The cost of electricity across the EU

nesf

From The Economist: http://www.economist.com/blogs/graphicdetail/2013/05/daily-chart-4?fsrc=scn/fb/wl/dc/voltsforvolks

What is interesting to note is that if we applied Germany's tax rate to electricity we would be dramatically more expensive than even Cyprus which tops the table well above us currently. This raises interesting questions about why it is so expensive for us to produce one kW of electricity. Yes, definitely economies of scale come in here to some extent, but is it our fuel mix combined with a high wage base that really kills us here? I mean looking at that chart, are we really paying *that* much more in wages than the other countries in Europe or is not going the nuclear route *that* bad cost wise per unit?

Expensive electricity is both bad for business and bad for consumers, so really keeping the cost of electricity down should be a much bigger issue for Ireland than it is at present.

PRAF

nesf wrote: »

From The Economist: http://www.economist.com/blogs/graphicdetail/2013/05/daily-chart-4?fsrc=scn/fb/wl/dc/voltsforvolks

What is interesting to note is that if we applied Germany's tax rate to electricity we would be dramatically more expensive than even Cyprus which tops the table well above us currently. This raises interesting questions about why it is so expensive for us to produce one kW of electricity. Yes, definitely economies of scale come in here to some extent, but is it our fuel mix combined with a high wage base that really kills us here? I mean looking at that chart, are we really paying *that* much more in wages than the other countries in Europe or is not going the nuclear route *that* bad cost wise per unit?

Expensive electricity is both bad for business and bad for consumers, so really keeping the cost of electricity down should be a much bigger issue for Ireland than it is at present.

I assume proximity to fuel sources, as well a lack of economies of scale, are key factors. As high as wages may be vs say average wages must, they must still only make up quite a low percentage of costs in an energy generation company.

Cody Pomeray

Slightly different picture when you compare domestic electricity prices to the EU average in terms of PPP

http://www.seai.ie/Publications/Statistics_Publications/EPSSU_Publications/Price_Directive_2nd_Semester_2011_.pdf

When purchasing power parities are applied, Ireland is 4% below the average in the most significant consumption band DD. In band DC, Ireland is 4% above the average.

Resi Gas Prices in PPP:

Ireland is below the average in all bands, ranging from 10% to 44% below. In band D2 Ireland was 13% below the Euro Area average.

ehh, anyone know where they are getting the 44% figure btw?

100-66=34

fly_agaric

nesf wrote: »

Expensive electricity is both bad for business and bad for consumers, so really keeping the cost of electricity down should be a much bigger issue for Ireland than it is at present.

I thought I had read somewhere, some time ago (not much of a source) that the electricity price was being kept high by the regulator to try and stimulate competition to ESB, which would of course eventually bring down prices (seems mad to me but I suppose that's the logic people who view the world backwards through the binoculars of economics come up with which a simpleton like me could never understand!).

nesf

Is PPP of much relevance here when the main cost component of electricity generation is an imported good for this country? When one is discussing whether electricity should be cheaper of course.

nesf

fly_agaric wrote: »

I thought I had read somewhere, some time ago (not much of a source) that the electricity price was being kept high by the regulator to try and stimulate competition to ESB, which would of course eventually bring down prices (seems mad to me but I suppose that's the logic people who view the world backwards through the binoculars of economics come up with which a simpleton like me could never understand!).

It's very expensive to get into the electricity generation business on a large scale and it takes a long time to start making a profit over your initial investment. If electricity prices in the medium term drop because of some new technology (this does happen in electricity generation) you might find the price/kW doesn't cover the cost of running your generation plants (even things like wind farms have non-negligible running costs because of wear and tear to the mechanical parts of the turbine, quite substantial costs if a generator needs to be rewound etc.).

Think of it this way, if you have 5 million Euro you could build a wind farm or you could put it into a bank. The bank will give you say 3% interest (not realistic, you could do a balanced investment for greater returns but whatever I'm making up numbers here), if you're not guaranteed a return of at least 4-5% from your windfarm per year why would you ever build the wind farm? The wind turbines will need to be replaced 20-25 years down the road (probably sooner because of technological improvements) so you need to get your 5 million back and turn a better profit than 3% a year for it to make any sense from a financial point of view.

PRAF

nesf wrote: »

Is PPP of much relevance here when the main cost component of electricity generation is an imported good for this country?

No, I don't think it is. Not much relevance in terms of the multinational sector either when a company is deciding where to locate

Cody Pomeray

Fair enough point on the PPP but even comparing Euro prices in the higher consumption bands DD and DE (>5,000 kWh), the report states that Ireland was 2% and 15% cheaper than the Eurozone average respectively.

It was only mildly higher than average (108%) for DC band (2,500 - 5,000 kWh).

Granted these stats only apply to residential supply, but it appears that we haven't been doing terribly badly for an island nation with scarce cross border transmission capability.

solas111

We once had close to the cheapest industrial unit charge in Europe and a cheap enough domestic unit too. Then the idiots we elect to run the country decided to stick their dirty noses in. ‘Competition’ they said was what we needed. So they banned the ESB from building new power stations. That didn’t see a rush of Friends of Fianna Fail entering the market so they ordered the ESB to sell off blocks of land near stations to their competitors. The knights in shining armour still didn’t turn up so a few brown envelopes later they ordered the ESB to sell off power stations to competitors. More dodgy letter covers and the ESB were ordered to reduce their share of the market below 40%. There were plenty more similar bright ideas from the wise men in Kildare Street so that the new Gods of the free market like the mighty Quinn could line their pockets and off-shore accounts.

