EON Invests $9 Billion in Renewables as Germany Drops Nuclear

[jpak]

http://www.bloomberg.com/news/2011-12-15/eon-invests-9-billion-in-renewables-as-germany-drops-nuclear-generation.html

EON AG, Germany’s biggest utility, said it’s investing 7 billion euros ($9.1 billion) in renewable energy projects over the next five years as the country drops nuclear power generation.

EON plans to build at least three offshore wind projects, including the 1 billion-euro Amrumbank West farm in the North Sea, Dusseldorf-based EON said in an e-mailed statement today. Siemens AG, Europe’s biggest engineering company, will supply the the 288-megawatt plant with 80 of its turbines.

“Renewables are a cornerstone of our strategy, and offshore wind is one of EON’s growth areas,” Chief Executive Officer Johannes Teyssen said in the statement. “We intend to commission a new offshore wind farm every 18 months.”

Germany, Europe’s biggest economy, seeks to install 10,000 megawatts of sea-based wind turbines this decade as it raises the share of renewables and phases out atomic energy. Utilities including EON and RWE AG (RWE) are selling assets and cutting jobs to lower costs and boost profit margins as the nuclear exit removes revenue streams.

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[kristopher]

1. Support infrastructure

This is going to go a long way in building the support infrastructure for offshore wind. Which, of course, makes future projects cost less.

[FBaggins]

2. Let's hope so.

$1.3 Billion for 288MW label capacity is pretty steep.

On a per-MWh basis that's like spending $11 Billion on an AP1000... and that ignores the fact that the reactor is designed to last for 60 years and there's little chance than an offshore turbine will last longer than half that long.

[kristopher]

3. Is it?

I come up with an equivalent of $7.8 billion and the wind farm has zero fuel cost, no nuclear waste issues, is financed for 20 years instead of 60 and requires no catastrophic insurance be placed on the backs of the public.

Did you know that Fukushima has wiped out all of the profits ever made by the nuclear industry selling power in Japan?

[FBaggins]

4. That's because you play fast and loose with the numbers.

I'm willing to bet that you selected a capacity factor for wind that represents the latest technology in the best positions... but a CF for nuclear based on some historical global average.

and the wind farm has zero fuel cost,

A negligible factor.

no nuclear waste issues

Nope... but it does have intermittency issues, dramatically higher transmissions costs and a requirement for backup generation, storage, grid upgrades, or a willingness to do without electricity on occasion. None of which (except perhaps part of the second) is included in the quoted price.

is financed for 20 years

Lol! Because you can't finance something for longer than it's expected to survive. Then you shift to financing the replacement (purchased with 20-year inflation-adjusted dollars).

Did you know that Fukushima has wiped out all of the profits ever made by the nuclear industry selling power in Japan?

I rather doubt it. But when did profits become the issue?

[kristopher]

5. Nope???

You wrote, "Nope... but it does have intermittency issues, dramatically higher transmissions costs and a requirement for backup generation, storage, grid upgrades, or a willingness to do without electricity on occasion. None of which (except perhaps part of the second) is included in the quoted price."

Nuclear also has "intermittency issues" and they are of far more consequence than those associated with wind. We can predict virtually all of the outages for wind, they are short lived, and they are of a nature that doesn't cause dramatic shifts in the supply/demand balance of the grid -nuclear outages are sudden and large scale, last days weeks and often years and they cause chaos for the grid operators.

This means that wind actually requires less back-up generation than nuclear. If local wind turbines slow down, the ones down the road are almost always picking up from the traveling breeze. If a nuclear plant blows a valve, scrams and suddenly goes down, you'd better hope that the nearest coal plant has a couple of idled boilers fired up with their generator shafts turning (real spinning reserves of the worst sort) or you are liable to have a major cascading blackout.

Grid upgrades, storage etc are just as problematic with conventional sources as each grid configuration creates such niches and incurs their related costs.

Nuclear waste, nuclear weapons proliferation, meltdowns with concentrated, massive releases of radioactive toxins and skyrocketing costs are the trademarks of nuclear.

How are the Flammanville and Olkiluoto projects coming along? On time and on budget or years behind and massively over-budget?

38 years of nuke profit up in smoke?
Kyodo

...Kenichi Oshima, an environmental economist and professor at Kyoto-based Ritsumeikan University, estimates that Tepco in that time earned just less than ¥4 trillion, possibly equal to or less than the amount it must pay farmers, fishermen, evacuees and others affected by the nuclear crisis.

Oshima also found that the cost of nuclear power generation is higher in Japan than that of hydraulic and thermal power, contrary to a widely disseminated government estimate.

By analyzing Tepco's financial statements, Oshima put its cumulative profits from its nuclear power business at ¥3.995 trillion between the business years of 1970 and 2007, which ended in March 2008. Tepco operates three nuclear power plants — the six-reactor Fukushima No. 1 plant, four-reactor Fukushima No. 2 plant and seven-reactor Kashiwazaki-Kariwa plant in Niigata Prefecture.

The amount of damages Tepco needs to pay is not yet known but is expected to reach trillions of yen. Some financial institutions put the figure at ¥8 trillion to ¥11 trillion.

The cost of power generation per kilowatt hour...

http://search.japantimes.co.jp/cgi-bin/nn20110629a2.html

The numbers used make it appear that the profits from the operation of 17 nuclear reactors over nearly 40 years are about 1/2 to 1/3 of the damages.

Japan has 54 reactors, or about 3X the number studied. Presuming their profits to be similar, that means the meltdowns have wiped out all profitability for the nuclear industry in Japan.

Not going into the incalculable nature of human suffering, I don't believe that the analysis takes into account future decommissioning costs and waste disposal either.

Originally posted at:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=115x302145