Thursday, March 5, 2015

Offshore Wind - Evidently, Mostly a Euro Thing….


Picture from http://www.offshorewind.biz/wp-content/uploads/2014/12/Nordsee-Ost-Wind-Turbines-Installed-3.jpg of an RE Power (now Senvion) 6.15 MW wind turbine, one of 48. This array (Nordsee Ost) recently became operational in the North Sea off of the northwest coast of Germany..

As of the end of 2014, the worldwide wind turbine capacity stood at 370 GW (http://www.wwindea.org/new-record-in-worldwide-wind-installations/), and this is roughly a $US 600 billion investment. Of this, 114 GW  has taken place in China (where installed turbines are much less expensive than in the rest of the world, are essentially only Chinese made, but at a cost…..), but the reasons why this has happened in China are quite often VERY different than why wind turbines are installed  in most other places. On average this 370 GW of wind turbine capacity will supply over 75 to near 100 GW of electricity. In other words, these turbines have prevented another 75 to 100 incidences of massive stupidity (new nukes) that would endanger so many for the benefit of so few. You’re welcome, world…..

A small but growing subset is offshore wind turbine installations - almost 9 GW (2.4% of the total) are now operational, though this represents around $US 40 billion worth of investments (about 7% of the total). Of these, only China (565 MW) and Japan (~ 20 MW) have offshore turbines installed outside of Europe - the remainder have been installed in Europe, mostly England, Germany, Denmark, Belgium, the Netherlands and Sweden, though France also has a huge ramp-up in the works. A really good report on Europe’s efforts can be found here: http://www.ewea.org/fileadmin/files/library/publications/statistics/EWEA-European-Offshore-Statistics-2014.pdf. As of the end of 2014, operating capacity in Europe was 8045 MW which should produce 29.6 TW-hr/yr, or averaging 42 % of rated capacity (about 3.7 GW. Offshore wind capacity is around 7% of Europe’s wind turbine capacity and roughly 13% of the average electrical output, so offshore wind is a much bigger deal than in anywhere else in the world.

The average offshore wind turbine size installed last year was 3.7 MW (roughly twice what the average onshore capacity per turbine was in the US last year). The commercialization of a new generation of “big boys” (6 to 8 MW) has now begun, with blade rotor diameters of 150 to 164 meters. Without a doubt, Europe (especially Denmark, Germany, Spain, Belgium France and the Netherlands) is where the technology to both make and install offshore wind turbines resides. China’s offshore wind efforts (they have 6 MW experimental units installed) to date have not produced the same results (operational quality) as has been done in Europe, and offshore wind is expensive, no matter where it is installed - in China or Europe. The same applies to Korea and Japan, where land area to install wind turbines is at a premium.

In the US (which could easily supply all of our electricity many times over with offshore wind, especially in the Great Lakes and on the East/Gulf coast), it appears that we will get our first offshore array in Rhode Island. The 30 MW Block Island project (5 x 6 MW Alstom (France) Halaide turbines designed for “moderate offshore winds”) just closed on its financing. As for the Cape Wind project… who knows? The US east coast is a great place to do this - shallow water, expensive electricity, decent winds and over 100 million people near it, but offshore wind has to compete with onshore wind, coal, old nukes and methane that is (for now) sold for below the cost to actually extract it from the ground. Furthermore, few politicians seem to have the courage to point out that offshore wind could be such a massive job creation exercise as well as a way to provide a huge part of the US East Coast electricty - especially in conjunction with pumped hydro systems installed in the nearby mountains (Appalachians, etc). Just the mere fact that turbines might actually be seen by rich people in their boats or hanging out at their coastal vacation homes/palaces is actually all that is now needed to kill off any offshore wind prospects. So despite our known need to switch to affordable and dependable renewables and to quit doing CO2 pollution as a by-product of electricity generation, well, it looks like offshore wind in the US is just going to be a curiosity for some time. And if it is ever done, it will be a great way to boost employment - in Europe. And also a great way to export dollars to Europe in return for imported parts, technology and installation systems. There will be no US leadership or even significant contribution in offshore wind. ESPECIALLY in NY State, where it probably has the greatest potential benefit….

