RE: Solar heated hot water

["Neil Ball" <neilball@xxxxxxx>]

Hi Bruno

I've followed the thread with keen interest. I notice that the
stirling-engined domestic chp units are getting more press again recently.
What's your view on this. Do you think this technology has a reasonable
cost/benefit ratio for anyone installing/replacing boiler plant or is it
still too early to make any real decisions?

Neil




-----Original Message-----
From: Bruno Prior [mailto:bruno@xxxxxxx]=20
Sent: Monday, April 07, 2003 19:19
To: ukha_d@xxxxxxx
Subject: Re: [ukha_d] Solar heated hot water



Ian Lowe wrote:
> Deeply thought provoking Bruno.
>=20
> I have been watching BP Solar's developments (especially the whole=20
> roof shingle replacement systems)  with interest, I seem to recall=20
> reading (possibly on the BP Solar website, actually) that the key=20
> problem at the moment with manufacturing is simply one of low
volumes,=20
> and that the energy cost and chemical usage could be improved
greatly=20
> through larger scale manufacturing processes.

We sponsored the inaugural conference of the Renewable Power Association=20
last year, and as part of our contribution, we commissioned a report by
Dou=
g

McWilliams (former Chief Economist at the CBI) and his brother Mike into
th=
e

true (i.e. including hidden) costs of different electricity generation=20
technologies and locations. It makes for pretty dense reading, but if
you=20
are interested, you can download it from:
http://www.summerleaze.co.uk/regen/renewable_power_economics.doc
We are currently in the process of updating it and adding other=20
technologies, but one of the conclusions that leapt out was that PV is, by
=
a

long chalk, the least economic of all generation technologies examined.

Not surprisingly, this got the PV guys pretty agitated, and several of
them=
=20
came to our stand to argue their case. Their strongest point, in my
opinion=
,

was that it was unfair to apply the full cost of the panels to the initial=
=20
capital cost, as they were intended also to serve as roof tiles, and=20
therefore the avoided cost of normal roof tiles should be deducted from
the=
=20
capital cost. I would say that this is fair comment for new-build
projects,=
=20
and irrelevant for anyone looking to install at a location where they do
no=
t

need to replace their roof tiles. I assume it would make a significant=20
difference to the economics, but probably still leave them as the least
viable.

As for the economies of scale that BP are hoping to achieve, PV is now
bein=
g

installed in significant volumes in Germany, thanks to that incredibly=20
expensive feed-in tariff. It will be interesting to see if this has a
major=
=20
downwards effect on prices. But it seems to me that this is a chicken
and=20
egg situation and if any company is in a position to take a lead, it is
BP.=
=20
If they really believed in it, they would go ahead and build the
large-scal=
e

production facilities to produce loads of cheap panels to grab a
dominant=20
share of the market. Given their size, they are quite capable of making
tha=
t

sort of investment now. The fact that they complain about volumes
without=20
committing to increase their production facilities to deliver these=20
economies of scale, says to me that they are not _that_ confident that=20
prices can be decreased to a point where PV installations will become=20
widespread. Of course, that's not surprising. Large, public companies tend=
=20
to be very risk-averse.

> The dynamics of a vastly distributed power generation system, with=20
> almost every roof covered in PF tiles of some sort, and huge fuel
cell=20
> systems (in place of current power stations) acting as national=20
> reservoirs sound like Sci-Fi just now, but I suspect are not so far=20
> fetched in the decades to come..

The McWilliams report highlighted the advantages of distributed power
and=20
the fact that the true cost of transmission is not applied at the
moment.=20
But there are practical problems. The transmission and distribution
systems=
=20
were designed in the days of the CEGB to be a one-directional system,=20
flowing outwards and downwards to each customer. Embedded generation (i.e.=
=20
generation exporting into the local grid) can have a big impact that was=20
never expected by the original designers, so the Distribution Network=20
Operators (DNOs - the people who operate the cables of the formers
Regional=
=20
Electricity Companies -RECs) are less than encouraging to this sort of=20
generation. Our industry abounds with stories of connection quotes of=20
=A3300,000+ per MW, which will kill most renewable projects dead. Apart
fro=
m=20
exceptional circumstances, the biggest component is not usually the cost
of=
=20
the cable and switchgear on the generation site (the shallow costs). Most
o=
f

it is usually the cost of upgrading the wider network to cope with the=20
change in flows and fault levels due to the installation. This is a hot=20
topic in the industry, but there is no easy solution.

