[downandout]

Wind and solar are still not competitive. The report says that coal costs $75 per megawatt hour, while land-based wind costs $83 and solar comes in at a whopping $122. That's far from "almost competitive". Also note that these are not costs of production, these are what people wind up paying for it. That means that the coal numbers include extensive taxes, while the solar and wind numbers include extensive tax discounts and incentives. This makes the real difference in production costs even bigger than what this report implies.

If we as a society decide we want clean energy, that's fine, but it is important that people make these decisions based upon actual facts. Clean energy in 2015 is still significantly more expensive than energy produced using fossil fuels (and of course this report leaves nuclear out entirely, which is far cheaper than coal).

[rayiner]

> Also note that these are not costs of production, these are what people wind up paying for it

Cost of production and what people pay are two different things. A true accounting would include cost of production and externalized costs. Doing that doubles the price of coal: http://green.blogs.nytimes.com/2011/02/17/tallying-coals-hid...

> Even the study’s most conservative estimate of the uncounted cost of coal — $175 billion a year — would more than double the average cost of coal-fired electricity, the authors found.

And most of that is from well-understood and well-measured health impacts of coal pollution:

> At this lower range, roughly 80 percent of the costs were from well-documented public health impacts like lung and heart disease

So you pay $75 per megawatt hour for coal. And then the poor sap who lives downwind of the coal plant pays another $75 per megawatt hour for your electricity use in the form of dying early from lung cancer.

[crdoconnor]

>The report says that coal costs $75 per megawatt hour, while land-based wind costs $83 and solar comes in at a whopping $122. That's far from "almost competitive".

$83 is close enough to $75 that tweaks to tax policy can now be used to make renewable energy investment over fossil fuel virtually a no brainer decision without adversely affecting overall energy production that much.

Indeed, that's pretty much what Germany has done.

>Also note that these are not costs of production, these are what people wind up paying for it. That means that the coal numbers include extensive taxes, while the solar and wind numbers include extensive tax discounts and incentives.

I won't speculate as to why you didn't note that fossil fuel subsidies are also included.

[downandout]

>$83 is close enough to $75 that tweaks to tax policy can now be used to make renewable energy investment over fossil fuel virtually a no brainer decision

The tweaks to tax policy you're referring to have already happened, and they still haven't made wind and solar competitive. Taxes and incentives being included are the only reason that the numbers quoted in this extremely misleading report are even remotely close to each other (although an 11% difference in a multi-trillion dollar industry is hardly insignificant).

[crdoconnor]

>The tweaks to tax policy you're referring to have already happened, and they still haven't made wind and solar competitive

They already did in the UK and Germany as the article points out.

The political weight of utilities and the oil/natgas industry is significantly higher in the US which is probably why the US hasn't followed in Germany/UK's footsteps. Too many Senate re-election campaign funds being paid for by Kochs, etc.

[forgetsusername]

>"too many Senate re-election campaign funds being paid for by Kochs, etc."

Or maybe, just maybe, decision makers realize that this stuff doesn't have to be, nor should be, implemented overnight?

Renewable energy innovation is occurring at an incredibly fast rate. The economy is a complex thing. Adoption will happen without distorting markets with overwrought subsisidies and burning money trying to accelerate it further.

[crdoconnor]

> Adoption will happen without distorting markets with overwrought subsisidies and burning money trying to accelerate it further.

So you think that instead of introducing counter distortions to protect the environment we should just keep the distortions that are damaging it that we already have?

[Shivetya]

We need to carefully balance tax breaks for renewable energy solutions so that they do not stifle innovation. The key is to make buying renewable energy enough to entice consumers; both families and business; while at the same time not slowing the progress of innovation because the handouts are too profitable to give up.

[brrt]

I admire your optimism :-) but I'm not 100% sure that is true. If there wasn't a political drive behind this, wouldn't it have been easier to burn coal for the next 100 years?

[talmand]

There are lots of examples of innovations changing entire industries without a political drive being behind it. The day someone discovers a clean energy method that is easily cheaper than fossil fuels will be able to cash in because the market will switch to it quite handily, regardless of politics. The only political drive I really worry over with things like this is cronyism that prevents innovations in an effort to maintain status quo.

[Xixi]

Germany main source of energy is still, by far, coal (lignite to be precise), and it's not going down yet. The expansion of renewable energy, which is very real, is being done at the expense of nuclear energy.

I wish they would be doing it the other way around: closing coal power plants before the nuclear ones. But Germany has lignite, and doesn't have much of a nuclear industry, so economically it makes much more sense that way...

EDIT: typo

[crdoconnor]

AFAIK since 2013 they've almost totally stopped building new coal plants. They've removed subsidies on mining, too which has led to pit closures.

If it's not going down already, I imagine it will be going down within the next couple of years.

[Xixi]

Sure, it will eventually decline. But when you see the sharp decline in electricity produced from nuclear power plants, it feels like a missed opportunity to lower CO2 emissions faster.