The result is that there is now competition in the market and we have some of the highest unit prices in Europe. The irony is that the ESB is running successful businesses in many other countries where the Kildare Street mafia cannot reach with their dirty, dishonest paws.

nesf

Yes, we seem to be extremely expensive if you use little electricity but pretty cheap considering if you use a lot as a residential customer. It's a bit stranger for business, the key table here is the rankings table, we're more expensive than over 2/3rds of the EU for most areas but we're the 4th most expensive for the IC band and again 11th most expensive for the highest consumption band. (Bigger numbers means cheaper for those who don't want to read the pdf).

I wonder if this kind of pricing structure is common across the EU?

Victor

solas111 wrote: »

We once had close to the cheapest industrial unit charge in Europe and a cheap enough domestic unit too.

Because there was no investment or renewal going on. We are now playing catch-up.

The irony is that the ESB is running successful businesses in many other countries.

Name their foreign generation / supply businesses.

Macha

One of the big reasons our electricity prices can be so high is we generate a lot of our electricity from gas. Over 90% of that gas comes through the UK leaving us exposed to fluctuations in the exchange rate between euro & pound but also to dynamics in the UK gas market. If wholesale gas prices go up in the UK, they will also go up in Ireland.

It's important not to forget the role of taxes in energy prices and of course how energy prices are more important for some sectors than others. For energy intensive industry it can be the biggest or second biggest cost. For the services sectors, it's more likely to be employment costs, property costs and taxes.

DG Energy has an interesting comparison of retail electricity prices across the EU with useful maps that help visualise it better. Starting pg 28:

http://ec.europa.eu/energy/observatory/electricity/doc/qreem_2012_quarter3.pdf

Pete_Cavan

solas111 wrote: »

We once had close to the cheapest industrial unit charge in Europe and a cheap enough domestic unit too. Then the idiots we elect to run the country decided to stick their dirty noses in. ‘Competition’ they said was what we needed. So they banned the ESB from building new power stations. That didn’t see a rush of Friends of Fianna Fail entering the market so they ordered the ESB to sell off blocks of land near stations to their competitors. The knights in shining armour still didn’t turn up so a few brown envelopes later they ordered the ESB to sell off power stations to competitors. More dodgy letter covers and the ESB were ordered to reduce their share of the market below 40%. There were plenty more similar bright ideas from the wise men in Kildare Street so that the new Gods of the free market like the mighty Quinn could line their pockets and off-shore accounts.

The result is that there is now competition in the market and we have some of the highest unit prices in Europe. The irony is that the ESB is running successful businesses in many other countries where the Kildare Street mafia cannot reach with their dirty, dishonest paws.

Perhaps you could tell us when Ireland had "close to the cheapest industrial unit charge in Europe" because I am guessing it was in the 1960s and 70s, shortly after most of our power stations were built. Today ESBs assets are quickly becoming obsolete and will require major investment to upgrade. SSE is currently constructing a 460MW CCGT (combined cycle gas turbine) at Great Island, Co. Wexford, which is expected to be commissioned in 2014. They also have eceived full planning permission for a proposed 450MW CCGT plant at Tarbert, Co. Kerry and development sites at Lanesboro and Shannonbridge. I would be more confident of SSE and the future owner of Bord Gais Energy making further investments than ESB upgrading Moneypoint which can consume up to 7,000 tonnes of coal per day.

What we have now is not competition. Under Directive 2009/72/EC EU member states are required to separate transmission from generation and supply activities. Ireland currently does not comply with this because EirGrid is licensed to act as transmission system operator (TSO) and is responsible for the operation and development of the transmission grid while ESB still own the assets is responsible for carrying out the maintenance and construction of the system, in addition to operating in the energy supply market.

What needs to happen here is to transfer the grid (both transmission & distribution) to Eirgrid and sell energy producing assets and allow private companies compete in the domestic energy market on a level playing field. ESB (or Electric Ireland as that arm likes to be known these days) could retain a number of assets and compete in the market if they so wished (although I dont think a heavily unionised semi-state company would last long in a competitive market like this). This kind of Full Ownership Unbundling would create greater competition - it is as close to perfect competition as you can get because all competitors provide the exact same product (electricity) and would be using the same network which is owned and operated by an independant company (Eirgrid) and therefore they are competing on price alone. This would reduce energy costs for the consumer. The sale of Bord Gais Energy is a step in the right direction and will earn the country ~€1bn.

Also, according to the Frontier Economics report into the options for unbundling of transmission assets in the context of the EU Directive, Eirgrid suggest that ownership unbundling will lead to gross benefits of €80-90 million per year;

These benefits can be broken down into:
Efficiencies associated with single ownership and accountability - €21 million;
Outsourcing benefits - €15 million;
Reduced duplication of effort - €6 million;
Reduced project financing costs for developers - €7 million;
Lower constraints costs - €4 million and €6 million; and
from connecting renewable resources more quickly - €35 million

PRAF

Pete_Cavan wrote: »

Perhaps you could tell us when Ireland had "close to the cheapest industrial unit charge in Europe" because I am guessing it was in the 1960s and 70s, shortly after most of our power stations were built. Today ESBs assets are quickly becoming obsolete and will require major investment to upgrade. SSE is currently constructing a 460MW CCGT (combined cycle gas turbine) at Great Island, Co. Wexford, which is expected to be commissioned in 2014. They also have eceived full planning permission for a proposed 450MW CCGT plant at Tarbert, Co. Kerry and development sites at Lanesboro and Shannonbridge. I would be more confident of SSE and the future owner of Bord Gais Energy making further investments than ESB upgrading Moneypoint which can consume up to 7,000 tonnes of coal per day.

