Carbon Tracker, a London-based think tank, claims that portfolios of renewable energy and storage assets are now cheaper in the UK than new combined-cycle gas turbines, with last year proving the tipping point.
According to a recent study from Carbon Tracker, the cost of building the 6.3 GW capacity mix of renewable energy assets required to replace a 1.8 GW gas generation plant dropped to the same price as the fossil fuel asset in 2020: £60/MWh (€69.93).
According to Carbon Tracker, at today’s prices, solar will play a significant role in such a clean power portfolio, with each 1.8 GW of new gas capacity proposed by the UK government needing 1.7 GW of solar panels as part of the alternative, non-fossil-fuel power mix. Carbon Tracker’s renewable energy portfolio included 1.7 GW of energy storage facilities, which contributed half of the total cost at today’s rates, along with onshore wind generation, demand-response technology, and energy efficiency investment.
Based on an even mix of residential and industrial power users, solar’s low 11 per cent capacity factor–the energy production generated as a percentage of nameplate generation capacity–means PV will contribute about 26 per cent of the electricity needed to replace a gas turbine, dropping to 1% during peak demand times. During peak times, energy storage’s year-round average share of the burden will grow to 39 per cent, with demand-contribution response’s increasing from 20 to 23 per cent and onshore wind’s contribution falling from 18 to 10%.
Because of the energy efficiency investment potential provided by the UK’s ageing housing stock, the contribution from that source will rise from 9% to 27% during the annual peak electricity demand times, which occur in winter. However, Westminster’s inability to deliver on its flagship green home renovation program last year casts serious doubt on the government’s ability to effectively direct energy efficiency expenditure.
The price of a battery
Another BNEF forecast cited in the study is that the capital cost of a four-hour utility-scale battery in the United Kingdom will drop from £220,000/MW (€256,000) last year to £150,000/MW in 2025, and £120,000 in 2030.
Even if the report’s “conservative” forecasts do not come true, the potential for renewable energy facilities to minimize the UK’s carbon footprint and increase energy security is difficult to dismiss.
Resources that have been stranded
Even without factoring in government talk about the need to equip such facilities with carbon capture and storage and hydrogen and methane blending technology, the entire 14 GW new gas fleet planned in the UK up to 2030 still represents a £9 billion (€10.5 billion) stranded-asset danger, according to the study.
The results tend to make a convincing argument for solar and other renewables over the traditional fossil fuel solution, with the study noting a government focus on scaling up offshore wind to bring down costs and on ensuring more energy stability through access to more power interconnectors.
Source – here