New Plant Electricity Cost - Natural Gas versus Coal, Nuclear, Wind, Solar

My Note that Natural Gas costs are currently 1/2 of the cost quoted in the above!

From: http://www.investorvillage.com/smbd.asp?mb=4288&mn=92281&pt...

NatGas vs Coal

Been lots of discussion about the all-in costs of dry shale gas wells and how their output will be required to meet demand.  That cost sets the long-term bottom-line price, but market price is set by competition.  While we wait for GTL, transportation and LNG exports to ramp, the competition is primarily coal.  Interesting article link below.  She summarizes on natgas vs coal:

 "Let’s briefly review the advantages of natural gas over coal for electricity generation:

 

§           Cost: Even at $5/Mcf, gas costs half as much per KW-hour as coal

§           Pollution and CO2: Gas already meets new EPA standards

§           CO2: The latest gas generators produce 1/3 the CO2 of the best coal plants

§           Capital cost: Gas power plants are 2.8 times cheaper than coal plants per KW

§           Lead time: Gas plants can be permitted and built in half the time"

 

                       

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Permalink Reply by time will tell on May 4, 2012 at 6:10am

Jack , this is very good news , I only see one problem ,,,  what am I going to due with my coal fired cell phone

now ?

Thanks for the post JS .

Permalink Reply by Dan on May 4, 2012 at 6:31pm

Here is a plant going online next year

http://www.usa.siemens.com/energy-efficiency/energy-efficiency.html...

Energy-efficient fossil power

Growing global energy demands put pressure on both the supply and the prices of oil, gas, and coal. As fossil energy sources are an important part of maintaining a stable energy network in the U.S., it is crucial to use these resources in a sustainable manner.

Gas turbines, combined cycle power plants, and combined heat and power plants all contribute to energy efficiency in fossil power generation. A wide range of gas turbines supplied by Siemens are used in gas power plants, steam power plants and combined cycle power plants. With a capacity of 375 megawatts, the company has produced the world's most efficient gas turbine. Siemens will supply two gas turbine packages for the Mississippi Power Company which will be installed in a coal-fired integrated gasification combined cycle (IGCC) power plant in Liberty, Mississippi. Approximately 65 percent of the turbines’ CO2 emissions are expected to be captured. 

The most powerful gas turbine increases efficiency.

In El Segundo, California, Siemens is constructing the first two Flex-Plant 10 combined cycle power islands for the U.S. power company NRG Energy. The project offers an environmentally compatible solution that has extremely short startup times and is low on startup emissions and water usage. As soon as the plant goes online in the spring of 2013, it will be able to supply environment-friendly power to as many as 240,000 households.

Combined heat and power (CHP) plants are among the most efficient energy production methods, simultaneously converting fuel into both electrical energy and heat, usually in the form of steam and hot water. With a fuel efficiency of more than 90 percent, these plants are perfectly attuned with our energy conservation philosophy

Permalink Reply by Chartist on May 5, 2012 at 3:22am

I have a problem with those numbers as they don't match what I've seen.  And I listened to another so-called expert on Bloomberg who said if the electricity generators suddenly switched to nat gas only, the price would shoot up to $20 per MCF...everyone has an agenda.....We need an LNG export terminal on the east coast.

Permalink Reply by Moe on May 5, 2012 at 3:57am

It would be helpful to see a comparison between the energy source cost component of power produced from coal versus natural gas. It seems to me that there are a number of variables relative to the cost of designing, permitting,  building, and operating either of the two fossil-fuel-based power plants that do not fit into a comparison of the costs of the source of the energy. Further, there are significant differences in the activities associated with the production, transportation, and handling of coal versus natural gas and they are not a function of the unit cost of those resources.

 

In order to have a truly fair comparison of the costs of power generation from the various sources of energy currently being used, it seems to me that one would have to develop a complicated model based upon all of the costs, both initial and long-range, that would be incurred during the life of the producing unit. I have read several detailed analyses of certain aspects of different power generation facilities. There seems to be much speculation regarding the true cost of the renewables, i.e. wind and solar, on account of uncertainty regarding the real life of some of the components and the cost to replace or maintain them for a term that is comparable to that for fossil-fuel-based units.

Permalink Reply by Chartist on May 5, 2012 at 4:13am

wikipedia has provided a decent comparison....It's worth googling.

Permalink Reply by Jack Straw on May 5, 2012 at 10:18am

I am not defending the numbers, only presenting data from the US-EIA.

A comparison for the various potential sources of electricity is indeed a complex one, dependant upon various assumptions - and the validity of such a comparison is dependant upon the ultimate accuracy of those assumptions.

It should be noted that the cost comparison presented was for new build construction, not for existing plants. The significantly lower costs of constructing and maintaining a new build Natural Gas facility skew the numbers in favor of Natural Gas (in spite of the fact that some of the other "fuels" might be cheaper in operation). 

The comparison would be for new Coal Plants (built to stringent new requirements) versus Natural Gas, Nuclear, etc.

Existing Coal Plants can produce electricity more cheaply than existing Natural Gas generation.

As existing Coal powered plants reach the end of their engineered life, choices will have to be as to the nature of their replacement. Some of the factors going into making a decision will be outside simple economics: environmental, footprint, placement, ability to source near consumers, etc.