As to why Europe is such a happening place for offshore wind - well, in essence, it really is all about job creation. There are also additional motivating factors, such as the need to limit the export of dollars for the import of fossil fuels like methane from Russia, Libya, Qatar/Iran and Algeria, the need to replace obsolete nukes which are not going to get replaced with newer nukes and the fact that the best winds in Europe are blowing across the Atlantic, Baltic Sea and Mediterranean Seas. With over 100 GW now installed onshore in Europe, some countries (notably Germany) are running out of room for new turbines. Germany has also installed more PV than any other country, despite having truly pathetic PV resources (in general, PV average outputs in Germany are less than 9% of PV rated capacity, though the nationwide average is 10.5% - http://en.wikipedia.org/wiki/Solar_power_in_Germany). And since NO renewable electricity in Germany is subsidized via tax avoidance or grants, such projects have to make money (i.e. deliver electricity at a production cost less than the Feed-In Tariff price) or else they lose money. One of the reasons electricity prices are as high as they are in Germany is due to the huge PV investment (38.3 GW of capacity) of over $US 170 billion that has to be paid off while it only makes a yearly average of 4 GW of electricity. Between 4 to 6 times more electricity could have been delivered if that same investment had been done with wind turbines. In addition, PV now provides very few manufacturing jobs (dumping of product from China has pretty much exterminated the European PV industry) - in the initial years (2000-2010), most PV products were made in Europe. But “competing” with slaves is a tough act, and when installers insist on the cheapest product no matter what - well, no manufacturing jobs in PV in Europe is the result.

But China cannot supply the components or the products, let alone design them, at the price and quality needed for offshore wind in Europe, despite numerous attempts. So when a European offshore wind array is installed, this is a massive European job creation effort come to fruition. Many of the proposed offshore wind build-out scenarios have between 100,000 to 300,000 new jobs created in this effort. So far, there are ”only” 2.9 GW of future projects under construction, but in the last couple of weeks, another 1 GW of projects has been announced in the UK. Scotland is getting quite peeved at the slow pace of installs in the UK (which has more offshore wind/electricity made than any other country at 4.5 GW) - just the Scottish offshore winds alone could easily power up all of the UK.

What is actually being discovered is that the winds near Europe’s land are fast and steady, and unlike PV, an extremely consistent output tends to result from a combination of several of these widely dispersed geographically (Finland to Scotland to Spain). These turbines tend to act more like those proverbial “base load” generation systems, supplying at least some electricity more than 85% of the time, and often producing at a steady rate for weeks at a time during the windy season (October to April). This is a dagger stuck into the heart of the nuke industry if there ever was one which could doom that vampiric entity…..…. And combine the huge supply of new projects on the drawing board and under way with the new grid infrastructure (Germany, the Netherlands, UK, Belgium and Ireland are installing HVDC lines under the North Sea to eventually store and retrieve power in Norway and Sweden), this means that energy storage can be mated to offshore wind energy production. With that, who needs nukes? And what Europe probably needs more now than electricity is manufacturing and installation jobs. Offshore wind is a set of prodigious job creation systems - notably to make the turbines, installation ships, offshore substations, HVDC converters and the foundations, plus all the stuff that goes in to making those things. And the coup de grace - long term investors who are looking for a stable home for tens of billions of Euros/Dollars/Pounds really seem to like offshore wind, as do the bankers who collect fees for arranging such financing. Last year two more Euro 1 billion deals got arranged, along with numerous smaller ones financing component plants. It sure beats negative interest rates, and while there may be year to year variation in wind speeds, what is not questioned is that there will be more than enough wind to power up Europe blowing across the Atlantic, Baltic and Mediterranean for as long as humanity will exist.

As for the US, we also have a prodigious onshore wind resource - high quality wind on a massive scale that is at least 20 times the present electricity consumption level. And nearby Canada has at least this, too - so over 40 times what the US now consumes for electricity could be made only using high quality wind resources and fast speed wind land based wind turbines in the US and Canada. But meld that with Low Wind Speed Turbine turbines, and in general, why bother with offshore. Except for a few instances (NY City/Long Island, Boston, Philadelphia, New Jersey, Washington DC/Baltimore/Maryland/Virginia), offshore wind is redundant, or at best it just provides quality winds/electricity from those winds at high demand times. In this country, the idea that government energy policy should provide massive economic stimulus/job creation (except for pollution based approaches, like offshore oil and gas, fracking for oil and methane) has somehow been trashed, especially by those living large on THEIR SUBSIDIES and avoided external costs. And that is the core problem with respect to offshore wind power in the US at the present time.

