I used to work in wind energy in the Netherlands, it is only profitable there due to government subsidies. It was/is an enormously complicated system to understand on the whole. I was on the environmental impact side (visualizations) during the permitting process. It's high-risk & enormously expensive during the permitting process (i.e. getting permission to build the wind farm), and beyond that I understand it's a bidding process and again, super complicated on the energy trading side once you're operating. My experience was that the wind farm operators seemed to be doing well financially, but insanely lucrative? I'm not sure about that vs. non-renewables. Everyone I worked with (including myself) believed in green energy as a part of a larger mission to make the world a slightly better place. EU directives on renewables is what pushed the mission forward; the dutch on the whole (surprisingly), do not love wind turbines in their back yard.
Maybe you should build them 36 traditional windmills instead. Or, like, 9 traditional-looking giant ones.
In my post above I talked about seeing the Vestas V164 in person, but I've also been on top of the tallest wind turbine in NL (manufactured by Lagerwey). The higher the nacelle and the larger the rotor diameter equal more power generation (the higher you go the more wind you'll find), but public acceptance has a lot to do with things.
I've seen in person how the Dutch can lose their mind over wind projects, I was in Drenthe in 2014 at a public engagement night (where the public sees visualizations of the turbines, and learns how they can benefit and so on...). At Drenethe there were hundreds of locals protesting, cops, drama. Super scary. I was involved on the public acceptance side of things and have come face to face with countless thousands of scared and angry people. I can't imagine what selling a HUGE turbine for their backyard might be like, but going back to your original idea - selling a classic looking windmill would likely be very easy. The tradeoff is that classic windmill would likely generate a negligible amount of energy in comparison. But cool idea anyhow ;-)
Keep in mind that a typical windmill and a wind turbine are very different in size. Some people are afraid of noise, or shade. Especially if your home will be shaded by the blades, I could see that being an issue as you have flickering light all the time.
I'm sure a lot of the cranky old people near me don't like them, but they hate everything and go out of their way to find things to complain about, to be honest.
With the bike lanes, public transport, solar panels, and wind turbines, it even beats that problematic yogurt commercial…
Of course we’ll need a way to resolve fluctuations both rapid and slower. Rapid fluctuations are handled by pumped hydro and increasingly by batteries.
The slow fluctuations (day/night all the way to summer/winter and good/bad weather patterns) are much trickier, I think it’s still unclear how well handle them, but it will certainly be partly handled by having an excess of renewables, though we’ll likely need some other solutions too, nuclear is probably one of them.
Now Hinkley Point C is another story. It's a hugely expensive boondoggle which is taking decades to construct at enormous cost and the reward at the end is that they are rewarded with a strike price that is 3x that of solar and wind. That is an obsecene subsidy forced on to customers for a power source that cant even do load following and doesnt help with fluctuations in supply and demand.
The slow fluctuations on cold, windless nights or when nuke plants are down for unplanned maintenance are going to be managed with gas.
Maybe one day it'll be gas synthesized with electricity from solar+wind overproduction on a day like today. The roundtrip is expensive, but will still be cheaper than nuclear power on a windy, summer day.
This is how markets are supposed to work. It provides an economic incentive for production to increase, which is what we want.
Consider what happens if you develop a farming method to produce potatoes for a fraction of the usual cost, but you can only meet 10% of total demand at your local market. What price are you going to sell your potatoes for when you show up to the market? You (like any free market seller) want to maximise your return, so you'll be able to sell for a fraction under the previous market rate, undercutting everyone else. Your farming method would be extremely lucrative.
If you triple the price, you don't have a new gas plant appear out of thin air. And the result won't really be lower consumption either, because most people would have fixed rate contracts (not in the UK so don't know specifically, but this is very common elsewhere)
No, because remember you are only able to meet 10% of market demand. The expensive producers will still get 90% of the business, and the market price for their product will remain basically the same. This is what we observe in the electricity markets today: the price to us is the cost of the most expensive product. The cheaper producers who cannot meet the full market demand still get to sell at the cost of the most expensive product.
Which would mean it's super lucrative and your same laws of economics will tell you that that means they'll be building like crazy.
My while point was that as soon as you get to a day where no gas is needed you've lost the ability to react quickly because no supplier will just leave a gas plant around just for that
Investors begin to refuse to build new potato farms because a return on their investment gets worse whenever anyone decides to build a new farm.
But the people need potatoes and more potato farms! The government issues an incentive scheme to guarantee a minimum price for each potato sold. Potential farm owners bid against each other for the lowest price, but it means they can build a farm and expect to break even.
If they all refuse, then they're leaving money on the table. One investor could invest in 10% production only, and that would be very lucrative. It would be exactly my low cost to produce potato scenario.
In practice, they don't all refuse, or all invest. The market finds a balance. In time, producers switch to the new method, because anybody who doesn't leaves an opportunity for someone else to take their business and make more money.
This takes time, though. If we want things to go quicker, then we need to guarantee return on investment for longer, which is exactly what the government does by guaranteeing prices to renewable energy producers.
Yes exactly. The incentives to renewables producers exist to ensure accelerated growth. This may mean we are paying more for renewables in the short term (though no more than fossil fuels) but the investment should pay dividends in future.
One system is taking the money and turning round and handing it to their fuel suppliers, the other is turning round and handing it to the people who loaned them money to build a giant complex structure that would take a decade or more of risk and uncertainty to pay itself back.
Gas bids high because it literally makes no business sense for them to operate for less than the gas input costs. They'd rather sit it out when electricity prices are lower. Renewables will take almost any price once built because wind and sun is free, but won't build in the first place without a path to paying off their investment over a certain timespan.
(This is why more solar has been built in places with good low risk finance than where the sunlight resource is strongest)
CfDs are a competitive bidding process and so give a market price for what developers need their price to be over 15 years or more for it to make a standard return on investment. Developers outside this process need to guess what electricity prices will be, at the times they generate for years to come.
Doesn't this mean that solar/wind are insanely lucrative?
Also, this would mean that in order to really bring the price down, gas needs to be taken out as a source. But gas is typically the source that balances the grid because its output can be changed quickly. So price wise, you might get a drop but you would lose your ability to react quickly to fluctuations in demand