Just as natural gas has beaten coal in less than five years,
solar power is already beating gas,
so betting on LNG exports or even fracked methane
for domestic power is a bad investment.
These are some implications of a new Citi GPS report.
The switch from gas to solar is already happening in Germany
and in the U.S.,
according to Citi GPS in
Energy Darwinism: The Evolution of the Energy Industry,
October 2013,
page 9:
…moreover, solar steals the most valuable part of electricity
generation at the peak of the day when prices are highest. This
effect has already caused the German utilities to release profit
warnings, with some gas power plants in Germany running for less
than 10 days in 2012, all of which makes some utilities reluctant to
build new gas plants given fears over long term utilisation rates
and hence returns.
And not just in Germany; see page 84:
This is not a ‘tomorrow’ story, as we are already seeing utilities
altering investment plans, even in the shale-driven U.S., with
examples of utilities switching plans for peak-shaving gas plants,
and installing solar farms in their stead.
Wind is also beating coal; page 9 again:
Wind is already overshadowing coal in the second quartile. While
wind’s intermittency is an issue, with more widespread national
adoption it begins to exhibit more baseload characteristics (i.e. it
runs more continuously on an aggregated basis). Hence it becomes a
viable option, without the risk of low utilisation rates in
developed markets, commodity price risk or associated cost of carbon
risks.
By no “commodity price risk” they allude to wind requiring no fuel.
And that’s also true of solar, as they spell out on page 90: Continue reading Solar learns faster than any other energy source –Citi GPS →
Opposition to the Sabal Trail pipeline may be having more widespread effects.
The same day
FERC told Sabal Trail to pay attention to karst limestone sinkhole opposition,
Duke announced it wasn’t going to “modernize” that plant.
Two days later,
Sabal Trail told one of that opposition that it was considering
moving its Suwannee River crossing upstream, that is, away from Duke’s
Suwannee Plant,
Coincidence?
