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Agreed on all your points except perhaps:
Crazy Horse:
Redundancy costs?  Any time the marginal gas plants already there don't run, they are avoiding the likely staggering fuel costs of the future.  That's a value, bolstered by their ability to be turned on when needed.

My point here is that (say) the costs of running a gas fired power station are 50% fixed, 50% variable (i.e. proportionate to the about of electricity produced - due mainly to the cost of the input fuel).

The Unit cost of electricity from such a plant operating at 10% capacity (i.e. only at times of extreme peak demand/low average wind speeds) is (50+50/10)/10 = 5.5 per 1% unit capacity

If that same plant is operating at 50% capacity the equivalent unit costs is (50+50/2)/50 = 1.5 per 1% unit capacity - in other words almost 4 times cheaper.  Thus there is a marginal cost to maintaining more redundancy because of greater intermittency in the system.

"It's a mystery to me - the game commences, For the usual fee - plus expenses, Confidential information - it's in my diary..."

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sat Jul 19th, 2008 at 04:49:36 AM EST
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