I'm only looking at this from a greenhouse gases point of view. Maybe German nuclear power plants are particularly unsafe and it's better to wind them down quickly? I doubt it, which is why I lean towards an economical (more so than financial) decision.

[the_why_of_y]

Nuclear energy generally depends on the political will for the state to (in effect) take on the cost of insurance for the most serious accidents, since it is impossible for the energy producing companies to buy such insurance. It looks like in Germany that political will is no longer there.

[7952]

This kind of thing does leave renewables open to attack based on the "subsidy bad" line of thinking. The whole point of the incentives is to pay a fair price for a superior product that does not cause pollution and health damage. It is unreasonable to require a superior source of energy to actually be cheaper. In that sense nuclear/solar/wind are worth purseing even if they cost more than coal. The fact that renewables are so competitive is more a testament to how inefficient large fossil fuel power stations are.

[JoeAltmaier]

Lost you. Large fossil fuel power stations are undeniably more efficient (cheaper) than the alternatives. Renewables are not competitive at all, yet.

[lkbm]

Pretty much everyone DOES deny this, once you factor in all costs. Pollution costs everyone. The undeniably better prices don't count that cost.

[JoeAltmaier]

Agreed; pollution is the real cost. But that wasn't said; not even implied. At least how I read it. That last sentence seemed a non-sequitur.

[ZeroGravitas]

It was said:

"The whole point of the incentives is to pay a fair price for a superior product that does not cause pollution and health damage."

[7952]

Well the entire raison d'être of a fossil fuel station is that it exploits the high energy density of its fuel. Despite the incredible property of coal and gas it is hardly "cheap" exactly. In a lot of economies energy bills would still be expensive for most people even if we only had coal and gas stations. It is perfectly possible that local solar will be cheaper than fossil fuel in the long run, especially when you take transmission losses into account

[tallanvor]

Taxes are part of the cost of electricity, and it's perfectly reasonable to include them in the cost of production. Wind power being down to within 10% of the cost of coal, that's absolutely competitive territory.

Additionally, the article notes that in some countries the costs are even higher for coal and natural gas, and in those countries, solar is certainly within competitive costs.

You might not like that governments are taxing some forms of electricity more heavily, but it's a valid way of encouraging the industry to migrate to cleaner options.

[vog]

> You might not like that governments are taxing some forms of electricity more heavily, but it's a valid way of encouraging the industry to migrate to cleaner options.

It's not just a "valid way". This is the way taxes are intended to work! Taxes are not just a way for the state to collect money (maybe in the past centuries). They are also the main way to frame the economy.

Here in Germany, the term for "tax" is "Steuern" which means something like "controlling/steering/directing/governing". This is exactly the official purpose of taxes, and includes collecting as well as spending taxes.

[talmand]

It's interesting how many times I see people not understanding the effects of taxes. Like the short-minded people that think they'll reap huge benefits from taxing cigarettes and base their budgets around it. But then people stop smoking or find alternative sources for cigarettes so that the huge windfall of tax income never happens. Now they are left with a huge hole in their budget.

[the_why_of_y]

Did you consider the possibility that taxes on cigarettes are intended as an incentive to stop smoking and thereby lower the health care costs of treating long term smokers' various ailments?

[talmand]

Yes, but are you assuming that all tax districts had the same thinking? The situation I'm referring to up in the Northwest US, as I recall, was not considering that. Plus I'm sure there are other examples of budgets being based on taxes that didn't pan out, leaving a deficit in the budget.

[downandout]

I simply pointed out that by using prices that include taxes and incentives, this report artificially exaggerated the costs of coal and understated the true costs of solar/wind. They aren't really even close to being competitive in real terms, but this report falsely implies that they are.

Bloomberg LLP, the company behind this report, is run by Michael Bloomberg, a billionaire radical environmentalist. Therefore it isn't necessarily surprising to see such misleading tactics used in a report produced by them, but it is disappointing because Bloomberg masquerades as a news organization.

[icebraining]

I simply pointed out that by using prices that include taxes and incentives, this report artificially exaggerated the costs of coal and understated the true costs of solar/wind. They aren't really even close to being competitive in real terms, but this report falsely implies that they are.

How do you define "real" terms? Sure it's not the price that would emerge if those taxes/incentives didn't exist, but market prices are always adjusted to the current particularities, it's never an absolute value. For example, if it was technically and legally possible to identify all the health and property damages caused by coal pollution and force the coal producers to compensate affected people, the market price of coal would have to be higher than what you call "real" cost, but would that be any less real?

[downandout]

>How do you define "real" terms?

The actual cost of production without artificial factors like taxes and incentives being included.

[fauigerzigerk]

Regulating or taxing emissions is simply a form of collective demand for clean air, a scarce resource. I don't see how it is any more artificial than demand for land that drives up the prices for coal mines or the demand for labor that determines salaries of coal miners.