What we have now is not competition. Under Directive 2009/72/EC EU member states are required to separate transmission from generation and supply activities. Ireland currently does not comply with this because EirGrid is licensed to act as transmission system operator (TSO) and is responsible for the operation and development of the transmission grid while ESB still own the assets is responsible for carrying out the maintenance and construction of the system, in addition to operating in the energy supply market.

What needs to happen here is to transfer the grid (both transmission & distribution) to Eirgrid and sell energy producing assets and allow private companies compete in the domestic energy market on a level playing field. ESB (or Electric Ireland as that arm likes to be known these days) could retain a number of assets and compete in the market if they so wished (although I dont think a heavily unionised semi-state company would last long in a competitive market like this). This kind of Full Ownership Unbundling would create greater competition - it is as close to perfect competition as you can get because all competitors provide the exact same product (electricity) and would be using the same network which is owned and operated by an independant company (Eirgrid) and therefore they are competing on price alone. This would reduce energy costs for the consumer. The sale of Bord Gais Energy is a step in the right direction and will earn the country ~€1bn.

Also, according to the Frontier Economics report into the options for unbundling of transmission assets in the context of the EU Directive, Eirgrid suggest that ownership unbundling will lead to gross benefits of €80-90 million per year;

Makes a lot of sense on the face of it. Didn't Pat Rabitte rule this out though?

nesf

PRAF wrote: »

Makes a lot of sense on the face of it. Didn't Pat Rabitte rule this out though?

I don't remember if it was ruled out but I do remember that there was grumbling that it would make life very hard on the ESB if they went this route and took away the grid from them completely.

flutered

fly_agaric wrote: »

I thought I had read somewhere, some time ago (not much of a source) that the electricity price was being kept high by the regulator to try and stimulate competition to ESB, which would of course eventually bring down prices (seems mad to me but I suppose that's the logic people who view the world backwards through the binoculars of economics come up with which a simpleton like me could never understand!).

believe it or not, the esb applied earlier in the year for a 7% price increase, the regulator gave them 8.5%, my figures may be a little out not much tho.

Pete_Cavan

PRAF wrote: »

Makes a lot of sense on the face of it. Didn't Pat Rabitte rule this out though?

Originally the plan was to sell a 30% share in ESB but imo this is a terrible idea and thankfully this has since been dropped. Rabitte has ruled out "the break-up of the ESB" claiming the "Cahill-Frontier report recommended against that". Of course what Rabitte said here is totally untrue because the Frontier Report looked at the options available to Ireland under Directive 2009/72/EC and, unsurprisingly, the Directive says nothing about ESB. Rabitte seems to wish to continue with the status quo dispite that not being an option but it is easier for a Minister than tackling the ESB unions. It will most likely result in Ireland being hauled in front of the European Court for failure to comply with a Directive as has happened in the past. Rabitte will of course be gone by this time and the taxpayer will be left to pick up another bill when we should be reaping the benefits of fairer and more competitive energy market.

PRAF

Pete_Cavan wrote: »

Originally the plan was to sell a 30% share in ESB but imo this is a terrible idea and thankfully this has since been dropped. Rabitte has ruled out "the break-up of the ESB" claiming the "Cahill-Frontier report recommended against that". Of course what Rabitte said here is totally untrue because the Frontier Report looked at the options available to Ireland under Directive 2009/72/EC and, unsurprisingly, the Directive says nothing about ESB. Rabitte seems to wish to continue with the status quo dispite that not being an option but it is easier for a Minister than tackling the ESB unions. It will most likely result in Ireland being hauled in front of the European Court for failure to comply with a Directive as has happened in the past. Rabitte will of course be gone by this time and the taxpayer will be left to pick up another bill when we should be reaping the benefits of fairer and more competitive energy market.

This kind of thing gives the unions a bad name IMO. It is blatant self interest and you need a strong minister to stand up to them.

Macha

I'd be cautious about assuming that unbundling is going to automatically bring increased competition and lower prices. In the UK many of the large companies bypass the wholesale market and the generation arm of the company sells directly to the supply arm giving zero price transparency. The deregulation of prices will be needed to make sure any price reductions (or increases) are passed along to the final consumer.

Also, huge investments are needed in the energy sector over the coming years and these will have to be paid for, ultimately, by end users. At the moment, wholesale electricity prices in Europe are actually so low, there is very little investment happening in generation capacity.

The only technologies really being built out are renewables because of subsidies. Gas plant owners are crying out for capacity payments as their load factors decline and nuclear is never going to be built without state aid, hence the UK plans. Some coal plant plans are being revived because of cheap coal prices and the failure of the ETS to deliver a carbon price.

So in the short term, cheaper prices could occur with price deregulation but in the longer term, higher prices are inevitable due to investment needs.

The one thing that can really save us is efficiency. If it's inevitable that the unit price of energy, we need to make sure we're using as few units as possible. German households actually have a higher per unit price of electricity than Ireland but their bills are still lower because their houses are just far more efficient (even with much colder winters).

PRAF

Macha wrote: »

I'd be cautious about assuming that unbundling is going to automatically bring increased competition and lower prices. In the UK many of the large companies bypass the wholesale market and the generation arm of the company sells directly to the supply arm giving zero price transparency. The deregulation of prices will be needed to make sure any price reductions (or increases) are passed along to the final consumer.

Also, huge investments are needed in the energy sector over the coming years and these will have to be paid for, ultimately, by end users. At the moment, wholesale electricity prices in Europe are actually so low, there is very little investment happening in generation capacity.

