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New Record Set for World's Cheapest Solar, Now Undercutting Coal (bloomberg.com)
Anna Hirtenstein, reporting for Bloomberg: Solar power set another record-low price as renewable energy developers working in the United Arab Emirates shrugged off financial turmoil in the industry to promise projects costs that undercut even coal-fired generators. Developers bid as little as 2.99 cents a kilowatt-hour to develop 800 megawatts of solar-power projects for the Dubai Electricity and Water Authority, the utility for the Persian Gulf emirate. That's 15 percent lower than the previous record set in Mexico last month, according to Bloomberg New Energy Finance. The lowest priced solar power has plunged almost 50 percent in the past year. Saudi Arabia's Acwa Power International set a record in January 2015 by offering to build a portion of the same Dubai solar park for power priced at 5.85 cents per kilowatt-hour. Records were subsequently set in Peru and Mexico before Dubai reclaimed its mantel as purveyor of the world's cheapest solar power. "This bid tells us that some bidders are willing to risk a lot for the prestige of being the cheapest solar developer," said Jenny Chase, head of solar analysis at BNEF. "Nobody knows how it's meant to work."
Except at night, when solar is a lot more expensive. Or when it rains.
Don't disappoint your bird dog. Go to the range.
I'm sure there won't be any overruns. I mean, there's no reason we reject suspiciously low bids in other projects, right?
somebody should trademark that.
Don't you mean a bet? A wager? Speculation? I think we should wait to see what is produced...
“He’s not deformed, he’s just drunk!”
"This bid tells us that some bidders are willing to risk a lot for the prestige of being the cheapest solar developer," said Jenny Chase, head of solar analysis at BNEF. "Nobody knows how it's meant to work."
Well, I'm neither an economist nor an... electrician? But I have bought a lot of printers that I palmed off on the thrift store people after the original ink cartridge ran out, because it was cheaper to just buy a new one. So I'll take a shot.
The low bidders are selling their electricity for less than it costs to produce because, at some point in the future, they hope to charge a higher price for it, after all of their competitors have had to exit the industry, and, due to inertial effects, would find it difficult to re-enter.
No other industry does this, of course. Oh, wait, almost every other industry does this now.
The most trustworthy of countries.
In government projects, bid cost has only a fleeting correlation to actual costs. See, for example, any major weapons system.
I imagine that the government of Dubai is not immune to this sort of behavior on the part of it's contractors.
Faster! Faster! Faster would be better!
Mostly because they don't have to deal with a Union
Note that these prices are for solar power plants, not for household solar. Here's a comparison with prices for some other types of electricity generation.
Still solar plants have been popping up all over, and this will only encourage more of them, which is a good thing because coal pollution sucks.
"First they came for the slanderers and i said nothing."
They've offered to build it for a price. Let's see if they deliver for that price, or if they can continue to build for that price.
It's also not clear if they've calculated that price based on the peak or average daily output figure. If the former, it'll still be dearer than the coal plant which can deliver peak 24/7.
Not likely they can get (much) more for their power, I guess they're counting on reducing cost through advancing technology or economies of scale, something like that. Just like your typical dotcom.
Probably not the second one. Now - give me back my mod point . . . it was a bad moderation to begin with.
In this case, very low per MWh bids are most likely going to have a requirement to purchase 100% of the output for a very long period. But low bids often come with other terms that can easily show up as change-orders or cost adders. Things like riders for covering costs for maintenance or natural events come to mind, but contract writers can be quite clever.
But if they can use the power that time of day, which is likely, it might be a very good deal. Considering they have very high costs for coal, which I assume is do to shipping it from afar.
Solar power plant produces power during the day which is usually the peak period for demand where the power is usually produced by peaking power plants and gas turbines which are twice or more times as expensive as coal baseload power plants. The solar power plants are actually far more economical than that comparison would indicate.
Here's some quotes from the article that undercut the headline:
" âoeNobody knows how itâ(TM)s meant to work.â
"Plunging costs along with the bankruptcy for the biggest developer, SunEdison Inc., has spurred questions about whether the cheapest projects will ever be profitable."
It seems like there's more to this story that isn't being stated. Unless the costs are subsidized, it appears there's no real way to actually meet those energy prices.
So...they are building a solar plant in the most favorable place on this planet for that technology, and one of the least favorable for coal (have to ship it in from far away); and we still are not sure if the ACTUAL cost of power production is better for solar. This is some kind of bid that might lead to huge losses or need big government subsidies.
They are doing it to get in with the Dubai Electricity and Water Authority, which has a large budget and will likely keep paying them to build more stuff and maintain it maintenance for decades to come. Happens in every industry, companies with capital buy contracts by making an initial loss on them in the expectation that it will reward them later.