In other words, producing energy by burning coal consumes clean air. Clean air is owned by the public and the public is charging for its use.

[m_eiman]

You should also include external costs to your cost of producing coal power; then is what the CO2 taxes are an attempt to do.

That someone else is forced to pay to handle the effects of your pollution doesn't mean that this cost shouldn't be considered part of the cost of coal generated electricity.

[forgetsusername]

I don't think downandout is confused with the purpose of taxes, nor do I see it disagreeing with them.

The point I think (and to which I agree) is that real costs matter because anything can be "competitive" with enough subsidization. And subsidization doesn't make things cheaper in the real sense, it simply realigns incentives.

As is, renewables are heavily subsidized, fossil fuels are taxed heavily, and there's still a gap. It's trivial to close that gap through tax policy. So then the question becomes, what is the correct level of subsidization? I'm not sure, but I don't think the answer is "more, more, more". Because eventually you will eliminate the industry that is paying the taxes to offset the subsidized one. When it's no longer economically feasible to pay those heavy subsidies, that's when you'll see why the real cost of production matters.

[joosters]

But excluding factors like the health/pollution costs? So, not a fair comparison with things like wind/solar then.

[ZeroGravitas]

Those are global averages. Some countries have lots of sun and little coal, and vice versa.

Islands that have to import oil to burn are ideal early markets for example.

And every solar panel or wind turbine reduces the price of the next, a positive feedback loop.

Every bit of coal or gas burned puts more CO2 in the atmosphere and increases the costs that governments will impose on production, a negative feedback loop.

[puranjay]

This reminds me of that comment attributed to Bill Gates: "64k memory ought to be enough for everybody"

The trend is very clear: solar and wind are dropping in prices. It's now only a matter of when, not if.

[CyberDildonics]

Except that he didn't say that at all and has given extremely detailed accounts of the current thinking at the time in history (they were already looking towards the upcoming limitations and bottlenecks they would face in expanding RAM sizes).

Although it is true that solar and wind are dropping in prices recently I don't think an urban legend misquote has any relevance.

[puranjay]

Which is why I said that it is "attributed" to Bill Gates. I know he didn't say it

[dalke]

In the future you might want say 'misattributed' or 'wrongly attributed' for this case.

The term 'attributed to X' can mean "is widely but wrongly attributed to X", but can also mean "I heard it somewhere and it sounds true so I'll go with my gut feeling instead of verifying it" or "I hear there are doubts, so while I have no opinion, I'll keep my bases covered."

Personally, rather than be stuck in that mire, I would suggest quoting Prof. Frink from Simpsons:

> 'I predict that within 100 years, computers will be twice as powerful, 10000 times larger, and so expensive that only the five richest kings of Europe will own them.'

This in turn came from the quote widely but wrongly attributed to Thomas J. Watson of IBM:

> 'I think there is a world market for maybe five computers'

Quoting from https://en.wikiquote.org/wiki/Thomas_J._Watson :

> Often dated to 1943. Thorough research of Watson's writings and statements have produced no example of him saying this. It appears to be a corruption of a remark by Howard Aiken that four or five computers could meet all of the United Kingdom's computing needs. See Ralph Keyes (2006), The Quote Verifier.

Of these, only the Frink version has an accurate attribution. I think the other two come with some malice. By repeating the urban legend as if it's relevant, I think you are forwarding that malice, even if unintentionally.

[gambiting]

They can drop to zero, they are still not going to replace regular power plants because you can't guarantee baseline power with them. You could drop all power generated with them into pumping water to huge reservoirs, so they can generate baseline power around the clock, but it's not feasible in a lot of places, and you are losing a lot of energy just to move the water up and down.

[olau]

Not sure whether you're just using the term incorrectly, but I see this claim repeated a lot so forgive me for explaining: you do not need baseline power.

Baseline power is the observation that if we have less than ideal power plants that need to run 24/7 to be economical (usually because of high capital costs, e.g. nuclear plants), we can still deploy them if we then also invest in other plants for filling in the peaks.

See, the important part here is that you always need to meet demand (maybe you can shift demand around a bit, but after shifting it the observation still holds).

If you have baseline plants, your supply curve is a flat line so the peaks in the demand are the holes you need to fill in somehow.

With a renewable source like wind or solar, you may actually be able to meet the peak demand, but then have a hole in the supply at some other point (say at night, or when there's no wind). So you need to fill in these somehow (as you say).

[JupiterMoon]

What about the cost of cleaning up the emissions from the coal? Who pays for this?

[peteretep]

That's what the article refers to as tax on emissions.

[mtgx]

Coal is heavily subsidized in many countries, even up to 50% in some.

[cma]

You aren't including the subsidies oil gets via tax payments to fund our wars in oil-producing nations.

[mavhc]

"Fossil fuel subsidies reached $90 billion in the OECD and over $500 billion globally in 2011. Renewable energy subsidies reached $88 billion in 2011"

[theklub]

What about cost to the environment?