The only technologies really being built out are renewables because of subsidies. Gas plant owners are crying out for capacity payments as their load factors decline and nuclear is never going to be built without state aid, hence the UK plans. Some coal plant plans are being revived because of cheap coal prices and the failure of the ETS to deliver a carbon price.

So in the short term, cheaper prices could occur with price deregulation but in the longer term, higher prices are inevitable due to investment needs.

The one thing that can really save us is efficiency. If it's inevitable that the unit price of energy, we need to make sure we're using as few units as possible. German households actually have a higher per unit price of electricity than Ireland but their bills are still lower because their houses are just far more efficient (even with much colder winters).

The Germans - annoyingly efficient, as always!

Why can't we just outsource our entire national infrastructure to them!

Macha

PRAF wrote: »

The Germans - annoyingly efficient, as always!

Why can't we just outsource our entire national infrastructure to them!

No objections from my side. And of course let's not forget Germany has committed to phasing out nuclear and really going for renewables. In case anyone thinks nuclear is a solution for high Irish energy prices, nuclear energy is by far the most expensive energy source you can possibly imagine. And that's not including all the freebies the industry enjoys.

Victor

Macha wrote: »

One of the big reasons our electricity prices can be so high is we generate a lot of our electricity from gas. Over 90% of that gas comes through the UK leaving us exposed to fluctuations in the exchange rate between euro & pound but also to dynamics in the UK gas market. If wholesale gas prices go up in the UK, they will also go up in Ireland.

While this may lead to fluctuations, it shouldn't lead toa huge differential. Gas can be bought in advance to hedge prices.

It's important not to forget the role of taxes in energy prices and of course how energy prices are more important for some sectors than others.

Indeed, in the case of Denmark, the very high taxes appear to suppress the base price, while it seem to be the opposite in the UK. However, it will depend on what proportion of the tax is VAT and what proportion is excise-type taxes.

Pete_Cavan wrote: »

Perhaps you could tell us when Ireland had "close to the cheapest industrial unit charge in Europe" because I am guessing it was in the 1960s and 70s, shortly after most of our power stations were built.

Actually it was in the 1990s. With Moneypoint built in 1984 and all the older stations still going, there was a huge amount of excess capacity and no perceived need for new generation capacity, so money was neither invested nor put aside for new capacity. The problems arose in the late 1990s with demand booming and the older power stations needing increased maintenance and replacement.

Today ESBs assets are quickly becoming obsolete and will require major investment to upgrade. SSE is currently constructing a 460MW CCGT (combined cycle gas turbine) at Great Island, Co. Wexford, which is expected to be commissioned in 2014. They also have eceived full planning permission for a proposed 450MW CCGT plant at Tarbert, Co. Kerry and development sites at Lanesboro and Shannonbridge. I would be more confident of SSE and the future owner of Bord Gais Energy making further investments than ESB upgrading Moneypoint which can consume up to 7,000 tonnes of coal per day.

There is actually quite a bit of diversity in the generation sector now.

http://en.wikipedia.org/wiki/List_of_power_stations_in_the_Republic_of_Ireland

The real problem at the moment is the transmission and distribution systems are becoming dated and need €2-3bn in investment (which is happening).

What needs to happen here is to transfer the grid (both transmission & distribution) to Eirgrid and sell energy producing assets and allow private companies compete in the domestic energy market on a level playing field. ESB (or Electric Ireland as that arm likes to be known these days) could retain a number of assets and compete in the market if they so wished (although I dont think a heavily unionised semi-state company would last long in a competitive market like this).

I do think the grid should go to EirGrid or other non-Electric Ireland entity and it should take certain generation capacity with it - in particular the hydro and pumped-hydro stations. That way, Electric Ireland can become just another generator / supplier.

The sale of Bord Gais Energy is a step in the right direction and will earn the country ~€1bn.

"Earn" is the wrong word. If you sell your house, you have just 'earned' the money.

nesf wrote: »

I don't remember if it was ruled out but I do remember that there was grumbling that it would make life very hard on the ESB if they went this route and took away the grid from them completely.

I'm not seeing the problem - a level playing pitch should be a level playing pitch.

Macha

Victor wrote: »

While this may lead to fluctuations, it shouldn't lead toa huge differential. Gas can be bought in advance to hedge prices.

And it normally is, plus the fact that gas is still largely oil-indexed in Europe. The fact remains we are still a price taker on gas.

I wonder if retail customers really want truly deregulated gas and electricity prices...everyone wants certainty.

Victor wrote: »

Indeed, in the case of Denmark, the very high taxes appear to suppress the base price, while it seem to be the opposite in the UK. However, it will depend on what proportion of the tax is VAT and what proportion is excise-type taxes.

True.

SeanW

nesf wrote: »

From The Economist: http://www.economist.com/blogs/graphicdetail/2013/05/daily-chart-4?fsrc=scn/fb/wl/dc/voltsforvolks

What is interesting to note is that if we applied Germany's tax rate to electricity we would be dramatically more expensive than even Cyprus which tops the table well above us currently. This raises interesting questions about why it is so expensive for us to produce one kW of electricity. Yes, definitely economies of scale come in here to some extent, but is it our fuel mix combined with a high wage base that really kills us here? I mean looking at that chart, are we really paying *that* much more in wages than the other countries in Europe or is not going the nuclear route *that* bad cost wise per unit?

Expensive electricity is both bad for business and bad for consumers, so really keeping the cost of electricity down should be a much bigger issue for Ireland than it is at present.

Germany has two main problems in its electricity supply.

