gar
Senior Member
- Location
- Ann Arbor, Michigan
- Occupation
- EE
131109-0937 EST
Suppose you are investor owned electric power utility regulated by a state public service commission. You have been mandated to supply 10% of your energy from renewable sources, such as wind and solar. You have built renewable capacity to meet the 10% averaged over a whole year. This means renewable equipment rating and peak output is many times the average 10%.
On an overall basis coal generated power costs $30 per 1000 kWh ($0.03 per kWh), and renewable costs $ $100 per 1000 kWh ($0.10 per kWh). Logically the renewable is more expensive.
But from a utility buying perspective you want to buy all the renewable wind and solar you can because its incremental cost is zero. The fuel is free. Furthermore you must buy all the available renewable because you need it to meet your mandated requirement.
Change hats to being the consumer. Over the last 10 or so years my electric cost has gone from around $0.10 per kWh to $0.16 per kWh. Why? Because of the state mandated energy efficiency, and renewable energy source requirements. Had our state "green" people been able to get the 25% renewable requirement passed, then there would have been even greater energy cost increases to the customer.
Anyway it is interesting to consider that energy cost is zero if you already have installed energy generation equipment that does not have an ongoing fuel cost. But in reality it is not zero.
For a coal fired power plant a pound of coal is about 0.9 kWh of output energy from a pound of coal. See http://www.eia.gov/tools/faqs/faq.cfm?id=667&t=2
If the coal used to feed the plant is $0.01 per pound, then its contribution to the kWh cost is about $0.01 , and this is an on going cost. Whereas wind is 0.
.
Suppose you are investor owned electric power utility regulated by a state public service commission. You have been mandated to supply 10% of your energy from renewable sources, such as wind and solar. You have built renewable capacity to meet the 10% averaged over a whole year. This means renewable equipment rating and peak output is many times the average 10%.
On an overall basis coal generated power costs $30 per 1000 kWh ($0.03 per kWh), and renewable costs $ $100 per 1000 kWh ($0.10 per kWh). Logically the renewable is more expensive.
But from a utility buying perspective you want to buy all the renewable wind and solar you can because its incremental cost is zero. The fuel is free. Furthermore you must buy all the available renewable because you need it to meet your mandated requirement.
Change hats to being the consumer. Over the last 10 or so years my electric cost has gone from around $0.10 per kWh to $0.16 per kWh. Why? Because of the state mandated energy efficiency, and renewable energy source requirements. Had our state "green" people been able to get the 25% renewable requirement passed, then there would have been even greater energy cost increases to the customer.
Anyway it is interesting to consider that energy cost is zero if you already have installed energy generation equipment that does not have an ongoing fuel cost. But in reality it is not zero.
For a coal fired power plant a pound of coal is about 0.9 kWh of output energy from a pound of coal. See http://www.eia.gov/tools/faqs/faq.cfm?id=667&t=2
If the coal used to feed the plant is $0.01 per pound, then its contribution to the kWh cost is about $0.01 , and this is an on going cost. Whereas wind is 0.
.
