The clean Green energy fiasco has reached a new level of incompetence and waste.
Totally Wasted Wind Power
Bloomberg reports UK Is Paying £1 Billion to Waste a Record Amount of Wind Power
Burgeoning capacity and blustery weather should have driven huge growth in output in 2024. But the grid can’t cope, forcing the operator to pay wind farms to turn off, a cost ultimately borne by consumers. It’s a situation that puts at risk plans to decarbonize the network by 2030 and makes it harder to cut bills.
Crucial to the net zero grid target is a massive build-out of renewable power, particularly from wind. Britain has boosted its offshore fleet by 50% in the past five years and is set to double it in the next five, Bloomberg data show.
But the grid hasn’t expanded at the same pace. As a result, the operator is increasingly paying wind farms, particularly those in Scotland, not to run. So far this year, the UK has spent more than £1 billion ($1.3 billion) in “congestion costs” to turn off plants that can’t deliver electricity because of grid constraints, and switch on others.
Last month for example, when Storm Bert swept across the UK, some of its newest and biggest wind parks were still. Scotland’s £3 billion Seagreen project, owned by SSE Plc and TotalEnergies SE, was shut off. SSE’s Viking development on the Shetland Islands was also closed.
Wind vs Gas
UK generators usually sell output in advance on the wholesale market. But those transactions don’t take into account the physical limitations of balancing supply and demand in real time. To keep the lights on, the operator steps in, paying some plants to turn off and others that are closer to demand centers to fire up.
Often, this means shutting off a far-flung wind farm and starting up a gas-fed plant that’s closer to a city.
Absurd Setup
“It’s absurd that Britain pays Scottish wind farms to turn off when it’s windy, while simultaneously paying gas-power stations in the south to turn on,” said Clem Cowton, director of external affairs at supplier Octopus Energy Group.
I don’t believe we need an energy director to diagnose the complete absurdity of this arrangement.
Which of These Headlines Are Real?
- Southern Wife Arrested for Failing to Serve Drinks in Mason Jars
- UK Pays Wind Farms $1.3 Billion to Shut Down When It’s Windy
- FBI Warns Kash Appointment Could Jeopardize Efforts to Not Release Epstein List
- Trump Renews Relations with Castro Regime
It is sometimes very difficult to distinguish between real and fake headlines.
In the above list, only number 2 is real. The others are from the Babylon Bee.
Wind Losses Are Huge
- General Electric (GE): GE’s offshore wind business expects to lose about $1 billion in 2023 and 2024. This is due to a number of challenges, including:
- Inflation
- High interest rates
- Supply chain bottlenecks
- Rising costs for components
- Siemens: Lost nearly $1 billion on wind last year
- Vestas: Saw an operating profit decline of 369%
- Increased costs: Commodity prices, including for steel and copper, have increased, as well as construction and operating costs
- Regulatory process: The regulatory process takes about six years, while other countries are building projects at a faster pace
- Lawsuits and disinformation: Lawsuits from advocacy groups and disinformation campaigns from astroturfing groups have slowed development
The above was AI generated.
Offshore Wind Projects
Image is from the US Energy Information Agency, EIA article Cancellations Reduce Expected U.S. Capacity of Offshore Wind Facilities.
The amount of offshore wind generating capacity that is under construction or planned in the United States is in flux after two projects in New Jersey were canceled last year. Of the 7,200 megawatts (MW) of capacity reported in May in EIA’s latest Preliminary Monthly Electric Generator Inventory, projects totaling about 2,400 MW have been canceled since last December while others totaling 4,800 MW remain active in various stages of development.
Cancelled Projects
- In late 2023, developer Orsted canceled the 2,400-MW Ocean Wind 1 and 2 projects in New Jersey, citing rising interest rates, high inflation, and supply chain delays.
- In January, Orsted withdrew from commitments to the Maryland Public Service Commission to build the Skipjack 1 and 2 projects, totaling 966 MW, but is still continuing with advanced development and permitting.
- Late last year, the developer of the 20-MW Icebreaker Wind project on the Ohio coast of Lake Erie halted the project amid rising costs and loss of funding.
Jones Act Impact on Offshore Turbines
Trump should Kill the Jones Act but will he?
Another significant hurdle for offshore wind development in the U.S. involves a century-old law known as the Jones Act.
The Jones Act requires vessels carrying cargo between U.S. points to be U.S.-built, U.S.-operated and U.S.-owned. It was written to boost the shipping industry after World War I. However, there are only three offshore wind turbine installation vessels in the world that are large enough for the turbines proposed for U.S. projects, and none are compliant with the Jones Act.
That means wind turbine components must be transported by smaller barges from U.S. ports and then installed by a foreign installation vessel waiting offshore, which raises the cost and likelihood of delays.