For example, in my own industry (water) a company lost a couple of million supplying data loggers to a large French company, but how they have an installed product base, software that talks to those loggers and understands their data formats, staff with experience in those products and systems... It's hard for any else to sell them similar loggers even if they are cheaper now, because the TCO is lower.
Same reason Linux found it so hard to make inroads on the desktop - it's not just the cost of Windows licences, it's the cost of retraining, making other stuff compatible etc.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
and it is done for the bidding price while making a profit for an extended period of time.
Right now it is just developpers willing to gamble to get a contract in which they oblige to do it for the bidding price while not yet knowing how they are going to do it.
So the headline should be 'optimistic gamblers gamble they can make a profit in the future but don't yet know how exactly'.
I am all for solar but this story is wishfull thinking only so far.
> Well there is still solar collection when it is cloudy. There is very few times where it rains so hard that it is like night outside.
Unfortunately your eyes are tricking you. Your eyes perceive brightness exponentially. It looks like a cloudy day is maybe half as bright as a sunny day, and your house maybe half as bright as that. In fact, a sunny day is around 100,000 lux, a cloudy day around 1,000. Inside your home is probably around 50 lux.
So the cloudy day has only 1% of the energy as a sunny day.
This is an important issue.
We don't want some slipshod low-ball bid construction to cause solar energy spills that contaminate the environment and poison wildlife. If they don't correctly build the solar ash retention ponds, a rupture could pour hundreds of thousands of gallons of poisonous solar waste into the rivers.
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
That's not really applicable here, because the governments aren't buying kW of capacity - they're guaranteeing purchase of kWh of produced electricity. Now, there's an advantage on the builders side that they know they have a buyer for every last drop of juice they're going to produce, whether or not there is demand for it, but generally they're not going to get paid unless the taps are flowing.
Is it just my observation, or are there way too many stupid people in the world?
My solar panels would beg to differ. Very cloudy days production goes down but I still get 25-50% of full sun days.
I don't read your sig. Why are you reading mine?
Contract is for 2.99 cents /kwh for energy delivered. Contractor eats any overruns. This is not the US Military pork barrel cost+ contract.
I don't read your sig. Why are you reading mine?
They forgot the price of the land.
Solar panels takes up a lot of land, but coal doesn't.
Coal is also stack-able, and can be used at anytime.
Solar can't.
This is truly excellent news that solar can compete and win on a cost basis, since short term $$$ is apparently literally the only thing that decision makers ever care about.
Poetic and funny! A genuine slashdot AC first
Note that the contract sounds like the contractor gets to sell the power at 2.99c whether or not there is a demand. In some cases cost of power can go to 0 if baseload plants are providing excess capacity into the grid cannot ramp down production. So the plant gets 0c/kwh. In this case, even when the power must be dumped somewhere at 0 value to the utility, the solar producer gets paid. Conversely, when there is demand, and the solar producer has no additional capacity, nat gas peaking plants or some other carbon based generation will be there. I don't mind solar, in fact I have panels, but cost must include the cost of when the solar/alt energy cannot provide the power.
somebody should trademark that.
"Nobody knows how it's meant to work." Anyone involved with government or software contracts already knows how it works: Lowball the bid, then cost overrun to obscene profits. Come on now, are you gonna say I am shocked, shocked!
It's not like they are right next to major oil fields where natural gas is currently flared off at prodigious rates.
I suspect they will be getting at least some of the first 'solar' power that is generated at night.
John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
The energy striking the surface per square meter of full sun is in fact about 100 greater than the energy striking the surface on of overcast day. That's a fact. Look it up anywhere you like.
If instead of capturing 100 times as much, your system only captures four times as much, that can only mean that your system is failing to capture 96% of the available energy on sunny days. That of course assumes you aren't mistaken.
It wouldn't be terrible unusual for a home solar-electric system to be extremely inefficient, as they are designed as much around taxpayer subsidies and marketing as they are technical effectiveness.
That's like saying a Hydro plant has been built on Niagara Falls, forever proving Hydro's dominance over Coal!
Unless of course you don't have a massive water source.... or you live in the freaking desert.
> It looks like most plants use a mixture of sodium and potassium nitrate.
Which are the same oxidizers used in making fireworks. Nitrates + carbon = black powder. Nitrates + metal = flash powder (a few mg of which provide the bang in a firecracker) .
Large quantities of potassium nitrate and sodium nitrate heated to very high temperatures will undoubtedly provide some pretty impressive explosions from time to time.