1. The cost of electricity there is phenomenal. Among the highest in the world, if not the highest.
2. They're on a coal power plant building spree the likes of which are absolutely unprecedented in the first world. This can only spell catastrophe for human health and the viability of Nordic lakes and streams via acid rain.
3. Introduction of unstable, expensive power sources threatens the viability of that nations industrial sector, as they are far more sensitive in every possible respect to these issues.

All of these problems have one root cause - the environmental left. Germany and the problems therein are a textbook example of letting environmentalists anywhere near energy policy.

This madness is currently spreading all over Europe like a cancer, and in an Irish context contributes to the cost of electricity by means of the Public Service Obligation levy, which goes to subsidise wind farms, though here we are also subsidising peat fired power, which to me seems like madness.

Wind farms are filthy, they kill birds and bats en-masse, they're ugly, they and other renewables are unreliable and the small scale fluctations they introduce into power grid wreak havoc on industrial processes that rely on a continous (i.e. not even interrupted or alteration for even a fraction of a second) stable power supply. And they have to be subsidised like crazy.

And the environmental-left can't get enough of them :rolleyes: Unfortunately voices of sanity are few and far between.

Heroditas

SeanW wrote: »

they and other renewables are unreliable and the small scale fluctations they introduce into power grid wreak havoc on industrial processes that rely on a continous (i.e. not even interrupted or alteration for even a fraction of a second) stable power supply. And they have to be subsidised like crazy.

Sorry but that is just wrong. If you're referring to frequency fluctuations due to renewables on the system, that is all handled and dealt with - it does not affect industrial facilities.
Also, regarding the subsidies, the portion of the PSO used for renewables is a drop in the ocean when compared to capacity payments made to other generators, along with the rest of the PSO which is used to subsidise peat-burners and a handful of other generators.

Cody Pomeray

SeanW wrote: »

Wind farms are filthy

explain?

nesf

SeanW wrote: »

Germany has two main problems in its electricity supply.

1. The cost of electricity there is phenomenal. Among the highest in the world, if not the highest.
2. They're on a coal power plant building spree the likes of which are absolutely unprecedented in the first world. This can only spell catastrophe for human health and the viability of Nordic lakes and streams via acid rain.
3. Introduction of unstable, expensive power sources threatens the viability of that nations industrial sector, as they are far more sensitive in every possible respect to these issues.

All of these problems have one root cause - the environmental left. Germany and the problems therein are a textbook example of letting environmentalists anywhere near energy policy.

This madness is currently spreading all over Europe like a cancer, and in an Irish context contributes to the cost of electricity by means of the Public Service Obligation levy, which goes to subsidise wind farms, though here we are also subsidising peat fired power, which to me seems like madness.

Wind farms are filthy, they kill birds and bats en-masse, they're ugly, they and other renewables are unreliable and the small scale fluctations they introduce into power grid wreak havoc on industrial processes that rely on a continous (i.e. not even interrupted or alteration for even a fraction of a second) stable power supply. And they have to be subsidised like crazy.

And the environmental-left can't get enough of them :rolleyes: Unfortunately voices of sanity are few and far between.

You're saying the environmental left are behind a coal plant building spree?

Macha

nesf wrote: »

You're saying the environmental left are behind a coal plant building spree?

The argument is that Germany is building these plants to compensate for nuclear plant shutdowns. The reality is many of these coal plants were planned long before the nuclear phaseout, or energiewende, was announced.

Recent increases is coal generation (as opposed to capacity) in Germany are a result of lower coal prices in Europe and a non-existent carbon price as delivered by the ETS. In fact, Germany is currently a net electricity exporter, demonstrating that coal generation is being ramped up for economic purposes and not to meet German demand. More data here:

http://www.ise.fraunhofer.de/en/downloads-englisch/pdf-files-englisch/news/electricity-production-from-solar-and-wind-in-germany-in-2013.pdf

Edit: Actually here's a graph showing renewables are covering lower nuclear output and gas is being replaced with coal, as you would expect with higher clean dark spreads than clean spark spreads:

Ah, way too big. Viewable here: http://www.unendlich-viel-energie.de/uploads/media/AEE_ersetzen_Atomstrom_en.jpg

Victor

SeanW wrote: »

[*]They're on a coal power plant building spree the likes of which are absolutely unprecedented in the first world. This can only spell catastrophe for human health and the viability of Nordic lakes and streams via acid rain.

The technology has massively improved.

This madness is currently spreading all over Europe like a cancer, and in an Irish context contributes to the cost of electricity by means of the Public Service Obligation levy, which goes to subsidise wind farms, though here we are also subsidising peat fired power, which to me seems like madness.

No. Given the high price of oil/gas, there is no need to subisdise peat.

Wind farms are filthy, they kill birds and bats en-masse,

But other types of generation also kill wildlife - see Scandanavian and Canadian lakes and forests.

they and other renewables are unreliable

What is wrong with thermal, hydro or bio-fuels?

Dob74

nesf wrote: »

From The Economist: http://www.economist.com/blogs/graphicdetail/2013/05/daily-chart-4?fsrc=scn/fb/wl/dc/voltsforvolks

What is interesting to note is that if we applied Germany's tax rate to electricity we would be dramatically more expensive than even Cyprus which tops the table well above us currently. This raises interesting questions about why it is so expensive for us to produce one kW of electricity. Yes, definitely economies of scale come in here to some extent, but is it our fuel mix combined with a high wage base that really kills us here? I mean looking at that chart, are we really paying *that* much more in wages than the other countries in Europe or is not going the nuclear route *that* bad cost wise per unit?

Expensive electricity is both bad for business and bad for consumers, so really keeping the cost of electricity down should be a much bigger issue for Ireland than it is at present.

Why is electricity so expensive hear?