So, if you want to know when the US will finally get a decent offshore wind effort going, the answer appears to be when this country once again gets serious about industrial jobs as wealth creation for the bulk of its people as well as for the nation at large. We really don’t have that as a policy with the exception of fracking. But ever since that financial bubble/fraudfest got popped when oil prices dropped for $100/bbl to near $50/bbl, even that has been extinguished. Now all we have is automobile and truck manufacture, but that is a stagnant industry. Offshore wind is a massive user of steel and skilled metalworking, aluminum (wiring), but we just aren’t that into those kinds of things anymore. Too bad….

About that turbine in the picture - check this out:

So next time you hear Gov. Cuomo heaving a mighty pitch to the nearby media access devices about an offshore wind farm off of Long Island, ask yourself this question, do you think he really cares about creating jobs in the metal working/manufacturing sector? Or would he rather be raising money with his bankster and hedge fund buddies, trying to figure out new ways to extract money from the public school system into their waiting arms? Would he risk the wrath of rich people who don’t want to see such things as they yacht around in the Atlantic near Long Island? Especially if this becomes an exercise in taking money away from the natural gas industry….?

Tuesday, February 10, 2015

Despite it All, A Very Impressive 2014 for the Wind Biz



Ice buildup on turbine blades can be a show stopper, a pain, a problem to be solved, or just another problem solved. Lots of companies have ways to deal with ice buildup in winter weather. This picture is of a project where a de-icing system was tested out in 2012-2013 in Quebec, where winter is not a wimpy affair, By now its commercially available, and just one of many evolutionary improvements with a revolutionary potential. Such as North America and Europe mostly powered for their electricity supply via the breezes. After all, Denmark got 39% of their electricity from wind last year (http://en.wikipedia.org/wiki/Wind_power_in_Denmark), while Iowa did over 27%, and that should be bumped up to near 40% by the 2015. In the case of Iowa, that’s less than than 4% of their rated wind energy capacity - way less.

While the average American would never know it, there are still about 73,000 people employed in the wind sourced electricity business. The industry has survived several attempts to snuff it out in recent years - both direct attacks as well as via the consequence of perverse and all pervasive fraud in the North American methane business - in some ways the wind industry is the proverbial luckiest cat that ever was, perhaps with more than 9 lives. Last year almost 5 GW (4.854 GW to be exact) was installed - worth around $10 billion - and at the end of 2014, another $10 billion of new business was signed up with only 2 weeks of a window at the very end of the year via the PTC incentive ”extension". Right now, about $26 billion worth of wind farms are slated to be installed and spinning out renewable electricity by the end of 2016, a year which may prove ominous for renewable energy advocates…. (http://www.awea.org/MediaCenter/pressrelease.aspx?ItemNumber=7181).

Some trivia: in 2012, over $25 billion in business was done mostly installing  new wind farms and manufacturing wind turbines. Since most of the major turbine companies in the US are foreign owned (and is GE really even definable as an American corporation anymore - multinational fits them better), the 12.8 GW worth of installs that year mostly could have been imported as was the case a few years before that. But instead over 70% of all components and final products were made in the USA, and the plague of Chinese/Vietnamese/Korean towers (made possible by dumping) was finally stopped. China’s vaunted prowess in manufacturing was made meaningless not through tariffs but by quality (made in China turbines are notorious for crap grade quality via psuedo-slave labor (though those turbines are low priced), though that may eventually change. Meanwhile, European and North American turbines are proving to generally be quality investments - after all, a cheap turbine that does not work is pretty much a waste of money. But in China, the purpose of making and installing turbines is to employ people and consume steel, concrete and other manufactured goods (China’s massive wind turbine demand is essentially closed to non-Chinese companies and especially imports) and not necessarily to produce electricity. But in most of the rest of the world, the installed turbines are supposed to produce electricity and thus money to pay back the investment, and that may be the defining difference between China and the rest of the world in the renewable energy business. For example, even though China now has around 118 GW of installed capacity, the US with its 65 GW of installed capacity actually produces more electricity from its wind turbines than does Chia with its wind turbines.

