Tell us it ain’t so!

Infrastructure investor John Laing is putting on hold fresh investment in renewable energy projects in Europe and Australia because of a lack of wind.

Olivier Brousse, chief executive, said: “Wind in Europe over the last 18 months has been lower than anticipated. We’ve commissioned a long-term forecast on wind in the region and it is a lower number than we thought.”

This means its windfarms are not generating as much power as expected. As a result it took a £55m hit on the value of its European windfarms.

You mean renewables calculations have been based upon errors about reality?

Surely not…..

17 comments on “Tell us it ain’t so!

  1. We’ve commissioned a long-term forecast on wind in the region and it is a lower number than we thought.

    You mean these long term forecasts stating we’re all going to die horribly from climate change may not be accurate?

    Colour me shocked.

  2. You’re only doing that now? Why would you invest millions on anything other than the very best forecast available?

  3. I think we can now safely go in to “told you so” mode.

    We’ve been having discussions on here for years about the only way to make it work was to set all business plan plus assumptions at the very top end and all the cost assumptions at the bottom end. I remember a few of the stories about them forgetting maintenance costs.

  4. “a long-term forecast on wind ”
    Does he really mean ‘wind’ as in weather forecast? They can’t get that right better than 50% for next week. Or does ‘wind’ in this case mean the business of extracting subsidies from the gullible etc.

  5. RlJ – because the level of subsidies and incentives available made the quantity of the actual resource irrelevant to the calculation?

  6. ‘You mean renewables calculations have been based upon errors about reality?’

    OY beat me to it. Making and selling electricity is on page two of the business model.

  7. Is solar more attractive than wind even this far above /below the equator these days?

    Is there a simple reason solar costs have come down so much more than wind has?

  8. Well, yes. We’ve had wind power in Europe since the 12th century. It’s a reasonably mature technology.

    Solar on the other hand is only a few decades old. The basic manufacturing tech is still coming along in leaps and bounds. About a decade back the silicon ingots we make it from went from $450 a kg to $30 a kg. We’re still in a world where solar is falling in price at 20% per annum on average.

    There’s no obvious reason why solar won’t be cheap, cheap, cheap, in a decade or three. Which is when we should install it of course, not now.

  9. Solar being cheap, cheap, cheap… this again.
    So this again… it is a matter of physics, not economics.

    Solar power is not practical without continuous backup from either fossil fuel or nuke to ensure continuous tension and frequency to circuit in a house… which solar panels, not least at night or poor light conditions, or even with magic batteries cannot provide.

    More important, without very large subsidies there will be no fossil fuel or nuke, solar will come with periods of no electricity or frequent circuit breaker activity – or if you are really lucky, damaged electrical appliances and fires. But never mind because the solar panels were cheap.

    Look up topics like ‘on load drop’, frequency fluctuations and how caused.

  10. Tim,

    The problem with solar panels getting cheaper is that eventually the main cost driver will be installation and maintenance, both of these are human intensive so costs hard to drive down.

    What’s needed are the efficiency gains in the article Ken linked, but they are a long way off and its hard to see the 9% projected increase coming to market, but if they do its still 10 years off.

  11. Cheers all.

    @BiND

    Presumably this is linked to the rise of big solar installations in fields, rather than more expensive and hard-to-maintain rooftops?

  12. MBE,

    When I read Tim’s comment and thought about it that was my first reaction. Then I thought about it a bit more…

    I don’t have any special insight as I’m not in that industry. However I was involved in building a lot of mobile sites in rural areas.

    Solar panels on roofs are connected to the grid via the homeowner’s connection with little cost. A solar farm needs a high voltage connection to the grid, good enough to support peak power, the bigger the farm the bigger the connection. Those sorts of connections are not cheap even if overheard connection is allowed, but from my observation they seem to be dug in and believe me that is eye waveringly expensive.

    Also the infrastructure to support the panels looks quite involved and will require concrete foundations, expensive and not exactly CO2 neutral.

    I’m happy to be corrected, but unless someone has real insight I’m going with lots of hidden costs they aren’t admitting in the CBA calculations.

    As I typed that I had another thought, do solar farms dump at peak power to save on infrastructure costs? The peak to mean ration must be quite high.

  13. Firstly, renewables calculations have not been based on errors (someone making an accidental mistake), they have been based on lies (“the wind is always blowing somewhere”, “wind is cheaper than gas” – not if you feed in the correct life of a windmill and/or the cost of keeping a gas-fired power station on standby, etc.)
    Secondly solar water heating panels are economic without a subsidy (although the price of installation jumped when a subsidy was introduced). They were economic in the North of England in the 1970s and the technology has improved since then. Water heating is a significant percentage of UK fuel consumption so switching the emphasis from the uneconomic solar PV to the economic solar water-heating would be a painless way to reduce CO2 emissions.
    Renewables are fine for stuff that is not time-sensitive which is why the Dutch use them to pump water out of polders – a job that needs to be done but, unless there is a significant period of inaction, it does not mater when it is done.

  14. Weather dependent electricity generation can only be supplemental.

    Because it is weather dependent.

    ‘There’s no obvious reason why solar won’t be cheap, cheap, cheap, in a decade or three.’

    Nope. If it makes too large a penetration into the market, it will have to pay for its backup. Today, its backup is free. It can’t survive if it has to pay for its backup.

    ‘Which is when we should install it of course, not now.’

    Great line!

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