Sun Jan 8th, 2012 at 07:25:34 AM EST
The main tool used to clean up electricity generation lately has been to guarantee certain minimum price levels for power generated with specific technologies. These feedin tarrifs have varied from "not that much more than typical production costs for baseload" (wind) to "insanely high" (solar), but they have all been aimed at getting specific green generating technologies manufactured and deployed, and forcing utilities to buy the power they produce, in the hope that this would help transform electricity production into a clean, reliable grid.
There is a number of problems, however. These tarrifs have gotten quite considerable amounts of renewable capacity built, but because the tarrifs were set per technology, rather than simply being a fixed rate for any low-carbon generation, they amounted to politicians dictating technology choice. Badly. A lot of what has been built was, and will forever be, complete lunacy. Rooftop solar in northern europe is never, ever, going to make sense. Looking outside is a sufficient demonstration of this. - that could be easily fixed, of course. A "secular" tarrif uniform across technologies would not cause people to pour billions down dead ends.
The more serious problem is the investment decisions that utilities are taking due to forcible addition of intermittent generation to the grids they operate.
frontpaged with minor edits - Nomad
The end goal is a grid that is wholly low carbon, affordable, and a reliable supplier of electricity. The investment decisions taken in the current enviorment is meeting.. none of those three, because all that is getting built is gas turbines. Gas turbines can be easily turned off when the wind blows, but if this is the sole investment undertaken to accomodate intermittency then renewable electricity will be hardcapped at the point where the maximum local renewable generation exceeds local consumption. Without grid interconnections to move power away on windy days, or storage facilities to hold the power for weeks, at that point if you add more renewable capacity, you are at best throwing away electrons, at worst, you are blowing up your grid. And this happens at a point where at the very most than a third of all electricity is green. And everything else is gas.
This is a very stupid way to put a grid together. It is hideously costly, it relies on a vast import and consumption of scarce resources, it reduces greenhouse gas emissions by at most 50% compared to just going 100% coal, and oh yes, natural gas has been responsible for outright cataclysmic disasters before.
It is also exactly where we are currently heading.
The desired end point is "no coal, no gas, reliability" So the correct intervention in the market is the one that gets us there as directly as possible.
Tax coal, tax gas, use the income to build grid interconnections and offer contracts for storage facilities. - Again, without picking technologies. Simply offer a flat payment per mwh storage capability at a given efficiency.