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Power

Giant Batteries Drain Economics of Gas Power Plants (reuters.com) 188

Batteries used to store power produced by renewables are becoming cheap enough to make developers abandon scores of projects for gas-fired generation worldwide. Reuters reports: The long-term economics of gas-fired plants, used in Europe and some parts of the United States primarily to compensate for the intermittent nature of wind and solar power, are changing quickly, according to Reuters' interviews with more than a dozen power plant developers, project finance bankers, analysts and consultants. They said some battery operators are already supplying back-up power to grids at a price competitive with gas power plants, meaning gas will be used less. The shift challenges assumptions about long-term gas demand and could mean natural gas has a smaller role in the energy transition than posited by the biggest, listed energy majors.

In the first half of the year, 68 gas power plant projects were put on hold or cancelled globally, according to data provided exclusively to Reuters by U.S.-based non-profit Global Energy Monitor. [...] "In the early 1990s, we were running gas plants baseload, now they are shifting to probably 40% of the time and that's going to drop off to 11%-15% in the next eight to 10 years," Keith Clarke, chief executive at Carlton Power, told Reuters. Developers can no longer use financial modelling that assumes gas power plants are used constantly throughout their 20-year-plus lifetime, analysts said. Instead, modellers need to predict how much gas generation is needed during times of peak demand and to compensate for the intermittency of renewable sources that are hard to anticipate.

The cost of lithium-ion batteries has more than halved from 2016 to 2022 to $151 per kilowatt hour of battery storage, according to BloombergNEF. At the same time, renewable generation has reached record levels. Wind and solar powered 22% of the EU's electricity last year, almost doubling their share from 2016, and surpassing the share of gas generation for the first time, according to think tank Ember's European Electricity Review. "In the early years, capacity markets were dominated by fossil fuel power stations providing the flexible electricity supply," said Simon Virley, head of energy at KPMG. Now batteries, interconnectors and consumers shifting their electricity use are also providing that flexibility, Virley added.

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Giant Batteries Drain Economics of Gas Power Plants

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  • As I understand it -

    At present Gas plants have two purposes - the first is baseload generation when the renewables can't keep up. That's a lot of work, but it isn't very profitable. The second is maintaining grid stability, keeping the grid frequency at 50 or 60 hertz, second by second. The gas plants were earning a lot of their money doing the first, just keeping their massive turbines spinning but not generating power - but that is a job that batteries can do a lot better. Batteries and their attached inv

    • The gas plants were earning a lot of their money doing the first, just keeping their massive turbines spinning but not generating power - but that is a job that batteries can do a lot better.

      It is this spinning of gas turbines that aren't producing power that are called "spinning reserve" or "operating reserve".
      https://en.wikipedia.org/wiki/... [wikipedia.org]

      Whether batteries can do "a lot" better would be something I believe is debatable. They may be able to keep the grid frequency closer to the ideal 50 or 60 Hz but just how critical is it to keep the grid inside that ideal? Certainly getting too far from that ideal would risk damage to turbines but with enough turbines on the grid already spinning it is

      • by Geoffrey.landis ( 926948 ) on Wednesday November 22, 2023 @11:00AM (#64024271) Homepage

        The 19th century solution of keeping frequency steady by using massive spinning flywheels just isn't needed anymore. We use electronic devices for frequency stability, and have for decades. They are more accurate and cheaper.

        It's like saying that you need a pendulum if you want to keep good time. That's a clever mechanical solution, good idea at a time when we didn't have electronics, but we use quartz oscillators now (or atomic clocks, if you really want phase control that won't drift over the course of a thousand years).

    • by serviscope_minor ( 664417 ) on Wednesday November 22, 2023 @04:51AM (#64023559) Journal

      The gas plants were earning a lot of their money doing the first, just keeping their massive turbines spinning but not generating power - but that is a job that batteries can do a lot better. Batteries and their attached inverters can react within half a cycle, 1/100th of a second, gas plants take a few seconds to ramp up.

      It's more complicated than that and you're you are mistaken about this. Over short timescales electromechanical means are much better. They don't store a lot of energy compared to batteries in the rotational inertia, but they have vastly higher instantaneous power output. They can also react in well under half a cycle, in fact half a cycle off is, to put it mildly, dramatic. If you try and connect a synchronous machine to the grid half a cycle out the thing will jump clear out of its housing (interesting if it weighs a hundred tons) as almost all the stored energy is dumped more or less instantly. Synchronous machines will generally nor be leading or lagging by more than fractions of a degree, and the power into or out of them goes up very very fast as that angle increases.

      By themselves electronic inverters cannot stabilize the grid in the very short term, because they lack the power.

      Over longer time scales, like scales of multiple cycles, i.e. a second and up, batteries are very good and respond faster than gas turbines. For the short term stabilization they are and likely will be always insufficient and actually do not remotely have the response time of a traditional thermal plant. Gas turbine gensets (and even better, old fashioned Rankine cycle plants) do an excellent job because they are big and heavy and have a lot of rotational inertia, so if you drop all of those you need to replace them with something.

