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79 comments on Wind power set to decline under Obama?
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79 comments on Wind power set to decline under Obama?
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The cost per MW of wind is higher than the cost of MW of gas-fired electricity. That makes capacity more expensive, NOT electricity (cost per MWh).
And it is also a fact that you require more jobs per MWh of wind power - you need more labor and less fossil fuel to produce the electricity, which can probably be seen as a good thing today.
Such a calculation is incomplete. It assumes infrastructure at no cost.
For ex. the north stream gas pipeline roughly estimated cost is Euro 5 bn.
Of course this is to be paid by EU taxpayers.
All cost comparisons published by utilities is always exclusive infrastructure cost.
Not so with wind power. That is the reason
why power companies claim wind energy is expensive. Yes it is but not for the tax payer.
If electrical energy generated by nuclear fission had not been so heavily subsidized
in EU it were, by simple arithmetic, not competitive.
Given that the largest part of the cost of natural gas is infrastructure, it certainly IS included in the price of gas. Nordstream will not be paid by taxpayers, it will be paid by Gazprom (and, in practice, deducted directly from the payments for bas by Ruhrgas & al) via an agreed tariff per volume transports and/or a capacity charge.
I don't know why we are having this argument: I certianly agree that wind is cheaper than gas for power generation, without subsidies, but that does not mean that the calculations should be done wrong, and the fact remains that a MW of gas-fired power plant (which does not include the cost of gas, and thus does not include the cost of the gas infrastructure) is cheaper to build than a MW of wind - it will simply be a lot more expensive to use.
No argument. I just want to put the actual variables and constants in place.
The EU is supposed to subsidize north stream with Euro 5 bn in addition to investment by Gazprom and E.On.
German chancellor has just today called EU to support this subsidy ( I hope it will be rejected)
If you were to built a shopping mall you have to provide infrastructure including
new roads parking lots etc.
Of course this cost is part of building cost not of operating cost. The cost of maintenance is operating cost.
The same applies for a gas fired power plant.
Don't get me wrong I do not argue against gas fired in fact modern facilities have an overall efficiency of 60% but I argue against the propaganda and lobby work of
the all too mighty power companies.
For ex. Gazprom is about to built a 400 MW gas fired power plant somewhere in east germany. That means, the utilities
make still upside profit with already extremely expensive Gazprom gas - more than 2 times the price of Henry hub spot.
The utilities use the pretext of extremely expensive renewables to ever increase energy prices.
The more jobs is better argument is popular with politicians, but is a sign of economic inefficiency.
More jobs simply reflects the fact that you are not relying as much on the input of (non renewable) fossil fuels...
It would be interesting to compare the jobs required to build and operate 100 MW of wind vs. the jobs required to get the gas and build and operate the pipelines for 100 MW of gas-fired.
Indeed. My point is simply that job creation is not a virtue in itself.
It is a virtue - the cost to society of unemployment is quite high (certainly, you're not going to argue that higher unemployment is more economically efficient?). If fossil fuels are replaced by labor, then we have a double-edged sword.
All things being equal, lower jobs/MW will get cheaper power. But that's the problem, all things are not equal. The cost/kWh is important, and is also shaped by capital and fuel expenses. Properly sited wind is affordable so if it has relatively high jobs creation, all the better. Nice gravy when we realize it's the cost of the fuel where the reduction is. Less imports, less externalities.
By contrast, if a technology produces power very expensively, having few jobs/MW, or many jobs/MW, will not matter much.
My point is that there are other important factors to take into account when it comes to economic efficiency.
But maybe that's what you were trying to say as well?
Lets not construct strawmen. Technology that destroys jobs is economically more efficient. Its a simple advance in productivity.
If the jobs displaced aren't created in other industries, thats a systemic problem of the whole economy. Its bad. But a technology that requires more labor isn't good because it creates jobs.
Let's not construct strawmen indeed! What you are saying here is very contradictory. If a technology destroys jobs and doesn't replace as much jobs in other/new sectors, then the economic efficiency gain might well be negated. As I mentioned above, other factors that contribute to the cost of a technology must be taken into account. If these other factors are high then the total cost will be high and even though it may have less jobs it will not be economically efficient. It'd be interesting to see a detailed study that takes various macro economic effects into account for different sources of generation.
So cost/kWh might be considered the single most important measure for economic efficiency, and for wind in a good location it's low. So then the labor intensive nature is a positive. Saying a technology isn't good because it creates jobs is a strawman in itself. A technology isn't good because it creates jobs, but it is better to be jobs intensive than fossil fuel intensive, as long as the levelised cost is reasonable. So for wind it is a positive.
This statement makes me wonder if you realize what a straw man is.