Trump failed to kill the Jones Act in his first term. Will he do so now?
Because of the Jones Act, the US has the highest shipping costs in the world.
Dear DOGE, please look into this. It’s a high-priority item for reasons other than turbines.
Wind Turbine Average Price of Key Critical Materials
The Biden administration set a goal to install 30 gigawatts of offshore wind capacity by 2030. Bloomberg reports the actual number will be closer to half that.
Bloomberg: “As the price of construction climbs, developers are rapidly revising their plans — at great cost.“
Material costs have risen, labor costs have risen, the cost of money has shot up, and opposition to projects has risen.
Cancellations show these projects, at least the offshore ones, are hugely unprofitable even with big subsidies.
Has anyone truly factored in the mineral costs, concrete needed, and environmental impacts on birds and marine life, especially whales?
Mish Economic Rule
Except in cases of genuine national security interest, if a project cannot post a profit without subsidies, then it is not economical and should not be undertaken.
Wind turbines are not a national security item. Thus, developers should proceed at their own risk, not US taxpayer risk.
Dear DOGE request #2. Please cancel all subsidies.
Addendum
Speaking of fiascos with much more economic and global trade implications, pleased see my post: China Halts Rare Exports Used by US Technology Companies and the Military
Thus, Trump’s 50 percent tariff threats on China will do one of two things, perhaps both: Block all rare earth exports from China or start WWIII.
Good luck with that.
Oh, I forgot to add: Trade wars are good and easy to win.
Jones act should be waved for wind install. They waive it all the time. To outright repeal it is economically and strategically insane. Need to have other approaches to boylster US shipping. Like amending the US build requirement. Every reasonable country has cabotage laws.
Jones act is idiocy and should be scrapped
“However, there are only three offshore wind turbine installation vessels in the world that are large enough for the turbines proposed for U.S. projects, and none are compliant with the Jones Act.”
Clearly, the Jones Act failed to do what it was meant to do, which was making sure that the US kept building their own ships for whatever purposes they were needed. It would be better if the US tried harder to build their own ships, but if that isn’t happening, maybe the Jones Act will have to go.
If people really wanted to reduce polution and co2 emissions we would go nuclear. New reactors are SO much safer, can’t melt down, we can use breeder reactors and what not to use spent fuel so there is very little waste. However environmentalists are scared of even the word nuclear, and the government as over regulated the Nuclear energy industry to the point where it is pointless to even attemp to build a plant anywhare in the USA. Its too bad, because it is cheap, reliable, baseline, no pollutions, and the tech is already available.
It takes so many hydrocarbons to create just one windmill, they could spin until they fly apart and would NEVER re-coup the loss and cost it takes to manufacture and poor football fields worth of concrete that when obsolete NO-ONE will want to pay the trillions of dollars to dismantle them, the billionaires invest, run the scam for a while and then abandon all, to leave it to the people to clean up their mess. This is Ostriches, emu’s all over again, it’s all just another scam to make millions more for them and leave the shit show to us to deal with.
This is why we need bitcoin mining. The miners can power up when the wind is blowing and utilize all that surplus electricity, and then power down when the wind stops blowing.
Yep. This is common practice throughout the world. Paying to not produce, or slow production of something that isn’t needed at that moment. Or to grow production. Nothing new to see here.
Take US farming. 30 billion a year to subsidize production, stop production, destroy production, change production etc.
Or oil and gas. Just one example: The Canadian govt spent 34 billion to take over and complete the TMX pipeline because private companies backed away. Considering how “green” the govt there tries to be, that is interesting. Subsidies are everywhere.
Face it folks. We all want and need more energy. The entire world wants and needs more energy. We cannot grow our economies or our standards of living without more energy. And that energy production comes with costs.
Unlike many here, I am not an energy snob. I don’t care if the energy comes from fossil fuels or renewables. I say build them all. And, of course, build out the electrical grids, and energy storage facilities as well. Then we will waste less renewable energy.
Though we will always waste some energy; whether fossil or renewable. How much energy is wasted annually in oil and gas? Oil spills alone cost over $10 billion per year. Add in pipeline and refinery explosions and flaring. And the cost of all those emissions! At least we got rid of lead in gasoline. And, of course, internal combustion engines are only 20-25% efficient, so they waste 75-80% of their energy as heat. Anyone want to calculate how much that costs?
Currently, in the US we are running into an electrical energy shortage (thank you data centers, AI, EVs, Crypto etc). The fastest way to meet that growing need is to build new natural gas plants, solar farms with storage, and onshore wind with storage. But we also need to expand and harden our electric grid infrastructure, and expand our natural gas pipelines. Will government subsidies be involved? Of course.