1. Nuclear
2. Wind Power works fine when the wind is blowing at the right speed. But you need to back it up with quick fire power plants, Gas, nuclear or hydro.
Gas is our only option at the moment. It's expensive and we are the end of along pipeline. An interconnector to France is the only way to get cheap Nuclear. No sign of this happening.
3. We let the energy companies rip us off. Why wont the regulator make them keep there prices the same like nearly every other company has in this recession. ESB and Bord Gais are still making profits. It would be no harm for them to be breaking even or make a loss. Why should the consumer have to bail them out. They awarded there staff a pay rise, since the economic collaspe.

Heroditas

Dob74 wrote: »

3. We let the energy companies rip us off. Why wont the regulator make them keep there prices the same like nearly every other company has in this recession. ESB and Bord Gais are still making profits. It would be no harm for them to be breaking even or make a loss. Why should the consumer have to bail them out. They awarded there staff a pay rise, since the economic collaspe.

So Electric Ireland and Bord Gais should be allowed undercut the likes of Airtricity and be subsidised by the government?
Gas prices have shot up in the last few yeas, hence the price of electricity has rise. It's as simple as that.
Also, power companies issue bonds to refinance the business. Conditions attached to those bonds would concern certain profitability targets being met.
The consumer is not "bailing out" the state owned power companies. They are run as businesses and they return money to the exchequer in the form of dividends.

SeanW

Heroditas wrote: »

Sorry but that is just wrong. If you're referring to frequency fluctuations due to renewables on the system, that is all handled and dealt with - it does not affect industrial facilities.

WADR, it is this that is flat out wrong. Industrial processes are often sensitive to the most minor fluctuations in the power grid, and renewables (solar and wind) introduce fluctuations like crazy, in Germany it has lead to widespread industrial damage, ranging from €10,000 to hundreds of thousands per incident, i.e. per factory per fluctuation.
http://www.spiegel.de/international/germany/instability-in-power-grid-comes-at-high-cost-for-german-industry-a-850419.html

Cody Pomeray wrote: »

explain?

Renewables, such as solar and wind, have been behind a large scale expansion in the mining of "rare earth" metals, such as Neodymium. Problem is that the only country willing to trash its environment as needed to suply the Neodymium for bone headed Western renewables programmes is China.
http://www.dailymail.co.uk/home/moslive/article-1350811/In-China-true-cost-Britains-clean-green-wind-power-experiment-Pollution-disastrous-scale.html

nesf wrote: »

You're saying the environmental left are behind a coal plant building spree?

It has been proven throughout history that one makes the choice either to use fossil fuels or nuclear power, for a considerable portion of a nations power supply. We made our choice back in the '70s thanks to the hippies at Carnsore Point, which is why we now have Moneypoint power station and are almost totally reliant on fossil fuels. Same thing that's happening in Germany.

France on the other hand made the opposite choice - they went hell for leather down the nuclear road and as a result, their energy supply is 90+% non fossil. Something the environmental left doesn't like to talk about.

Victor wrote: »

But other types of generation also kill wildlife - see Scandanavian and Canadian lakes and forests.

I'm quite familiar with the side effects of using coal power (it produces SO2 and NOX that cause acid rain) and I am implacably opposed to it. That's why I favour nuclear: as a drop-in replacement for coal fire power. Something I doubt faffing about with windmills or solar panels will ever do.

What is wrong with thermal, hydro or bio-fuels?

With the exception of Iceland and parts of Scandinavia, geothermal and hydro cannot scale up to the levels required. As for bio-fuels, growing these uses the most precious resource we have: land. Land is used for residences, recreation, commerce, forestry, growing all different sorts of crops, raising livestock and also nature reserves. These are all competing uses for a commodity we cannot make more of.

To illustrate the problem I have with biofuels for electricity generation, consider a binary choice, that, hypothetically speaking, a government might choose to generate 125MW from a new power plant: but it could be either a Pebble Bed nuclear power plant, or a biofuel pp. Considering, for a moment, that the main consideration is land use, go down the biofuels route and you have to press X,000 acres of land into bioenergy crop production. Go down the nuclear route and you could leave that land to a nature reserve.

In that scenario, it would take me about 2 seconds to suggest what to do.

Heroditas

Fluctuations like that can happen even with a grid powered solely with fossil fuelled plants. It has little to do with the amount of renewables on the grid.
What that article indicates is that Germany has an issue balancing its grid and needs to invest in dong so.
That does not happen in Ireland.

SeanW

Heroditas wrote: »

What that article indicates is that Germany has an issue balancing its grid and needs to invest in dong so.
That does not happen in Ireland.

"An issue" that wasn't an issue before they started decommissioning nukes and building windmills ... gee I wonder why?

Thank goodness, it's not happening in Ireland yet.
How long do you think Intel would stick around if it was losing wafers of silicon by the truckload through power supply interruptions? Or what remains of the rest of our industrial base?

hfallada

A man who was fairly high up in the ESB said that the prices are artificially high to get competition into the market. This true as ESB cant have more than 60% of the electricity market. Also ESB generates a majority its electricity from Gas which is extremely expensive in Europe and there was an article in the economist saying Coal is far cheap to use. However Coal is very dirty and produces twice as much Co2 as coal.

It doesnt happy either that ESB staff get twice the industry wage.

Cody Pomeray

SeanW wrote: »

Renewables, such as solar and wind, have been behind a large scale expansion in the mining of "rare earth" metals, such as Neodymium.

As your own Daily Mail article points out, "rare" does not simply refer to the element's abundance in the environment.

