Renewables will save us a billion trillion pounds! Yeah, right – Net Zero Watch

Posted: September 15, 2022 by oldbrew in Energy, methodology, net zero, opinion
Tags: , ,

[image credit:]

Until we hear that wind and solar power to generate electricity will be adequate 24/7 without $trillions spent on unfathomably large quantities of batteries, other cost discussions – while obviously important – are of secondary interest. But big numbers may fool some folk.
– – –
Yesterday, the Green media was getting extremely excited about a new paper, which claimed that renewable energy was going to save society millions and billions and trillions of pounds by 2050 (or something like that), writes Andrew Montford.

Ten trillion pounds by 2050 said the BBC.

As readers here know, I keep a close eye on the cost of renewables, and have published papers on both offshoreand onshorewind, showing that the financial accounts of operators in both sectors show no sign of significant cost reductions.

It’s not just me either: my findings closely match those of the energy economist, Professor Gordon Hughes, the energy analyst Kathryn Porter, and an important paper in the peer reviewed literature.

So the idea that renewables are going to save us lots of money is, at first sight, pretty implausible. I decided to take a look at the underlying paper, which comes from the Martin School, at Oxford University.

The methodology is, in essence, extremely crude: it involves extrapolating historic cost trends out along an expected curve (Wright’s law, apparently), while jazzing it up a little with what they call a stochastic methodology, which seems to just generate an uncertainty window.

The latter details are, for the purposes of this post, largely irrelevant, however – it’s all gazing at tea-leaves in my opinion. What interested me was that they were generating predictions of future cost reductions from historic falling cost trends. As already noted, lots of people find no such cost reductions in windfarm accounts (and in fact, I have some limited data on solar, which tells a similar story).

Where are the Oxford Martin team getting this data from? Buried deep in the supplementary information to the paper, I learned that it came from the International Renewable Energy Agency (IRENA). I have been trying to get to the bottom of IRENA’s claims of cost reductions for some time, and recently worked out what I think is the underlying reason.

It’s all to do with the way currency is handled. IRENA’s work is all demoninated in USD (and as a result, so is the Oxford Martin paper).

But the problem of using a single currency is that the final cost figures will be affected by any currency fluctuations. And boy, have there been some big currency fluctuations in the last ten years. In particular, against the dollar, sterling has depreciated by 30%, the Euro by 25%, the Yen by nearly half, and the Brazilian Real by two thirds.

When reporting in USD the costs of operators in any of these places, any reduction of less than these values represents an underlying increase in costs.

Continued here.

  1. oldbrew says:

    NZW: ‘the Oxford Martin School guys have … extrapolated what is, in essence a foreign exchange fluctuation out to 2050 and have concluded that renewables will save the world. Experts, eh?’
    – – –
    And the last time experts saved the world was…??

  2. Gamecock says:

    Smoking cigarettes saves health care costs.

    On average, smoking kills people 20 years younger. End-of-life costs are about the same, but 20 years worth of their health care costs are eliminated.

    Renewables/NetZero WILL save trillions. Dead people require very little.

  3. Chaswarnertoo says:

    GIGO. Warmunism is a crazy religion.

  4. Phoenix44 says:

    To do this you have to know future (i) costs of renewables AND (ii) costs of non-renewables. The chances of this study getting both right are very small. The claim that renewables are going to get substantially cheaper seems very dubious. It’s not clear where what is essentially simple and dated technology can make substantial gains in terms of cost? An analysis of the costs by component and system that showed what is currently relatively expensive would be interesting but they don’t seem to have done that.

  5. oldbrew says:

    Wind also has to replace solar when it’s dark. Not going to happen.

  6. Gamecock says:

    Renewables can never be more than supplemental.

    EVs can never be more than supplemental.

  7. oldbrew says:

    Prices Surge to Record High, Threatening to Push up Expensive EV Costs Even Higher
    Sep 17, 2022

    The price of lithium carbonate, the key material used to make electric car batteries, has continued to skyrocket, tripling in the past year.

    The valuable mineral is mainly processed in communist China, which has a monopoly on the battery market.

    Lithium carbonate prices in China hit $71,315 a ton on Sept. 16, according to data from Asian Metal Inc.

    This has caused a rise in the cost of lithium batteries, which has been increasing due to strong demand and lockdown disruptions at China’s main production hubs.

  8. dennisambler says:

    INET Oxford is an offshoot of the body co-founded by George Soros, with $50 million as a starter. The former chair of the UK Climate Change Committee and former chair of the UK Financial Services Agency, Lord Adair Turner, is a “Senior Fellow”.

    Setting up a branch at Oxford University gives it an air of authority. This what they say about themselves:
    INET Oxford was founded in 2012 as the result of a grant by the Institute for New Economic Thinking (INET), a New York based philanthropic organisation that was created in the wake of the 2008 Global Financial Crisis to promote innovative, policy relevant economic research.

    Funding partners include Gates Foundation, Rockefeller Foundation, Open Society, (Soros again).

  9. oldbrew says:

    SEP 16, 2022.
    Is Denying People Access To Affordable Energy The New Normal?
    – – –
    Not quite, but energy *saving* deals for smart meter users may have unpleasant surprises in store…

    In Colorado, energy demand peaked on August 30 due to soaring temperatures. The Epoch Times reports that “more than 22,000 Xcel Energy customers in Colorado were greeted with the message ‘energy emergency’ on their smart thermostats, preventing them from reducing the temperature below 78 degrees.”

    Xcel said that this affected only customers who signed up for a special rewards program that gives cash incentives to consumers, who are free to opt-out of it.

    While the voluntary nature of the program makes it less than authoritarian, the mindset of our energy masters is unsettling, nonetheless. [bold added]
    . . .
    Maybe the rewards will pay for a few hand-held fans.

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