TY!
Always full of valuable information, and articulated well. I do enjoy your post Papa. I do wish You and Mish would have a debate (mentioned before)! I think it would be worth the time and effort, and definitely worth enjoying, from an outsider…
The problem is that BATTERY TECHNOLOGY has not kept pace with the changes in modern times.
If we had reliable, cheap, large-scale batteries, we could shunt off and save some of the peak-time energy that gets generated, rather than idling plants and having waste. But the engineers have failed to create a new battery paradigm. This one is on them, not the governments of the world, which are only trying to cope with an unprecedented (climate) situation.
You can read more of my writings by going to: dark . sport. blog … on the net.
At one of my previous jobs, my new officemate told me, “A manager’s job is to figure out what his subordinates are doing, and stop them.” Engineers know what to do, but the management team won’t listen when told something is not feasible, will cost more, will take more time, and is not safe.
China is leading the way by adding a lot (25 GW) of energy storage using LFP (lithium, iron, phosphate) batteries this year. Expect this number to grow rapidly. The US is adding roughly half of that this year (mostly in Texas and California).
I see lithium and think fires, but I’m probably listening too much on that topic right? Otherwise I question using it in newer technology. I assume the bugs, so to speak, have been figured out?
“Dear DOGE request #2. Please cancel all subsidies.”
This would *easily* bring CPI inflation below the 2% target, and would likely result in (net beneficial) CPI deflation.
You would “Cancel” the Government, as that is what they “Run On” as they make no money themselves.
I know, a good idea possibly, right? We Need Government (did I say that?), but good Government looking out for America and it’s Citizens!!!
Who would have thought that just now there would be too much wind-generated power for the grid to handle? Wow.
People, including Greens, have known for a long time about the opposite. The obvious solution, particularly to the Greens, is demand destruction, and also load-shedding.
On the related point, the obvious solution to too little renewable energy generated is not back-up fossil fuel baseload. It is the Bolivian solution of load shedding. You make hay when the sun shines, and do something else – maybe twiddle thumbs – when it doesn’t. (Hardly any homes in Bolivia have heat. Up on the altoplano where the daily high temperature is in the 60s people dress in layers, all the time.)
Can you delete this guy Mish
The wind farm operates at wind speeds of about 7–11 miles per hour (mph) and 55–65 mph.
At higher speed the controller shuts off the wind farm to avoid damage.
yeah I mean Mish is exposing his lack of engineering understanding, or being a bit disingenuous. to keep it simple – the insides get too hot and break more and the heat itself makes the transmission of power less efficient due to increased impedance.
Environmentalists would tell you that this is a non-issue because you can ‘just set up grid storage’. The reality however is that grid storage, especially for large amounts of energy and/or extended periods of time is an insanely expensive endeavor and when it’s taken into account it can easily make a renewable project non-profitable.
Are Pumping Energy Transfer Stations the solution of all such problems ?
Pumped hydro might be the only viable energy storage mechanism that could handle the scale of energy being “thrown away” in this situation. However, it does come with its own issues, like siting challenges, cost, water availability, long construction times, environmental permitting, etc.
gravity sails man…
Solar panels work exactly as intended. Politicians advocate for them using tax dollars. Politician then gets large home with no solar panels. What’s the issue?
Mish, I like your ‘Mish Economic Rule’ generally, but its simplicity does not apply as well for energy production.
Direct energy consumption is not a simple profit-maximizing enterprise because consumers generally are held captive with only one electricity source. So throughout most of the US, electric utilities are governed/ruled/limited by government/society. Otherwise your Utah mountain neighbors would be paying astronomical prices from that local profit-maximizing utility company in the winter to heat their homes or die.
So utilities get to make a profit, but not the ‘maximum possible’. So that’s also a major reason why government/society should get to have some say in how electricity is produced because it’s protecting utility-consuming citizens that have no real choice about how they get their electricity. Of course, that could also run into political ideology issues. But if you let the market completely rule here, most US citizens would be at the mercy of a single utility company and I doubt very few people really want that.
How can you have an operating profit decline of 369%? Isn’t that a net loss?
A simple decimal point can fix it, otherwise Vestas would be in BIG trouble.
Yes, a decline over 100 percent is considered negative, as it means the value has decreased by more than its original amount,
Blow or no blow, the following is more of a concern, and will most likely spread:
South Korea president declares emergency martial law | CNN
The president of South Korea sounds like Kier Stalin the dear leader of Airstrip One.
SPAM
Was just reading about California solar farms not outputting at capacity, in part due to the grid system not being able to handle the increased load. Leftists have this thing where they just create a law and it is just supposed to work as advertised, with no adverse consequences. Today, Nathan Hochman takes over for Soros D.A. Gascon, who managed to make a mess of the L.A. County justice system.
