Keep the offshore grid independent of generators
Article originally appears in CommonWealth, March 31, 2018
Ed Krapels | Anbaric Development Partners
We’ve come to expect the miracle of Moore’s Law from our computer technology – exponential progress in speed, power and efficiency, all while prices drop. Until recently, the world of electric power has been a laggard, but that’s quickly changing: At last, the relentless forces of innovation are now bearing down on electric power, with profound implications for how we will harness and deliver it.
Moore’s Law is arriving to the energy field in many forms, including immense wind turbines, advances in solar panels and energy storage, and the promise of micro-grids that enable energy self-sufficiency. The technology onslaught guarantees prices will continue to drop for a variety of renewable energy sources. The trend poses an existential problem for legacy energy producers, who risk being left behind as old, dirty, and expensive. It also poses a challenge to policy makers: The governments that plan for the inevitability of renewable and relatively cheap power will seed the industries and new jobs that will propel the transformation. This lesson could be particularly important as Massachusetts looks beyond its first offshore wind procurement in late April.
General Electric’s giant Haliade-X, a new 12-megawatt offshore wind machine, is a perfect emblem of the energy paradigm shift. Some 850 feet tall, it will double the capacity of the company’s next largest turbine, setting the stage for large-scale offshore wind power generation. It’s a commitment from a company that already knows which way the wind is blowing – toward increasingly cheaper wind prices that already compete with fossil fuel generation. In Europe, where 25 gigawatts of offshore wind are expected to be in operation by 2020, there’s no turning back: wind farms are taking root even on floating man-made islands.
The U.S. couldn’t help but notice. Massachusetts, New York, New Jersey and Maryland all are planning to procure significant amounts of offshore wind, and they all have decisions to make about new and legacy generation. The question remains how much the old thinking will limit future possibilities. For example, the typical cost trajectory of nuclear and hydropower is up: each new project being developed by North American utilities is more expensive than the last. Nuclear projects in the United States and Canada are wildly expensive, and some large Canadian hydroelectric projects are billions of dollars over budget and years behind schedule. The price of electric power coming out of these projects is over $100/MW per hour. The price of power coming from new turbines is likely to be well below $100. Which is the better bet over the long term?