But with the demise of the PTC incentive, which is the lesser important tax avoidance subsidy but which helps to provide about 2.8 c/kw-hr worth of incentive over 20 years, installs in 2013 dropped to about $3 billion worth of stuff. Aren’t the Republican’s supposed to be all about business, and if you can stand listening to their relentless propaganda, all about jobs (as in Keystone XL tar sands sludge pipeline)? Yeah, right… What other industry is allowed to drop OVER $22 billion/yr in business with awesome growth potentials, especially one which increases our economic and energy independence (wind displaces imports of methane from our petrocracy neighbor to the north, Canada - see http://www.eia.gov/dnav/ng/hist/n9102cn2A.htm - which are still amounting to around $6 billion a year? If you can think of one, please tell the world. Of course, when the GOP acronym could also stand for “Grand Oil Party” and methane (”natural” gas, not that nitrogen, argon and neon also don’t qualify for that term, and that oxygen is just as ”natural” as is methane (both of biological origin on this planet) is now more and more a part of the future of what remains of the “oil biz” in North America, well, priorities do get set. The GOP is totally in bed with the oil clique (to be honest, so are a lot of Democrats and “Independents”), and they don’t like it when rip-off profits that the oil biz thought were their right from methane don’t materialize because wind sourced electricity is keeping methane prices lower than would be the case if there was no wind sourced electricity. For every $1 per thousand standard cubic feet of methane price change, well, that’s around $25 billion a year that would otherwise be extracted from American consumers (residential, businesses, governments) or avoided money extraction from those same consumers. The 65 GW installed of wind capacity should average around 20.8 GW of electricity, which translates into 1.54 trillion standard cubic feet/yr of avoided methane consumption (based on 2013 electricity production of 19.18 GW average from US wind turbines), which is around 6% of ALL methane consumed in the US for 2014. By avoiding that need to consume that much methane, prices are likely half of what they otherwise would be (though the exact “what if?” calculation is always a bit speculative). Given present prices for methane (which by and large are now UNRELATED to the cost to produce that methane) are $3/kcf, that’s a cool $78 billion is avoided money extraction to the “oil and gas biz”. Source = http://www.eia.gov/renewable/data.cfm#wind

You’re welcome, America. Then multiply that by about 2 for it’s true economic immediate effect and this is around $150 billion a year that is not siphoned out of people/company/government expenditures, and is instead spent on something else. And for that trivial subsidy that amounts to 2.8 c/kw-hr for 20 years, well, it’s around $5 billion a year that goes mostly to really, really rich people via the taxes they would otherwise pay. 

And that too seems to be so totally Republican - helping rich people and the corporations they own/control NOT pay taxes and thus divert money that would otherwise likely have some portion of that money spent on - GAK! - poor people. But it’s only around $5 billion/yr, chump change in the big scheme of things, and besides, there is that gaping hole in the balance sheets of methane extraction companies (and now the banks and rich investors in those methane extraction schemes that were pushing what are now very fraudulent investments). Of the $500 billion in oil and gas junk bonds that are now in danger of going belly up, a big portion were partly or mostly methane based. But since the price needed to make those investments pay off is not happening for either methane OR crude oil, there is much anger in the oil patch, and the Republicans do feel that pain. That $78 billion/yr (or more) which could have been made and sent to (mostly) Republican owned franchise like Texas but will not be made because wind turbines have sand-bagged methane spot prices will mean that someone has to pay….. At this point, it seems like mostly vengeance. And the lesson - don’t put all your chips on something with such an ephemeral price as methane spot prices…. well, this is a crew that does like to teach lessons but does not like to learn them..

