The Speculist: Cheaper Than the Grid


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Cheaper Than the Grid

Electricity is the ultimate commodity. Whether it comes from a coal burning plant, wind mills, or from a hydroelectric plant; an electron is an electron. When powering your toaster, one is as good as the next.

This commodity problem - from the point of view of those who are producing power - is compounded by the fact that customers can't choose where their power comes from. If you'd rather your power came from a clean source - well, tough. You don't get that choice. If you're on the grid your electricity could come from basically any source anywhere in the country - clean or dirty.

Power sources compete on one basis - price. And, unfortunately, environmental impact is a cost that usually falls outside of price. There are a couple of ways out of this trap. We could tax dirty power. But, right or wrong, we've usually lacked the political will to put the cost of environmental impact back on the energy consumer.

The less painful way out is to find ways that clean power can compete with dirty power on the basis of price. Putting filters on smoke stacks can't do that. Any effort to clean up a dirty process makes that power more expensive than the dirty original - just like taxing. We need entirely different clean power sources.

Hydroelectric power is cheap and clean, but we've basically maxed out on that in this country. Wind power can compete with grid power on the basis of price and this resource has not been fully exploited; but there is a limit to the amount of power that the wind can provide.

There are two more cheap and clean sources of electricity that I read about just today. First, the Nanosolar Company has begun selling new advanced solar panels that are actually cheaper than grid power.

The company, which has raised $150 million and built a 200,000-square-foot factory here, is developing a new manufacturing process that “prints” photovoltaic material on aluminum backing, a process the company says will reduce the manufacturing cost of the basic photovoltaic module by more than 80 percent.

Nanosolar, which recently hired a top manufacturing executive from I.B.M., said that it had orders for its first 18 months of manufacturing capacity. The photovoltaic panels will be made in Silicon Valley and in a second plant in Germany.


Nanosolar’s founder and chief executive, Martin Roscheisen, claims to be the first solar panel manufacturer to be able to profitably sell solar panels for less than $1 a watt. That is the price at which solar energy becomes less expensive than coal.

“With a $1-per-watt panel,” he said, “it is possible to build $2-per-watt systems.”

According to the Energy Department, building a new coal plant costs about $2.1 a watt, plus the cost of fuel and emissions, he said.

Another possibility is the mini-nuclear plant. Phil mentioned these in a recent Better All The Time entry. But Glenn Reynold's link today points to an article with this fact about mini-nuclear plants:

The whole process is self sustaining and can last for up to 40 years, producing electricity for only 5 cents per kilowatt hour, about half the cost of grid energy.

We may live to see dirty power plants mothballed for the most practical of reasons - the price.



I'll forgo the jet pack and the flying car- though I really want both- if I can get my electric car. And my balanced, nutritional meal in a cookie.

How about a balanced, nutritional meal in a box of cookies? You know, a small box. Think Girl Scouts.

One of the great implications of the port-o-nuke is that we can all finally have our nuclear powered yachts! (Of course, you still have to be able to afford a yacht...)

"And my balanced, nutritional meal in a cookie."

You wouldn't want it. I've had those cookies and they taste terrible.

The electric car depends on finding a more powerful battery or some other kind of storage device and those are on their way. Also, increasing electrical generation capacity to transition from a gasoline to grid-powered transportation system.

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