The reality is much more complex than "batteries replace gas" -<p>> Developers can no longer use financial modelling that assumes gas power plants are used constantly throughout their 20-year-plus lifetime, analysts said.<p>> 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.<p>> "It does become more complex," Nigel Scott, head of structured trade and commodity finance at Sumitomo Mitsui Banking Corporation, said.<p>> Investors are putting increased scrutiny on the modelling, he added.<p>- so basically, maintaining a large-scale grid is an optimization problem. And batteries merely shift the answer to "how much of which each type of equipment should we have?" around some. Kinda like someone architecting a DC-scale system has to understand trade-offs between L1 cache / L2 cache / L3 cache / local-to-core RAM / more-distant RAM / SSD / HD / Tape - vs. what equipment is actually available - at what prices, lead times, configuration limitations, ...
This is a great example of economics at work. Large-scale electricity storage solutions reduce the need for generating capacity from peak load to average load - reducing the demand by the crest factor of the grid. The majority of this extra generation capacity is currently filled by gas (that is incredibly easy to spool up and down in a matter of seconds). Reducing the demand for natural gas will also increase the cost of other fossil fuels (which are mined in the same place), and it's a virtuous loop...
> "Without providing price detail, which companies say is commercially sensitive, Clarke said Carlton had struggled to finance the planned gas plant in part because of uncertainty over the revenues it would generate and the number of hours it would run."<p>This is the crucial point. Political uncertainty about the future energy system is jacking up the rate of return investors are demanding of gas plant projects without contracted revenues. This is the main reason why gas projects are falling through. At the same time, there is currently no scalable storage system for time-shifting surplus renewable generation over weeks-to-months, so that it can offset renewable troughs. This means surplus renewable generation is simply being wasted, and for that reason, is so low cost that even hours-to-days battery storage - which <i>is</i> a mature storage system - is economical. It's far less clear this is a long-term proposition for at-scale storage, as the longer you can store energy for the higher the efficiency of matching surplus to deficit. Hydrogen and pumped hydro can store energy for far longer.
It would be neat to see an alternate universe where there was zero corporate welfare for petroleum and for solar/wind/tidal/hydro. I imagine that in such a world, renewables would have become the default sometime in the 70s and millions of lives would have been saved due to fewer oil wars and cleaner air.
A few years ago I scraped some publicly-accessible data from <a href="https://www.iso-ne.com/" rel="nofollow noreferrer">https://www.iso-ne.com/</a> regarding the spot cost of electricity.<p>Then I fed it into a battery simulator that I wrote.<p>Based on my estimated cost of a grid-scale battery, I estimated a payoff in ~2 years; and then a lot of profit.<p>The biggest challenge is the politics and red tape of connecting something to the grid. The grid operators are used to power plants being multi-year projects.
We should take a moment to acknowledge the Power MOSFet in this story.
For a guy who paid money for his first germanium transistor generating grid scale power with transistors is TOTALLY amazing.
Tomorrow's fuel should be the battery.<p>A battery can only solve a local issue: a system for locally produced and consumed electricity, If the sourcing solar or wind is transformed to fuel, you also have storage, probably a gas or liquid. And you catch two birds with one stone: storage and distribution. That could be shipping, pipelines but also gas stations. Infrastructure we already have.
Germany paid 4 billion for energy dispatch in 2023.<p>That would be enough to buy 80000 cars with 100kWh and provide 8gWh and would be 8x more than Germans biggest water energy storage.<p>Did I miss something?<p>Sounds absolutely doable in a few years to have massive more energy storage available.<p>Combined with a lot more and cheaper renewable energy
For the price of a gas power plant you can buy some *serious amount* of LiFePo4 batteries, and Sodium Ion batteries are now also slowly hitting the market.<p>[0] <a href="https://news.ycombinator.com/item?id=38361094">https://news.ycombinator.com/item?id=38361094</a><p>At some point we may still need small gas power plants to charge the batteries but how many days a year would we have to do that?<p>It may be a touchy subject, but to me Nuclear power is absolutely not the future because for the money you can deploy so much renewables, including batteries, it just doesn't make sense. And they are never on time and on budget.
This is actually great because it reduces the vastly outsized impact of gas prices on short-term electricity prices through peaker plants via the merit order system.
The Lazard LCOE cost of unsubsidized solar/wind + storage has recently achieved parity with gas turbine combined cycle.<p>So the writing is on the wall for fossil fuels.<p>What's also important is that gas combined cycle kind of represented the end state of maximum power for minimum cost from fossil fuels. Wind and especially solar (perovskites, etc) and storage (sodium chemistries, etc) have lots of runway for further cost drops. So you might squeeze a couple percent out of gas combined cycle for LCOE in the next decade, but solar/wind may still drop by 50%.<p>So if you have a ten year view (which is what you have fore investment in power projects) fossil fuel projects (and alas nuclear, which is 6x more expensive than wind/solar) simply don't balance the sheet.<p>Lots of hope. Lots of work to do.<p>EDIT: response to "why do you think solar/wind have bigger runway to drop in price:" (I hit my post limit)<p>Wind can simply scale up more, and there are other designs coming online. Wind I don't have the holy-crap-this-is-still-coming thing.<p>Solar however has made its gains with silicon, but perovskites are simply dirt cheap to manufacture, IF they can eliminate lead and get them to last long enough. I'm spitballing, but perovskites will probably drop the cost by 50% long term in solar.<p>Solar also really hasn't developed large scale multijunction, and perovskites + silicon may enable that. Multijunction is how you get the higher efficiencies by capturing more wavelengths and the like.<p>As for gas turbine, they already are exceeding the carnot efficiencies by capturing downstream heat cycles and other tricks. And I think the other thing as an energy financeer I'd worry about is that any fossil fuel power generation has to be worried about an eventual carbon tax imposed.<p>As the political power of oil companies wanes as their economic strength withers away as EVs and alternative energy undermine their economic value proposition, their ability to keep the environmental lobby from imposing a proper externality tax on carbon emissions with falter.<p>So any gas generation power plant could overnight have their costs increased by 10-50% or maybe worse. Best case: you have to pay for bullshit offsets, which will probably increase costs 10-20%. Medium case: they have to explicitly pay for the carbon scrubbing/removal, probably 50% increase or more to the generation cost. Worst case: we realize that fossil fuels carbon taxes should include a cost to remove PREVIOUSLY UNTAXED carbon that is sitting in the atmosphere. So then the cost could be exhorbitantly increased.<p>Likely SOMETHING is coming that will increase the cost of fossil fuel power and fuels due to carbon removal. It will start small and increase as the political strength of oil / gas wanes.
It seems the core issue is that electricity pricing isn't taking into account that some power sources could just go offline for days/weeks. Perhaps they need to find a politically correct way to apply a tariff against unreliable sources and just pay for standby capacity.<p>This will cause renewable energy to become somewhat less attractive financially, but the alternative is a grid that becomes unreliable over time as gas power plants are decommissioned and don't get replaced.