And every year that 1.54 trillion cubic feet/yr of methane consumption is avoided also means that around 34 megatons of CO2 pollution is avoided for that year. Oh, and with a 5% or so leakage rate, that’s around 1 megaton of methane pollution avoided, which has a similar greenhouse gas effect as all that CO2 pollution made when the methane was burned. And yes, you are welcome, oceanic coastal dwellers of America. And while that is a drop in the proverbial bucket (US CO2 pollution is around 6,000 megatons/yr (6 gigatons), so wind turbines in the US have dropped that value by 1% simply due to avoided methane consumption….. Not bad some a technology that so many though would never amount to much… And at $42/ton of CO2 equivalent avoided (a US Government value for “social cost of carbon”), that’s another $2.8 billion per year every year, or roughly $71 billion over a 25 year turbine lifespan. That is about half the installed cost of the present US wind turbine fleet (~ 126 billion - somebody (at the AWEA) had to count it up…). See http://www.whitehouse.gov/sites/default/files/omb/inforeg/social_cost_of_carbon_for_ria_2013_update.pdf

In 2014, China installed 23.351 GW worth new wind turbine capacity, which was over 45% of the new turbines installed in the entire plane (Earth = 51.477 GW), a very impressive feat (http://www.gwec.net/wp-content/uploads/2015/02/5_global_installed_wind_power_capacity_MW-regional_distribution.jpg). Could Europe and especially the US and Canada replicate that, only with higher quality turbines installed for the purpose of generating electricity and not just to consume labor and manufactured goods? Yes, and create a seriously large number of jobs, too. Is there a shortage of available places to locate new wind turbines, especially the Low Wind Speed variety? No way. Is there a technology to “buffer” the electricity? Yes - it’s called Pumped Hydroelectric Energy Storage - needed when high rates of “renewables penetration”

But would creating more jobs and a lot more affordable electricity for 16% of the cost per kilowatt in tax avoidance subsidies as the nearest renewable competitor (solar PV) be disruptive? Yes indeed. Which is why the meager subsidy that benefits (via avoided methane price spikes/long term price rises) had to be exterminated by the Republicans. The oil and methane business is now having a ”Sad”, along with the financial pirates that were extracting their share from the Exploration and Production side of things - see http://wolfstreet.com/2015/02/09/oil-price-bounce-a-head-fake-could-drop-to-20-citi/. And they will be calling in all the favors they can in the next few months, trying to stave off the ”Repo Man” and then cash in big time as falling production of oil and gas smacks into a steady demand and results in tons of potential speculator profits.


Meanwhile, the answer to what would make actual middle class jobs, a better economy, lower use of fossil fuels, less CO2 pollution and less exports of money (for Canadian methane) is spinning away in front of our eyes. How embarrassing for the methane pushers of America. And for the government of New York state, as we only have some trivial wind energy developments planned before they too end by the end of 2016. Meanwhile, Ontario now has close to twice the installed capacity (3489 MW - http://canwea.ca/wind-energy/installed-capacity/) of NY State (in 2013 the numbers were roughly equivalent - http://en.wikipedia.org/wiki/Wind_power_in_New_York). And that ratio will double again in a year or so, all because Ontario had a sanity event with regards to electricity pricing (the Green Energy Act of 2009), something which NY State has scrupulously avoided. Oh well, sometimes we reap what we sow, and how much we reap can be a function of the fact that we are really not even trying much at all…. 

Sunday, January 25, 2015

2015 and Norway Goes for Wind Energy


Recently there came an announcement that Norway would install 1 GW (about $US 2.5 billion worth) of wind turbines just from one provider (Vestas - http://renewables.seenews.com/news/norways-statkraft-picks-vestas-for-1-gw-wind-turbine-order-459069). This uses up a lot of the 2013 decision to  to deploy about $3 billion worth of turbines in a separate set of projects. So Norway is going to seriously up their existing 704 MW worth of installed capacity - but then so are a lot of countries. Cool, but what’s so novel about this?

