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The article's main hypothesis is this, though:
it is increasingly difficult for the market share of variable renewable energy sources at the system-wide level to exceed the capacity factor of the energy source.
There are two problems with that "thesis:"

First, there's the fact that they cannot possibly have calculated the theoretical maximum market share of anything.

The theoretical maximum market share of a volatile renewable depends on the extent of the harvestable resource (for offshore wind this is for all practical purposes infinite, but that is not true for all volatile renewables), the degree of correlation between the volatile output of electricity from the modality and the (also volatile) demand for electricity, and (crucially) the capacity and dispatchability of available storage solutions.

Calculating the theoretical maximum market share, even under the assumption that consumption cannot be moved* is a non-trivial exercise in applied statistics. Which they haven't done. What they've done is look at past data, come up with a rule of thumb to describe it which kinda-sorta works (if you're not too picky about the technical details of the industry they're "studying" and the comparability of the data they're comparing), and proclaimed it a law of nature. Which is bullshit.

Second, capacity factor (actual energy delivered divided by how much energy would be delivered if you were running at full nameplate capacity at all times) has nothing to do with market share (actual energy delivered divided by the total energy consumption of the market into which you deliver energy).

The capacity factor of a particular site depends on the average availability of the harvested resource and the capacity deployed to harvest it. You will notice that these two numbers, capacity factor and maximum market penetration, share precisely zero underlying variables. Which means that to get from one to the other, you have to make all sorts of sketchy assumptions about pricing regimes, correlation coefficients, market structures, and so on and so forth. Assumptions which are never clearly spelled out. That's also bullshit, and it's dishonest bullshit too.

- Jake

*This is a very ambitious assumption, since much consumption can in fact be moved. But if you allow consumption to move in response to prices, then you need to model the full equations of motion for the demand and electricity prices under your market structure of choice. Which is for most realistic (or even merely interesting) market structures not possible.

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jun 10th, 2015 at 07:01:45 AM EST
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