They'll make it up on constructive changes.
How much power do the solar arrays generate at night?
"So the cloudy day has only 1% of the energy as a sunny day."
My god there's so much bullshit in this post I don't know where to begin.
First off, we perceive brightness in a LOGARITHMIC CURVE, not exponential.
Next, PHOTON FLUX DENSITY (which is what matters for solar, not lux which is weighted at green light) on full cloudless day is ~2,000 umol per square meter per second. On a cloudy, non-rainy day, you can expect about ~1,100 umol, about as bright as it is on Mars (Mars is like closer to 900 umol.)
You've got zero clue what you're talking about. Be quiet.
Still waiting on Serviscope_minor to wake up to fucking reality and realize that Jessica Price isn't going to fuck him.
Which part of 2.99 cents / kwh don't you understand?
They get 2.99 cents for every kwh they deliver.
I don't read your sig. Why are you reading mine?
which part of whether there is a demand for the power or not do you not understand?
Nope, doesn't work that way. The levelized cost of electricity (LCOE) is based on the efficiency, degradation rate, and solar availability of the region. Projects are financed based on LCOE not some wishful thinking that the price will go up some day. If anything, it will go down as PV conversion efficiency goes up and manufacturing/supply chains get cheaper and bigger.
I swear, now that PV is finally getting to cost parity with fossil fuel sources, people have switched from saying "it'll never happen" to making up conspiracy theories. Well, at some point you'll just have to accept it - the end of the fossil fuel age is near.
The stone age did not end because we ran out of rocks. The fossil fuel age will not end because we ran out of fossil fuels. It will end because we replaced fossil fuels with something better, and that something is PV.
US (First Solar) and Chinese (Jinko Solar) put in bids at 0.039 $/kWh. The Middle East firms may be subsidized, but these two international developers basically just set the floor for profitable, unsubsidized solar. 10 to 1 both these firms have better net profit margins than gas turbine manufacturers. No need to even mention coal, its a dead technology.
The contractor is just responsible for generating the power, not managing the grid. That's a problem for Dubai to handle.
I don't read your sig. Why are you reading mine?
hey man mod parent up informative, funny text here text
these are called switching costs
> Dude it's not 1995 anymore
I was figuring it must be 1992; Clinton is running for president and the Democrats are saying all the problems are Bush's fault.
Power goes to negative numbers in pricing as you lose less money at negative cost than you would in shutdown and startup plant costs.
Did the evil democrats turn the school system to shit, leaving you with misconceptions about how the sun and clouds work? :(
What part of the plant being built in the UAE don't you understand? There is no such thing as a lack of demand for electricity there when the sun is up. Have you heard of AC? They have and they love it.
http://economictimes.indiatime...
How it works is you underbid a bunch of stuff, build half of it, then go bankrupt.
It's a proven model.
There's nothing "newsy" about the idea that solar power is most-optimal in arid regions near the equator. But the fact that a form of energy in the most-optimal place for it is as cheap as it is has no bearing on whether it's good as a power source in Scotland or in Minnesota.
This headline is meant to fool idiots into thinking some breakthrough has made solar much more affordable and practical in everytown, anycountry.
It's on-par with a statement that a facility preserving food at the South Pole proves that it's now more efficient to use blocks of naturally-occurring ice to keep food cold than to use a refrigerator.
The current generation of under-30-year-olds are the most-propagandized people in history, nearly all the information they are spoon-fed at school, on Facebook, in television, etc is propaganda designed to manipulate them and served-up by people with strong political ties to special interests. It's really sad to see a free people voluntarily slumping into subservience.
baseload plants are providing excess capacity
Base load plants never provide excess capacity.
Perhaps you should read what a base load plant actually does.
Hint: they provide base load, hence the name. However: I have the sad feeling you don't grasp what I just wrote.
2.99c whether or not there is a demand
We are talking about solar power, obviously it is daytime, obviously there is always demand.
Solar plants never get 0c price as they always provide power when there is high demand. Your reasoning is idiotic.
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
During daytime there is always demand. It is about 100% higher than during night time, or other way around: at night the demand is half of what it is at daytime.
Also, what don't you grasp? We are talking about a single plant here. How can a single new plant produce so much energy that it eclipses the production of the whole country, so that there is no demand?
(*facepalm*)
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
I live in Australia and that is the mecca for the solar power! We use it all the way: in our houses, in the cars, in the streets. That is very affordable and convinient, you only once install the battery or the panel and then get a service from http://servicemy.solar/ - done! Everything works and you pay very low amounts on your bills. That's the future of the world, of the sunniest countries, indeed :)