At least with purpose-built power stations of 100kW+, it is feasible for
th=
e

DNOs to manage the effect of the generation on the network. Now imagine
tha=
t

they are trying to feed into their calculations the potential PV output of=
=20
every house in their area. They would have no direct information,
because=20
this electricity export is too small to practically operate real-time
expor=
t

metering. So they would be trying to run their network by guesstimate
(as=20
they already do on the demand side). Their primary obligation is to ensure=
=20
that we have 99.9999% availability (although those in the 24/7 region
may=20
have trouble believing that). If you had that sort of obligation, would
you=
=20
volunteer to double (and more) your uncertainty? Remember, not only is
it=20
difficult to store electricity, but an imbalance between supply and demand=
=20
leads to voltage fluctuations, which puts strain on their equipment that
it=
=20
was not designed to take. Denmark (3rd largest wind generator in Europe)
ha=
s

come close to a national brown-out, and Spain (2nd after Germany) had
major=
=20
problems this last winter when we had that high over Europe for more than
a=
=20
month that gave very low temperatures (i.e. high electricity demand) and
no=
=20
wind.

We have to find a way for distributed power to become more widespread, but
=
I

am not convinced that it will take the form of all of us producing and=20
consuming as we see fit, and big fuel cell stations to make up for our=20
unpredictability. My guess would be that the tendency would be for greater=
=20
individual responsibility for energy use - in other words, if we want to=20
generate our own power, we will have to provide our own means to use it or=
=20
store it when it is not wanted on the grid.

> Just wondering, what's your take on Nuclear? I have often found it=20
> strange that nuclear power has not been developed more, (especially=20
> the breeder reactors, like Dounreay) as it seems a particularly=20
> powerful solution to CO2 emissions.

Do you live anywhere near Dounreay? My personal opinion is that nuclear=20
power stations are some of the few things that I would not be prepared
to=20
live near, and if I would not live near it, I should not expect anyone
else=
=20
to either. So maybe we stick them where they are nowhere near people=20
(although that's pretty hard to do on a small island like ours), but we
nee=
d

our electricity where people are - not where they aren't. As I pointed out=
=20
above, the true costs of transmission are much higher than charged by
the=20
National Grid.

The truth is, nowhere in the world is anyone even considering building a=20
nuclear power station in a deregulated market. The only places where
they=20
build them are where governments can use tax payers' money to ignore=20
economic realities. Remember, when Cecil Parkinson was handling
electricity=
=20
privatisation, he discovered that they were so uneconomic that they had to=
=20
be unbundled from the parcels that made up National Power and Powergen
or=20
they would have sunk the whole privatisation. We should not forget that
lesson.

Nuclear has already been shown to be uneconomic even at low transmission=20
costs - just on the basis of its running costs. Why do you think British=20
Energy was going bust if the government hadn't bailed them out? If you
adde=
d

in the true cost of transmission from Dounreay, the capital cost (which we=
=20
paid for when electricity was a nationalised industry), correctly wrote
dow=
n

their nuclear waste as a liability (rather than as an asset, as it is
now),=
=20
put in full provision for decommissioning costs, and put a price on the=20
environmental cost of dealing with nuclear waste, I wouldn't be surprised
i=
f

nuclear overtook PV as the least economic generation technology of all.

And there are other factors. For instance, the security implications of=20
having ready-made nuclear targets scattered round the country, just
waiting=
=20
for terrorist-hijacked planes to be crashed into them. Or the
inflexibility=
=20
of nuclear output - you can't just switch it off at night, so what do you
d=
o

with all that power when no one wants it (Mark Marooth provided exactly
the=
=20
right answer to that, but we can't do any more)? Or the impact on the=20
stability of our network and electricity prices of relying on a few
large=20
power stations (when one was shut down by H&S for a month last year,=20
short-term electricity prices went through the roof). Diversity is one
of=20
the biggest reasons why we should have more renewable energy, not more=20
nuclear power. However it goes down (terrorism or accident), the impact of
=
a

few small power stations going down is much easier to cope with than the=20
failure of one big one.

It's just a (very strong) personal opinion, but I would much rather meet
ou=
r

environmental requirements through a combination of energy efficiency
and=20
renewable energy, than I would from any more nuclear power stations. The
da=
y

they close the last British nuclear power station (and better still the=20
French ones lined up along the Channel to make sure that if anyone gets
the=
=20
fallout it's us not them ;-)) will be a happy day for me.

There is a fundamental point here. I take it as axiomatic that competition=
=20
is not just good but essential. Wherever people can avoid competition, you=
=20
get inefficiency and corruption. But nuclear never has and probably
never=20
will exist in a truly open market. Who, apart from governments, is going
to=
=20
take the risk? So a policy of nuclear development goes hand in hand with a=
=20
strong element of centralisation and government control of the energy=20
industry. Is that the environment in which you would expect innovation
to=20
flourish and personal involvement to grow? Look at the history of the CEGB=
=20
and you will know the answer. But as always, what will deliver the best=20
result is individual commitment, responsibility and innovation, not the=20
abrogation of responsibility that is dependence on the state to sort out
ou=
r

problems.

Rant over.

Cheers,

Bruno



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