Renewables Update

Illusionary base-load argument is fading

28 February 2014 Tomas Kåberger, Chair of Executive Board, Japan Renewable Energy Foundation

Renewable energy cost less than fossil fuels and nuclear power. Wind, and recently even solar, power plants can be built with lower investments than new nuclear power plants. Once build solar and wind power provide electricity without any fuel costs.

So why should nuclear still receive government support? The remaining argument is that it is important “base load power”.

“Base load power” used to be a term for power plants that were relatively expensive to build but had the lowest cost for fuel and operation. Such plants were build until they covered the minimal consumption, the "base load" in the electricity system. Then, once started, they were kept operating as much as they could.

Half a century ago, such plants were typically large coal or nuclear power plants. They created problems to the grid as they sometimes suddenly stopped, which threatened the stability of the grid and sometimes caused blackouts.

Today, “base load power” in many countries is solar- and wind power with zero fuel costs. Their production varies in a predictable way, and as many small generators operate in parallel there is no risk of a technical problem in one plant causing the power system to fail.

Electricity consumers enjoy the supply of low cost power. In Europe and the US, whole sale market prices have fallen as a result of new renewable capacity being brought on line.

The old power companies, those who own the aged coal and nuclear power plants that are out-competed, suffer. Their coal and nuclear plants are operating less, and when they operate, electricity prices are lower. Thus, it is not a surprise that they want to stop the new sources of electricity.

Renewable energy is a blessing to consumers in industry and household buying electricity as it reduces their costs and improves industrial competitiveness. But, competition is horrible to old power companies loosing income.

Flexible power plants that were used to cover "peak load" are now used to cover periods when the low cost renewables do not meet demand. This is no longer at periods in the middle of the day when demand is highest, as solar power can provide low cost power in the day.

While obsolete terminology confuses the thinking of old fashioned companies and bureaucrats the development of modern systems is accelerating. Those who have succeeded want to do more. Denmark has reached a third of electricity from wind, and together with biomass co-generation it is getting around half of its electricity from renewable sources. The ambition of the Danish parliament is now increased to get 50% of electricity from wind alone by 2020. This will create electricity affluence, sometimes providing several hundred percent of traditional demand. Wind power will also be used to produce renewable fuels and stored as heat.

Japans power companies prefer to expose Japan to risks of further reactor accidents, and continue to import fuels. The government is loyal to the power companies, and allows them to continue refusing others to connect wind power plants to the grid. Power plants that would provide cheaper electricity.

Why do Japan's industry and consumers accept this waste of resources?