Which Low-Carbon Plan has the Lowest Risk and Cost?

Figure 1: 2017 Technology Neutral Low Carbon Solution from Joint IEA and IRENA Study for Germany

Jesse Jenkins and Samuel Thernstrom just published a paper that might be described as a meta study of meta studies:

In addition to the 30 papers directly reviewed, this literature review also covers other review articles (Cochran, Mai, and Bazilian 2014; Morrison et al. 2015) that summarize findings from an additional 21 previously published studies, as well as Kriegler et al. (2014) and Krey et al. (2014), which describe results from a detailed inter-model comparison exercise involving 18 energy economic and integrated assessment models.

As it turns out, dispatchable baseload significantly decreases the cost and technical challenge of decarbonizing power systems. Huh, could that be why we use it in virtually all power systems today? There are only three low carbon, dispatchable power sources: nuclear, biomass, and hydro.

All three are resisted by major environmental groups but only two out of the three are resisted for rational reasons:

1. Biomass displaces carbon sinks while usurping land needed for food production and biodiversity and in most cases isn't low carbon at all.
2. Hydro destroys thousands of miles of river ecosystems (think end of the Amazon, extinct river dolphins and salmon runs) and can produce massive amounts of methane as submerged vegetation decomposes. In addition, it can't always be used for baseload depending on precipitation patterns, and to ice the cake, dams eventually silt up.

This paper was, in turn, written about in Utility Dive where Mark Jacobson (mastermind behind a hypothetical global zero-carbon energy master plan based purely on wind, hydro, and solar), was asked to weigh in on the critique of his work found in said paper:

Globally, new nuclear power stations are becoming one of the lowest cost sources of energy

Figure 1: Global LCOE from IEA Projected Costs of Generating Electricity, 2015 Edition

I was skeptical when I first saw the nuclear data (encompassing 11 new nuclear power stations). Being a joint venture between the IEA and the NEI, I wanted to check for pronuclear bias. And of course, any projection into the future is suspect but this one only went out to 2020, which is just three years away. So, I went looking for verification. I crosschecked the above values for the energy sources listed with those found by other sources, such as the EIA (not to be confused with the IEA) and found that they were reasonably consistent.

I then crosschecked the LCOE values for other countries from different sources and found them to also be similar in value.

Turns out that the cost to build nuclear power varies greatly from country to country. But when you look at the global range, average, and median LCOE (levelized cost of energy) for the new nuclear power stations built in the last five or so years, they're amazingly competitive. Hydro and coal are still shown to be the cheapest source at the 7% discount rate shown in Figure 1, but because hydro can't, and in my opinion, shouldn't scale up appreciably in the last remaining river ecosystems in the last biodiverse regions of the planet, I'm hoping its low cost does not lead to more of it. The study assumed a $30/tonne carbon penalty which makes coal look more expensive than it actually is ...because there is no global $30/tonne carbon penalty. The study also provided results for 3%, 5%, and 10% discount rates. 

Case in point; a South Korean company will bring on line a 1,400 MW reactor, Barakah 1, (the first of the four being built in series for the United Arab Emirates) this year after starting construction in July of 2012. All four are ahead of schedule for completion by 2020, which is an average of one nuclear reactor every two years. Two years is the same time frame used by Lazards to calculate the LCOE (levelized cost of energy) for wind and solar. The LCOE for these Korean reactors being built in the UAE is in the lower portion of the nuclear range in Figure 1.

One of the main costs of nuclear is the interest being paid on loans while it is being built (number of years without any income to start paying off debt). All else being equal, the faster you can build one, the cheaper it is. South Korea is proof that nuclear power stations can be built very rapidly and cost effectively once a company has acquired the necessary level of  engineering and manufacturing expertise (along with its suppliers).

From an article in The Economist regarding the Barakah nuclear power station:

IEA Renewable Energy Medium-Term Report 2016

I received an invitation from the IEA (International Energy Association) to participate in a WebEx presentation of their Renewable Energy Medium-Term Report 2016 (a five year market analysis and forecast), which was at 9:00 PM Paris time ...arrrgh, 6:00 AM my time. I also received an embargoed PDF of their report, not to be released until October 25th. The PowerPoint presentation was given by Paolo Frankl, head of the IEA Renewable Energy Division. I took several screenshots of the presentation as well.

In a nutshell:

Figure 1: Screenshot From the Presentation--Renewable Energy Capacity Additions

 Some things to note about Figure 1:

• Most growth in renewable energy has been in wind and solar, wind in particular.
•  Shows capacity, not actual energy production.

I tend to read between the lines of studies to ferret out what the researchers chose not to highlight. If you want to see what they chose to highlight and how they chose to do it, here's the link to it.

In the end it's energy production that counts, capacity, not so much. Installing solar panels in a cave will increase installed capacity but produce no power. Actual production for solar might be something like 10-15% of capacity and for wind, about 20-30%. A solar panel in Seattle will produce a fraction of the energy of a solar panel in a sunny place, ditto for wind. If Figure 1 were to plot actual energy produced instead of capacity, it would look very different in both magnitude and shape.

I created Figure 2 below using data from the 2016 BP statistical review and an IPCC Assessment report to put the impact of wind and solar into perspective. I wanted to put it into perspective to demonstrate that wind and solar alone are very unlikely to get us to an 80% reduction in emissions.

Keep in  mind that emissions displaced depend on energy source displaced. If hydro or nuclear were displaced, emissions actually increase. If natural gas is displaced, emissions will drop but natural gas emits a lot less carbon than coal. Wind and solar rarely displace coal because coal is primarily used for baseload. Claims that wind and solar have replaced coal are actually the result of switching from coal to gas so that it can dampen erratic wind and solar output. Typically, wind and solar serve as fuel reduction devices for natural gas power stations which limits their ability to reduce emissions, particularly from coal.

Figure 2: Total Global GHG Emissions in Million Tonnes CO2 Abated by Wind and Solar

Typically you see bar charts that paint solar and wind in a more favorable light.

• They may show installed capacity instead of power output.
• They may chart growth rates as opposed to percentages of emissions abated.
• They may show power output instead of emissions abated.
• They may only compare their abatement to emissions from electricity production as opposed all sources of emissions (deforestation, heat, transport etc).
• The chart may not start at zero, making their contribution appear much larger, and on and on it goes.