It's also interesting that the article you posted included the diagram I have reproduced below, which shows wind to have a lower carbon footprint than any fossil fuel based system, and its footprint is comparable or lower than the non-fossil power generation technologies.



Similar positive findings have been found in relation to toxicity [Vestas wind systems A/S. Life cycle assessment of offshore and onshore sited wind power plants based on Vestas V90-3.0 MW turbines http://www.vestas.com/Files/Filer/EN/Sustainability/LCA/LCAV90_juni_2006.pdf]

o presumably your only concern relates to heavy metals and mining activity.

I have searched extensively, and have been unable to find any scientific evidence for the extent and magnitude of damage caused by the mining of Nd on soil.

Since you have raised this issue as being "filthy" in the context of this debate, I assume you mean it is filthier than the fossil fuel and non-fossil alternatives? In which case, you must have some some reason to have arrived at that understanding, which you might share.

Heroditas

SeanW wrote: »

Thank goodness, it's not happening yet.
How long do you think Intel would stick around if it was losing wafers of silicon by the truckload through power supply interruptions? Or what remains of the rest of our industrial base.

The likes of Intel have back-up emergency generators that are synchronised with the grid in the event of power failures.
Also, the grid has enough back-up that can kick in instantly in the event of a generator or wind farm dropping off suddenly.
That's my point - the grid is balanced correctly here, hence why we don't have the issues that Germany has. That'll still be the case even if more renewables are placed in the generation mix.

Heroditas

hfallada wrote: »

A man who was fairly high up in the ESB said that the prices are artificially high to get competition into the market. This true as ESB cant have more than 60% of the electricity market. Also ESB generates a majority its electricity from Gas which is extremely expensive in Europe and there was an article in the economist saying Coal is far cheap to use. However Coal is very dirty and produces twice as much Co2 as coal.

It doesnt happy either that ESB staff get twice the industry wage.

That statement is no longer true because the market is now fully deregulated.
Coal is currently very cheap and due to the collapse in the ETS market, it is much cheaper to generate electricity here using coal than with gas, also due to the sharp increases recently in gas prices.
However, coal plants are not as flexible as gas plants, hence why gas plants make up the majority of the generatin mix here.

SeanW

Heroditas wrote: »

The likes of Intel have back-up emergency generators that are synchronised with the grid in the event of power failures.
Also, the grid has enough back-up that can kick in instantly in the event of a generator or wind farm dropping off suddenly.
That's my point - the grid is balanced correctly here, hence why we don't have the issues that Germany has. That'll still be the case even if more renewables are placed in the generation mix.

It only takes a millisecond or two ...

Heroditas

SeanW wrote: »

It only takes a millisecond or two ...

Hence why back-up generators are synchronised.

Victor

Dob74 wrote: »

3. We let the energy companies rip us off. Why wont the regulator make them keep there prices the same like nearly every other company has in this recession.

The cost of fuels have gone up hugely.

ESB and Bord Gais are still making profits. It would be no harm for them to be breaking even or make a loss. Why should the consumer have to bail them out.

The consumer can't afford for them to be making a loss. Making a loss would mean there would be no investment. No investment on a dilapidated system means no investment by big business, which means no economic recovery.

They awarded there staff a pay rise, since the economic collaspe.

There has also been restructuring.

oppenheimer1

Macha wrote: »

No objections from my side. And of course let's not forget Germany has committed to phasing out nuclear and really going for renewables. In case anyone thinks nuclear is a solution for high Irish energy prices, nuclear energy is by far the most expensive energy source you can possibly imagine. And that's not including all the freebies the industry enjoys.

The removal of nuclear from the energy mix in Germany is a huge mistake. Without nuclear, what is going to produce the electrical energy baseload?

Or what happens when a high pressure system settles itself on central Europe for two to three weeks?

AlmightyCushion

oppenheimer1 wrote: »

The removal of nuclear from the energy mix in Germany is a huge mistake. Without nuclear, what is going to produce the electrical energy baseload?

Or what happens when a high pressure system settles itself on central Europe for two to three weeks?

They're building a load of coal plants as well.

Macha

oppenheimer1 wrote: »

The removal of nuclear from the energy mix in Germany is a huge mistake. Without nuclear, what is going to produce the electrical energy baseload?

Or what happens when a high pressure system settles itself on central Europe for two to three weeks?

What makes you think we need baseload? There are plenty of ways of balancing renewables in the grid that don't involve any baseload, including new market designs for better flexibility, expanded diversity of resources within a geographic grid, coordination of balancing areas, fostering balancing response times through market mechanisms, system optimization, power dispatch models that incorporate day-ahead markets, yes some controlled curtailment of renewables, demand side management, storage, flexible balancing generation like CCGT, etc.

Modelling of extreme weather conditions even for extended periods of time has demonstrated that it isn't an issue. What is not understood is that it is nuclear's lack of flexibility that can cause problems in the network - not to mention the impact that a large nuclear plant has on competition in the electricity market.

AlmightyCushion wrote: »

They're building a load of coal plants as well.

As I explained in an earlier post in this thread, these coal plants were announced before the nuclear phase out. Germany is currently a net electricity exporter, demonstrating it has more than sufficient generation capacity.. These coal plants are being built for commercial purposes.

SeanW

Macha wrote: »

Modelling of extreme weather conditions even for extended periods of time has demonstrated that it isn't an issue.

Great, so when you have another Siberian anti-cyclone like what we had at Christmas 2010 (punishingly low temperatures, no sun, no wind, everything frozen, but lots of people needing to throw on everything electric to stay alive) there would be no problem even if the grid was hopelessly dependent on (stalled) windmills, (frozen) pumped hydro pools and (iced over) solar panels ...