      The thing in question is a rotary synchronous condenser which is just a big synchronous machine connected to the grid with no prime mover and usually a flywheel, or at least a design which does not minimize rotating mass.

      • by AmiMoJo ( 196126 )

        The original Hornsdale Power Reserve was capable of producing 150MW output, but has been increased to 200MW since its installation in 2017. It was specified to deliver up to 150MW in under 150ms, and is contracted for a minimum of 70MW standby availability.

        Give that's now six year old tech, newer batteries will be even better. With a number of them, any reasonable amount of spinning reserve could be replaced.

        Taking the UK as an example, the largest spikes seen are less than 3GW, and are not all that sharp a

        • You're talking about different orders of magnitude here, and different types of thing.

          150ms is 7.5 whole cycles, I'm taking about degrees, not thousands of degrees.

          And batteries plus semiconductors are good but they are not generally that good at massive instantaneous power spikes as a bunch of spinning mass. in rush currents are the kind of thing here which can be 100x the continuous rated power.

          There's no tech that replaces spinning mass for the instantaneous and very short term stabilisation at which it

          • by AmiMoJo ( 196126 )

            So what sort of loads create these massive spikes?

            • All sorts of things! Big motors, large factories, arc furnaces, transmission line breakers tripping, other faults, random chance from the stochastic process of small loads going at random lining up and so on.

              But it's more than just spikes. The grid itself is just a bunch of wires. It has almost no inertia.

              Imagine trying to control the position of a 1kG mass. But you have several giganewtons pulling it in one direction (loads), with various bits of that force going on and off at random, and this is being bal

      • Do keep in mind that we're talking about two different things here. One is how quickly you can ramp up or down power production to meet changing load, and the other is keeping the frequency and phase of all the distributed power sources in synch to a small fraction of a wave. (You're right that things blow up if you get off by anything approaching a half wave, 8 mS. The controller is supposed to disconnect the errant source off the grid before this happens. You hope.)

        For an inverter (converting DC to AC, fo

    • by gweihir ( 88907 )

      Actually, regulation energy is pretty profitable. It just hat gotten more profitable to do it with batteries now.

    • by Rei ( 128717 ) on Wednesday November 22, 2023 @05:59AM (#64023655) Homepage

      the first is baseload generation when the renewables can't keep up.

      Minor correction: you mean "load following", not baseload :)

      And yeah, what's happening is trends leading to a collapse in the value of grid services, with batteries taking that from NG. But it'll correspond with a rise in the value of plants providing backup for low-wind / low-solar timeperiods.

      To displace that service with renewables and batteries, beyond e.g. long distance (such as HVDC) interconnects and bulk storage (such as hydro), the cheapest way is "overbuild renewables". They're already cheap, and they keep getting cheaper; if what you'd normally build would only provide half your needs during a low-wind or low-sun period, just build twice as much. The side effect is that for most of the year, you have excess power available at a steal, for anyone who is willing to curtail usage during the lean times (energy-intensive industry, water desalination, greenhouse lighting, etc). Each region also has its own ideal mix of wind and solar, as the two work best together, but it depends on the climate. And then the longer the battery storage, the shorter the number of hours per year you need any sort of backup or industry curtailment. Solar benefits a LOT from the first 12-ish hours of storage, but benefits relatively little after that; solar trends are highly seasonal, and you're not going to store power for a season; overbuilding is generally a more economical choice. Wind by contrast, while also commonly seasonal, has a relatively steady - but declining - benefit for any addition of battery storage over multi-day timescales, due to its greater randomness than solar. For Denmark, it looks like this [twimg.com].

      Generally you'll never fully be able to eliminate having some combination of either (A) dispatchable generation, or (B) industry curtailment. And for (A), that means having the plants built and functional, which is a capital cost. But you can bring the mean fuel consumption from such plants down to really low levels (indeed, to the point that "alternative" sources of fuel, such as waste or fuel that was generated with surplus energy, become viable). And normally it's fuel costs that dominate the total amortized cost of such plants in baseload- or load-following roles. Furthermore, if you're designing a plant to be backup, you'll choose a cheaper (albeit less efficient) design.

      (This is an oversimplifcation, of course - for example, if you have a NG plant for backup, you still need to maintain the NG production / storage / transport infrastructure, not just the plant).

    • by rwyoder ( 759998 )

      As I understand it -

      At present Gas plants have two purposes - the first is baseload generation when the renewables can't keep up. That's a lot of work, but it isn't very profitable. The second is maintaining grid stability, keeping the grid frequency at 50 or 60 hertz, second by second.