This is too simplistic of a response about “leftists”.
New energy production is a chicken-or-the-egg conundrum. There’s no need for expansion of grid infrastructure first without new energy production coming online. But if you make the new energy production first, there’s going to be a backlog of energy until the ‘secondary’ grid infrastructure gets built.
This is somewhat of a problem with any new energy production, including coal or gas. But it’s especially an issue with renewables because they are usually located in a place away from coal and gas energy production, so less current grid infrastructure (and more potential expansion problems)
It’s also a particular problem for wind & solar, since they are not consistent. Battery storage at scale is not currently feasible, so base load has to be provided by another, more reliable source, and you need extra grid capacity.
The problem with many laws is that they are not reassessed. Many times, the policy needs to be changed for the circumstances or cancelled. This is called lazy governance.
It’s not the flow of the wind that’s important.
It’s the flow of the cash.
In December 2022, the UK’s problem was no wind at all. A giant doldrum encompassed the British Isles. They’d been cut off from Russian gas and their windmills were motionless.
It’s almost like wind isn’t a reliable source of energy.
it’s a reliable source of income for those involved in installing them.
Wind and solar curtailments are logically the same as oil and gas flaring.
You could build the infrastructure to offtake all of the output, but it’s cheaper and easier to throw a little away.
Choosing to get wound up about one or the other (rarely both) is a political decision. Neither is actually particularly interesting.
Flaring gas is not the same thing. If you see flaring then something isn’t working properly and the private energy company is taking steps…they do not want to be flaring.
And at billions of waste on both the subsidy side and then the consumer overpaying because the builder that received the subsidies needs to not produce is doubly wasteful and IS particularly interesting. If wasting billions isn’t interesting to you I hope you’ll pick up the tab for those that find it interesting…you’ll then be interested too, right quick.
Again, not sure why people take the side of waste in any circumstance as a political defense mechanism. The concept of waste should be abhorred by all, all the time.
‘Waste’ should be ahborred, but opportunity cost is the better measure of waste.
I think vboring’s comparisons are relevant. Flaring gas IS actually a regular occurrence (and “working properly”) and is actually OK’ed by government regulatory/permitting agencies to both burn off pollutants at refiners and to reduce pressure/danger at production rigs. So natural gas is being ‘wasted’ but it’s currently cheaper (lower opportunity cost) than trying to capture every bit of the natural gas for consumption.
And citizens pay for that indirectly because less gas is captured and used, natural gas prices are thus indirectly affected upwards, and utility companies are allowed to pass that on (through public service commissions) to utility consumers.
Wind energy is definitely different than coal and gas-produced energy. But it’s pricing structure is also similar. When there’s ‘too much’ wind energy, some of it has to be siphoned off (in Mish’s example, thru payments to shut them down), so yes there’s an opportunity cost and price to consumers.
BTW, there could also be ‘too much’ wind energy because a fossil fuel producer is simultaneously using the same transmission lines. But it may cost more to have that fossil fuel producer power down than the wind turbine. But would you be as upset if the coal producing electric utility was paid money to shut down instead? (Some coal-using electricity is also wasteful and costly because a base load must be maintained at all times)
Major Major is in his office now. You will have to wait. Major Major has left his office through the window, you may go in an see him now. — Catch 22
Yes! Make subsidies illegal. Do we still have subsidies on electric vehicles?
In other news, we just keep on winning. Mexican president breaks up two migrant caravans headed to the US after Trump threatens tariffs. And the bitch had denied she would bend the knee, lol.
Canada no longer welcomes mass immigration after Trudeau meets with Trump, cautioning asylum seekers that making claims will now be difficult. Just keep on winning.
A disproportionate share of the immigrants have been going to Toronto and Vancouver for decades. Housing has been very expensive in these two cities for years.
Are you SURE fake headline # 1 is fake? I live in Alabama and have a need to know. Also, saw sad story /pic while in London- a raptor was held up, dead, wing sliced off by the wind turbine in the background. The Telegraph. Right next to this story was that of a woman pensioner, fined 500 pounds because she left a sack of donated neatly folded clothes at the base of the too full receptacle. Something about the juxtaposition of these two stories seems fitting. Out of control / ill conceived gov’t/regs.
We will never forget 12/1/24. Never
Personally, I remember the date I got married and when my children were born.
So I genuinely feel sorry for you feeling the ‘absolute’ need to use mental energy for the rest of your life to remember one political announcement.
But your neurosis does not affect me personally. So have at it. I wish you a better future
How To Remember Just About Anything Complimentary Workshop | Dale Carnegie
Why? Is it your birthday?