What is not understood is that it is nuclear's lack of flexibility that can cause problems in the network - not to mention the impact that a large nuclear plant has on competition in the electricity market.

Your promoting technologies thare are not only unreliable and unstable, but that have subsidised to ridiculous extremes, and at the same time bashing nuclear for being "inflexible" and having an impact on competition? No offense, but to take that serioulsy really requires the suspension of disbelief.

As I explained in an earlier post in this thread, these coal plants were announced before the nuclear phase out. Germany is currently a net electricity exporter, demonstrating it has more than sufficient generation capacity.. These coal plants are being built for commercial purposes.

The environmental left had been pushing for a nuclear phase out for a long time and all these policies have been in place for many years.
Given that:

1. Nuclear power is being phased out (a key demand of Green parties, Greenpeace etc) AND:
2. Renewables are being subsidised to the hilt

It is safe to say that the environmental-left (i.e. people like you) are calling the shots on German energy policy. Yet these coal plants have backing from the highest levels of the German government, which as I said is being told what to do by the environmental-left.


So you can't blame "commercial purposes" when its your side that is laying down policy and calling the shots.



Much the same as how Moneypoint was built only after the plans for Carnsore Point were scuppered by the environmental left ... Moneypoint and a lot of the fossil fuel usage since those days can correctly be attributed to the environmental-left.

Heroditas

SeanW wrote: »

Great, so when you have another Siberian anti-cyclone like what we had at Christmas 2010 (punishingly low temperatures, no sun, no wind, everything frozen, but lots of people needing to throw on everything electric to stay alive) there would be no problem even if the grid was hopelessly dependent on (stalled) windmills, (frozen) pumped hydro pools and (iced over) solar panels ...

.

Yeah but Macha hasn't said any such thing. He's mentioned flexibility including using CCGT.

SeanW

Heroditas wrote: »

Yeah but Macha hasn't said any such thing. He's mentioned flexibility including using CCGT.

You'd need a very large amount of CCGT if that's the backup plan. A VERY large amount.

Macha

SeanW wrote: »

Great, so when you have another Siberian anti-cyclone like what we had at Christmas 2010 (punishingly low temperatures, no sun, no wind, everything frozen, but lots of people needing to throw on everything electric to stay alive) there would be no problem even if the grid was hopelessly dependent on (stalled) windmills, (frozen) pumped hydro pools and (iced over) solar panels ...

You'll need to provide some a credible study to prove that demand couldn't be met with the system I described. So far, all you've done is claim it.

SeanW wrote: »

Your promoting technologies thare are not only unreliable and unstable, but that have subsidised to ridiculous extremes, and at the same time bashing nuclear for being "inflexible" and having an impact on competition? No offense, but to take that serioulsy really requires the suspension of disbelief.

In Q4 2010 there were unplanned outages of nuclear plants. Why don't you also mention them in your post? All energy technologies have an element of instability in them and you haven't offered any evidence that renewables cannot be fully integrated into an electricity grid.

As for subsidies, the nuclear industry is a mature industry yet is incapable of existing without state aid. In Germany alone between 1950 and 2008, nuclear received subsidies of more than (2008)€167 billion. That doesn't include future decommissioning costs, future waste disposal costs or insurance risk borne by the state.

On the other hand, many renewable energy technologies (because we are talking about about 10) have reached varying levels of maturity. Of course as they mature, they should be more exposed to market signals but some are still infant technologies and need support to reach the market. But the idea that renewables should be criticized because they receive subsidies ignores the history of subsidies to other technologies, legacy market rules and existing infrastructure that all favours incumbents. The level playing field many want renewables to compete on just doesn't exist.

If you're going to decide on energy technology on the basis of subsidies, it makes no sense to support nuclear.

SeanW wrote: »

It is safe to say that the environmental-left (i.e. people like you) are calling the shots on German energy policy. Yet these coal plants have backing from the highest levels of the German government, which as I said is being told what to do by the environmental-left.

So you can't blame "commercial purposes" when its your side that is laying down policy and calling the shots.

I'd like to know of any high-level backing of these projects since the announcement of the nuclear phase out. The reality on the ground is very different. This graph (in German) shows that since the announcement of the nuclear phase out, two German coal plants have gone into production and there are 8 under construction. The two plants that have just gone online received their permits in 2005. The other 8 projects were all underway by 2009 at the latest. Go further down the document and you'll see that 6 coal plant projects have actually been abandoned.

In summary, since announcing the nuclear phaseout, Germany has announced no new coal plant projects and has actually stepped away from 6 coal plant projects.

I might also add that Merkel has voiced her support for the backloading proposal of the EU Emissions Trading System, which would bring up the carbon price. The main function of a strong ETS price is a switch from coal to gas. So I'm not sure how you can claim the current German government is strongly supporting coal.

Macha

Heroditas wrote: »

Yeah but Macha hasn't said any such thing. He's mentioned flexibility including using CCGT.

She (:)), but thanks and you're right. I'm talking about a very different system that would involve a mix of measures. Even the idea that we would need huge amounts of storage is no longer supported by many energy system models.

Heroditas

Macha wrote: »

She (:)), but thanks and you're right. I'm talking about a very different system that would involve a mix of measures. Even the idea that we would need huge amounts of storage is no longer supported by many energy system models.

The idea of large-scale storage was always far-fetched. Far too expensive and poor use of resources when, as you've already pointed out, a mix of measures can be highly effective.

Heroditas

SeanW wrote: »

You'd need a very large amount of CCGT if that's the backup plan. A VERY large amount.

It already exists here.