Also, the numbers presented were for baseload plants; Natural Gas Turbines are an excellent source of electricity when the need arrises for extra useage - extra hot summer days, extra cold winter nights, Super Bowl TV's. Natural Gas Peaker Turbines can set in the corner of a coal plant. 

 

All IMHO,

                 JS 

Permalink Reply by Mud on May 5, 2012 at 4:15am

Who is paying $.11 /KW? Current prices through First Energy are something like $.0685/KW.  Maybe as high as $.0729 if memory serves. So the chart above seems to be skewed upward a bit on pricing.  Or am I missing something?

Permalink Reply by Moe on May 5, 2012 at 6:08am

Mud,

That is evidently an average over the country. I live in NM and pay an average of $.11+/kWh.

Permalink Reply by Robert P Magyar on May 5, 2012 at 10:19am

Jack, too simplistic a view.

Solar produces the cheapest and most abundant electricity during peak energy demand in the summer, think of all that AC going all day long during the summer and in particular, during those nasty heat waves.

Electric utilities love to present their cost structure in terms of non-peak periods when they their baseline cost to operate is on or about 4 cents per kWh. What they will never tell you is how much it costs for them to buy power during peak loads out on the open market as in 50 cents kWh or more.

 

Solar may be interriment but in true apples to apples cost analysis, its cost today is at grid parity. It does not pollute the air, poison the water or make any and all things radioactive. But as those of us who know, a given  energy source  supporters always has its own agenda to appear better than the other guy's energy source.

The facts are this country needs all the energy it can put its hands on for the future health of the economy.

 

Best, Bob Magyar

Permalink Reply by Jack Straw on May 5, 2012 at 10:53am

RE: “Solar produces the cheapest and most abundant electricity during peak energy demand in the summer”

What about during those short days of the cold damp PA winters, and during the long cold (dark) winter nights?

We need a dependable source of electricity.

If Solar, is the way to go - why does it always require huge taxpayer subsidies?

Even in the Mojave Desert, where the Sun (almost) always shines, it requires huge taxpayer subsidies. No one would consider attempting a Solar Farm without taxpayer subsidies or Government loan guarantees.

If Solar is so economic, why are Solar companies going bankrupt on an almost weekly basis.

 

RE: “Solar may be intermittent but in true apples to apples cost analysis”

There can be no “apples to apples” comparison – one is 24/7 baseload, the other is intermittent, dependent upon the Sun shining.

Solar can potentially make a serious contribution in such places as the deserts of CA, NV, NM, AZ; where vast areas of Government land are available for Solar Farms; where there is intense daily sunshine.

Solar is a tougher sell in the vast expanses of Rhode Island, New Jersey, Delaware and Maryland. Solar is a tough sell in rainy foggy Oregon and Washington.

 

RE: “Electric utilities love to present their cost structure in terms of non-peak periods when they their baseline cost to operate is on or about 4 cents per kWh. What they will never tell you is how much it costs for them to buy power during peak loads out on the open market as in 50 cents kWh or more.”

With Natural Gas Peaker Turbines, no need to purchase electricity on a secondary market – flip the switch and fire up that turbine. The purchase of peak electricity at “50 cents kWh or more” should only occur where you have morons running things (California, NY, IL).

Anyone who thinks that “Solar and Wind” is the answer has likely been out in the Sun too long (without a hat) or eaten too many bean burritos.

Bob, way too simplistic a view.

 

All IMHO,

                    JS

 

Permalink Reply by Moe on May 5, 2012 at 11:15am

Thanks Jack,

 

Well stated. Just what I was thinking as well.

 

Also, there are many very negative environmental consequences to flora and fauna with both solar and wind, which are blindly and hypocritically ignored by the very groups who scream the loudest regarding intrusive activities by the 'perpetrators' of whatever activity they oppose.

Permalink Reply by Jack Straw on May 5, 2012 at 12:08pm

There are several environmental issues regarding both Solar and Wind that I have never seen or heard discussed.

When sunlight impacts the surface of the Earth, some of the energy becomes heat that warms the soil and some of the heat is re-radiated to the air and some of the energy is reflected back into space (the amount reflected depending upon surface albido). This greatly controls our Climate; contributing in many ways; evaporating water, creating clouds, rain, helping generate winds, etc.  All of this courtesy of the Law of Conservation of Energy and the First and Second Laws of Thermodynamics.

Since Solar Farms interdict and capture energy that would otherwise locally contribute to Climate; the capture of this energy will necessarily alter local climate. Any large scale alteration of the local Climate will “ripple” through the entire Climate. Solar Farms can alter the environment, perhaps in ways not yet understood – and perhaps in ways harmful to many “downwind”.  

Likewise, Wind Farms capture wind energy and directly convert this to electrical energy that is exported elsewhere. Wind Farms likewise would alter winds that contribute to our Climate.

While many that vocally express their concern about “Climate Change” voice their support for Solar and Wind, they seem to ignore the potential for Solar and Wind to contribute to “Climate Change”.

 

To the “Law of Conservation of Energy and the First and Second Laws of Thermodynamics” we can add “The Law of Unintended Consequences”.

 

All IMHO,

                     JS

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