Norway is country whose electricity is essentially all renewable energy sourced already. It is a sparsely populated nordic country that seems to have a lot in common with the “How to Train Your Dragon” movie - “snowy 9 months of the year and hail the other three” as well as “twelve days both of hopeless, and a few degrees south of freezing to death. It’s located on the meridian of misery” where there actually is a small probability of sunshine” - http://www.schoolofdragons.com/how-to-train-your-dragon/areas/isle-of-berk. But thanks to the remnants of the Gulf Stream, it is actually warmer than it longitude (56 degrees to north of the Arctic Circle) would otherwise indicate. There are lots of hills and mountains located near the coast, which is of the North Sea/North Atlantic/southern Arctic Ocean. Those are some of the nastiest waters on the face of the earth - huge waves, near constant gales and worse for weeks on end. There is almost no such thing as forest fires - its is just too darn wet - either from snow, rain or melting glaciers/snowpack. It has 937 hydroelectric stations that supply 99% of the domestic electricity supplies, and depending on the rain/snowfall, lots of electricity to export.

It’s 29 GW of hydroelectric potential delivered an average of 16 GW in 2008, a typical year. The country exported 3 GW of electricity for that. It uses “deferred hydro” as an energy storage arrangement with Denmark - when there is excess wind, some Danish electricity flows into the Norwegian grid, and the flow of water through some dams is curtailed. When it’s not so windy, the stored water is used to generate extra electricity. In contrast to “pumped hydro” energy storage (about 80% efficient), deferred hydro is as close to 100% efficient as can be had. Norway and Denmark are interconnected with underwater HVDC lines (“Cross Skagerrak”) with a 1.7 GW capacity in four transmission lines. In effect, Norway (and to a lesser extent, Sweden) are the “batteries” for the Danish wind industry. There are similar HVDC lines being arranged for Scotland, England, Germany and the Netherlands (http://en.wikipedia.org/wiki/NORD.LINK). This is especially important for Denmark because thanks to the Anholt offshore wind farm, they now produce over 40% of their electricity from wind turbines. And at such a high wind energy penetration, batteries are needed….

So Norway has no domestic need for the electricity made from these wind turbines. Apparently, this new wind based electricity is all about exports of electricity for money. But Norway is already such a massive ”over-exporter” thanks to natural gas and oil that its Sovereign Wealth Fund (thanks largely to government ownership of the main oil company, Statoil) now has roughly $US 850 billion in its kitty. Do they really need more? Oh well, at least getting money for the turbines should not be a problem….. http://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway

Actually, the latest ebb and flow of world oil prices as well as the methane that is priced in Europe based on oil prices has a lot to do with it. And so does the depletion of the once massive North Sea oil and gas fields (see http://www.indexmundi.com/energy.aspx?country=no&product=oil&graph=production). After peaking in 200 at around 3.2 million barrels/day (mbd), that has now dropped to less than half of that. The new oil fields being found are smaller and even more costly and difficult to tap, and at $50/bbl, they no longer make economic sense to do. Meanwhile, methane production (both from standalone fields, depleted oil fields and gas-only fields) has also peaked last year at 4.5 trillion cubic feet/yr (http://www.eia.gov/countries/country-data.cfm?fips=no#ng - about 1/6 of what the USA makes, with just 5.2 million people).

So, for them, the future appears to be heading in the direction of wind energy. Plus, a couple of years ago - they got quite the climate scare - rain and snow rates dropped drastically for close to a year as did electricity output (increasing weather unpredictability is an effect of Global Warming). But it was still plenty cold, and most residential and commercial heat is supplied by - electricity. Methane is either for chemicals manufacture or for export (sort of like “why eat your seed corn?”), so making sure there is enough electricity - precipitation or no precipitation - is important. And as their fossil fuel money ball depletes despite heroic efforts to milk the North Sea some more, well, at least there is the wind to fall back on.

Perhaps there is a lesson there for the Governor of NY - who supposedly is searching wherever the realm he resides in  for new supplies of energy now that the fracking dream in NY (which never really existed except as some weird fantasy, anyway) and also the nuclear nightmare (at least there are no more new ones planned, though there are still six “oldie moldy” ones cooking away and getting older and more worn out every day. If Norway, which could easily convert methane into electricity and export that elsewhere as well as make up for any shortfalls in hydropower can opt for wind, why can’t NY? Why search the seas for the Great White Whale like a modern version of that demented Captain Ahab, when placing turbines offshore of Long Island will actually bring whales to NY’s waters (once the construction is done, nice fishing and foraging around offshore wind turbine foundations). Is that too much to ask for?



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