      There is a third use: "Peaker" plants that come online only at periods of high demand.
      There is one near here: Plains End Power Plant, Arvada, Colorado
      Interesting aspect is that it does not run turbines, but uses reciprocating engines from Wärtsilä.

    • These are peaker plants. https://en.wikipedia.org/wiki/... [wikipedia.org] They are usually a gas powered turbo fan. Their cost per unit of capacity is very low but their generation cost is high (yeah, I know that is confusing). The plants are low efficiency but don't cost that much per unit of power that the plant can generate. They also need to be quick to start. We generally build them close to a natural gas store. They don't run for very long and the main revenues for these are grid stability (keeping the power
  • Batteries have a very long research path, but we are getting there. Obviously they are the best regulation energy you can get tech-wise. Now that cost has caught up...

    • by HiThere ( 15173 )

      In the wider sense, yes. In the finer sense, supercapacitors should be superior, but we can't make them to handle the load. (Supercapacitors *are* batteries, in the wider sense.)

  • Biased data? (Score:5, Interesting)

    by dragisha ( 788 ) <dragishaNO@SPAMm3w.org> on Wednesday November 22, 2023 @07:13AM (#64023729)

    Europe has one reason for the cancellation of such plants I do not find in this article: Russian supplies are cut and the era of cheap gas is gone.

    The economy of gas plants is primarily the price o gas. The article does not even mention it :).

    Also, state regulations are a big factor. If you put regulation burden onto gas and subsidy solar... Wow, look how the economy shifts!

    • by HBI ( 10338492 )

      No one wants to draw attention to the conclusion that maybe starting fights in Ukraine was bad for Europe.

      • Russia started the fight, so why would anyone be shy about drawing attention to that fact? They had already invaded another neighbor on bullshit pretext recently, why does anyone believe anything they say about invading Ukraine — a country that had cities with multi-story buildings while the Russians were still living in huts?

        • Re: (Score:2, Troll)

          by HBI ( 10338492 )

          Sure, the Russians decided to expand NATO in direct contravention of the agreements in the 1990s.

          The Russians sponsored a coup of a lawfully elected government in 2014.

          The Russians decided to not honor the Minsk II agreements, and then bragged about never having intended to fulfill them in the press like Angela Merkel did.

          Just giving you the short preview of how history is going to view this, not well. Seems reminiscent of the Allende or Mossadegh things, in retrospect. Or our intervention in Laos. Even A

      • No one wants to draw attention to the conclusion that maybe starting fights in Ukraine was bad for Europe.

        Oh don't worry. Everybody knows that Russia starting a war in Ukraine was bad for Europe (including Ukraine) and Russia.

        Best thing to do now is pick up the pace of weapon shipments to Ukraine so they can win the damn war and not end up with some BS ceasefire that creates another frozen conflict for 10 years.

    • Re:Biased data? (Score:4, Insightful)

      by swillden ( 191260 ) <shawn-ds@willden.org> on Wednesday November 22, 2023 @11:22AM (#64024349) Journal

      Also, state regulations are a big factor. If you put regulation burden onto gas and subsidy solar... Wow, look how the economy shifts!

      Fossil fuels are inherently massively subsidized as long as you ignore the externality of CO2 emissions. If you internalize that, with a carbon tax or similar, so that gas plants have to either capture and sequester all of their carbon emissions or else pay the cost of mitigating the climate impacts of the emitted carbon, then the economy would absolutely shift and no subsidies on renewables would be required.

  • by sinij ( 911942 ) on Wednesday November 22, 2023 @07:43AM (#64023769)
    Great, but we are not scaling lithium refining and battery production capacity nearly enough to make grid-wide switch to batteries.
    • Great, but we are not scaling lithium refining and battery production capacity nearly enough to make grid-wide switch to batteries.

      It would be foolish to decide that Lithium batteries was the path forward. In a system that does not need the high performance of Lithium based energy storage, there are many other options that don't require that complexity of process.

      I've long agitated for Nickel-Iron batteries. You'd never want to use them in a phone, but they would function well for power storage. Batteries that are tough and can stand a lot of abuse, long lasting and handle lots of recharge cycles. https://en.wikipedia.org/wiki/... [wikipedia.org]

    • by HiThere ( 15173 )

      Don't get hooked on one particular kind of battery. There's no reason that a stationary battery should need to use lithium.

    • Great, but we are not scaling lithium refining and battery production capacity nearly enough to make grid-wide switch to batteries.

      A few years ago I read an article, which I sadly can no longer find online, written by a physicist who was a student in the 60s, just when color television was becoming available. As a young man, he had come to a startling realization: The particular red phosphor used in color TV cathode ray tubes was an extremely limited resource. In fact, the world's total supplies of the phosphor were enough to manufacture only a few hundred thousand TV sets. He predicted at the time that color TV would be available only

C'est magnifique, mais ce n'est pas l'Informatique. -- Bosquet [on seeing the IBM 4341]

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