page 9 is particularly useful to me.
Could you explain the "Reverse Duck Curves" in a bit more detail? Is that the cost of electricity storage per hour?
Thanks for the presentation. I'm fairly new to this area, mostly coming from the residential side, and I appreciate posts that help me learn more about the complexities of the energy market.
Here in California we have an increasing penetration of renewables. We are fairly large geographically and we have some challenges with interconnections/transmissions but a key part of the solution is to add storage. We are at over 13GW with a goal of 52GW by 2045. At the residential level we are adding more behind-the-meter storage (I have solar panels and am tentatively planning to add storage next year).
My understanding is that Europe is behind California in the adoption of grid-scale storage, though some countries have a fairly large penetration of behind-the-meter storage (Germany). Your presentation does not cover the status of storage, right? Do you have thoughts on the topic? Perhaps future posts?
TIA.
This is a very useful resource. However your policy pointers at the end need a lot more work. I'm not happy with your statement 'Traditional support schemes do not focus on market value but on maximizing total production (this should be reformed).' The system needs to change where markets are structured to fit in with fluctuating renewable energy sources, not the other way around! Note: energy markets are tightly regulated not 'natural' phenomenon - they need to be re-regulated to suit absorbing higher proportions of solar and wind. In particular we need effective markets for batteries, which we do not have at the moment. As I demonstrated in one of my posts, if we can incentivize batteries then we can make use of very high penetrations of solar pv. See my post 'So how much of UK electricity could solar pv provide?' at https://davidtoke.substack.com/p/so-how-much-of-uk-electricity-could
Thanks for your comment. I agree that my policy pointers need a lot more work. My point was more that there exists quite a few ways of making support schemes. I have only wanted to express my view that it is important to have incentives for the renewables operators to bring the most value to the system. Most value means that we should consider the price signals.
LCOE is a misleading measure of solar cost and you should know that.
It fails to account for the cost of backup capacity for base load balancing of dispatchable generation and the cost of upgrades for grid management, balancing and transmission.
Solar is the MOST expensive form of electric power other than nuclear and peaking plants.
Please present an HONEST case, not a propaganda case.
Thanks for your comment. I don't think that it was a propaganda. I wrote a post on LCOE: https://gemenergyanalytics.substack.com/p/the-imperfect-lcoe-and-cfd
Again, a very good, data-heavy presentation which offers a very good view of what is happening and why. The slides 32,33,34 are, for me, the most interesting. 32 correctly notes that PV (and wind) focus on maximising output. Slide 33 is an elaboration of this and correctly notes that there is no incentive for installing storage.
Slide 34 then outlines various possibilities as outlined by the Florence School of Regulation. Sadly, the FSR has a wholly market-based approach to solving the “what do we do with the growing surpluses”. Most of these approaches increase complexity because FSR adheres to “markets have a solution if we can only find it”. (in some ways FSR breaks Occams Razor – don’t invent unnecessary entities)
Markets don’t have a solution to this problem, they are cost-optimisation mechs – that is all. The problem with the FSR is that it is a market “priesthood” (“Our market which art in heaven” etc). In common with so many priesthoods it is also hypocritical, with some of the “priests” at the FSR agreeing with me that the route forward is market split and the installation of large-scale storage systems (mostly H2-based – some batts), mostly at grid supply points and then using a combination of markets for a bit of cost optimisation and perhaps capacity markets initially to cover the capacity factor problem. For the avoidance of doubt, I have e-mail trails on this with FSR people confirming their agreement with me. I find it very sad that everything, always rotates back to “more markets” rather than: what is needed, where does it need to be installed, how will it be funded, and how will it make money/what support is needed initially.
Thanks for your comment and appreciation of the presentation. I cannot judge what FSR think, just pointed out that their report is interesting to read ;-)