A technology that destroys jobs doesn't create new jobs. Thats up to the rest of the economic environment. In a good market, wealth created by increased productivity opens up more opportunity for capital to hire labor in growing industries. In a bad market, jobs are just destroyed. Insert your favorite economic ideology on what environments create good or bad markets.
I'm entirely agnostic on other arguments. My only position is that as a whole is that labor cost is a liability rather than an asset.
Nope, you were presenting a straw man yourself. Misrepresenting my position - indeed, I tried to make clear that there are other factors involved as represented by eg levelised cost. Maybe you were trying to say this as well but you weren't explicit enough about it.
But your statement also happened to be internally contradictory, since if the societal benefit of economic efficiency is lost in the societal disadvantage of fewer jobs (more unemployment) then the economical efficiency argument is no positive argument at all, since society may be no better off (or even worse off).
It does create jobs related to the new 'destroying' technology; technology without jobs is impossible by definition. This could be a large number of new jobs or a small number but it will always be nonzero. The rest of the economic environment has to be considered as well of course, that's a good point.
Labor cost is part of the levelised cost of energy. If labor costs are high but fuel and capital low (rare) the technology could still be the most competitive with other more fuel and/or capital intensive technologies. If the total of capital and fuel costs are already on the high side, having a relatively high labor cost on top of that could be a liability. Still, jobs are a macro-economical asset even though the cost of this labor is a liability. These have to be quantified and compared with each other.
It's rather an academic argument, since in the case of wind fuel is replaced by labor, and even if the cost is similar the societal advantage will be large (less money flowing out of the national economy, less GhG and air pollutants etc).
Oh dear, apparently we can't communicate at all. I wasn't misrepresenting your position because I didn't reference your position whatsoever. I don't care about your position at all on energy cost or fossil fuel inputs or any other specific instances of a specific case, as I don't have a position on them or their cost relative to the cost of labor at all. The only point I made is that labor cost is a liability and presenting it as an asset isn't correct.
Yeah, we're not really having a genuine discussion are we? If you don't present a position, you're asking for strawmen.
Yes, and as I've argued, a moot point. Labor cost is a liability if you want to call it that. I call it part of the levelised cost of energy. Higher cost is less competitive, so in this way it might be considered a liability. But it's rather a big loaded word, and you have to consider the context: what are the other costs, what is labor replacing? If labor replaces imported fuel then benefits abound.
If labor cost is a liability then jobs are an asset, so it's both, and they have to be quantified and compared with each other. It's important to internalise externalities when societal advantages/disadvantages must be considered.
Economic efficiency is about inputs and outputs, and any assertions about one side of the equasion cannot be comprehensive. Inputs and outputs have to be compared. This has little to do with ideology, just economics 101.
What costs are you talking about? If people who are unemployed become alcoholics and require medical treatment then that treament is a cost. If unemployed people become mentally depressed and require psychiatric treatment, then that treatment is a cost. However, unemployment payments are not a cost to society. It may appear that they are, but this is really not the case. Two kinds of events can result in a cost to society. One is an event which decreases our net productivity. The second is some kind of economic 'bad' (as opposed to economic 'goods') which we have to spend resources on to heal (e.g. alcoholism or mental illness). If people become unemployed because of efficiency improvements in their industry then our net productivity has not declined, so that no one has to become poorer in order to provide the unemployed people the wherewithal to continue purchasing the necessities of life.
In a resource limited world we should be focusing on the creation and maintenance of sustainable wealth, not on job creation per se. It is easy to imagine society benefiting from less production rather than more production. For example if we manufactured a much smaller variety of consumer electronics and designed those fewer products to last for decades, this change would be a benefit to society in a resource constrained world, even though it would mean fewer jobs in the electronics industry.
People who work themselves out of a job for the benefit of the community should not be deprived of the right to consume economic output. Of course we do not want people to remain unemployed for the long term. We need to share the necessary work. We need to create an environment in which people who do the right thing from the perspective of long term resource consumption are confident that the community they are helping will in turn help them. We need to end the "atomized, every nuclear family for itself, I want to preserve my own job no matter how stupid, wasteful, and destructive it may be" point of view which prevails in our current economic system.
Direct costs are social payments of unemployment benefits, which depend on the country. And of course what you mention, healthcare treatments etc.
However, there is also the oppertunity cost of someone who could be working in stead of being unemployed. This is how cost benefit analysis is being done - also for example, when a coal plant emits nasties that makes people sick x days more per year, that loses x amount of productivity through lost work hours.
A similar CBA could be done for the employment benefits and costs of a specific technology (in this case, wind turbines).
I think we should be focusing strongly on measurable wealth, so that we can do cost benefit analysis. Having good mobility can give measurable wealth, but the added measurable wealth of driving a 10 MPG car compared to driving a 50 MPG car is marginal at best, while the extra resource use is large. External effects need to be taken into account as best as possible.