Friday, March 18, 2005

Arizona may mandate investments in renewable energy

Solar, wind energy may get push from state
By 2025 renewable energy could be powering a million Arizona homes. State regulators are considering a plan to make utilities boost the amount of power they generate from solar, wind, biomass and other renewable sources to 15 percent of their total supply by 2025. Such a mandate would be a boon for the renewable-energy industry in Arizona, providing capital to develop wind farms and solar power plants.
It goes on to discuss efforts in a number of states. However, look at the costs.
The chief argument against solar has been that it is expensive. Indeed, early solar plants produced electricity for about 35 cents per kilowatt-hour. But Tom Hansen, head of the TEP renewable energy program, estimates with subsidies the plant can generate electricity for 10 cents a kilowatt over the long term. "That's getting competitive with conventional electricity," he said. Natural-gas-fired power plants now produce electricity for 5 to 7 cents a kilowatt-hour.

That’s not very competitive, and that’s with the subsidy paid to the producer!

Some additional data. These are historical costs for various kinds of electrical power generation. It’s actually limited to investor owned utilities.

Hydro is far and away the cheapest at .75 cents. (Yes that’s three fourths of a penny.)

Nuclear and Fossil (coal primarily) are close at 1.8 cents and 2.2 cents per kwhr.

The newer natural gas plants are the most expensive at 4.9 cents – primarily due to the run up in natural gas prices.

For electricity generation, not capacity, coal provides 50%, nuclear provides 20% and Natural Gas provides 16%.

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