[victoro]

we are intently focused on what we anticipate will be the two biggest drivers of the next decade:

The first is the marginal cost of energy going to zero.

I anticipate that this is the dumbest thing I will read from a supposedly serious person in the next decade.

Predicting a 0 marginal cost of energy is basically predicting a post-scarcity society... in the next decade... thanks to solar and wind. Oh and a wee-bit of natural gas thats somehow going to be magically piped out of the ground and transported to power plants free of charge... I guess by the same good folks who will be manufacturing and maintaining all of the solar panels and wind turbines free of charge...

How is one even supposed to seriously discuss or critically examine an article when its conclusion is that we'll build a perpetual motion machine in the next 10 years?

[goodcanadian]

Perhaps, you have misunderstood the meaning of "marginal cost." It does not mean that there is zero total cost. Marginal cost is the cost of producing the next kWh. Once my solar panels are installed (not necessarily cheap at all), the marginal cost of producing power is essentially 0.

[neximo64]

You’ve basically mentioned it’s not zero since the cost of the spend on the solar panels would have a next best alternative and a hurdle rate. So each marginal kWh does have a cost, not to mention the depreciative factor.

[typon]

Maintenance of the power inverter, batteries, wiring, and the panels themselves means that marginal cost is not zero, and as long as we don't know the solution to entropy, will never be "essentially" zero.

[tuatoru]

All of those things happen the same, and cost the same amount, whether 10 kWh are produced or 11 kWh. The marginal cost of the last kWh is zero for these items.

There is thermal wear on the power management and voltage step-up electronics, but it is small unless design parameters are exceeded in going to 11. So maybe those components would have to be replaced ten milliseconds earlier than otherwise.

[cinntaile]

Those things need to be maintained so seldom that they won't be far from 0 though. Systems without moving parts are nice like that.

[victoro]

Setting aside the article's mention of moderately intensive solutions like natural gas which has a very real and obvious cost per KWH, your panels will still need maintenance and eventual replacement (the current industry standard lifetime for a panel is 25-30 years), as will any peripheral systems required for the panels to work (batteries etc) and even the space they take up has an associated opportunity cost.

[primax]

Again, no one is saying that isn’t true. He’s saying that the marginal cost, the main inhibitor to rapid scaling, is likely to approach zero.

[victoro]

Why is the marginal cost of a KWH the main inhibitor to rapid scaling? Wouldn't the main inhibitor be the marginal cost of additional capacity?

To put it another way, if my solar panel can currently support 10 GPUs running all day but I need to run 11, don't I need to add another solar panel?

[ianai]

Marginal cost is the derivative of the cost function. Fixed costs drop out of the derivative. You’re confusing amortizing a fixed cost with marginal cost.

[spaceman_2020]

* provided you’re located in a region that has ample solar power.

Turns out, a lot of the world doesn’t really live in perpetually sunny or windy places.

The solar-wind cult would be hilarious if it wasn’t so tragic. Entire economies have suffered because they marched headfirst into solar and wind without understanding their own geographical limitations (prime example: Germany).

[namdnay]

Germany suffers because they decided to abandon Nuclear, not invest in wind/solar. It’s possible to do both

[cinntaile]

They understand their geographical limitations just fine, Germany's plan was wind, solar and gas. Not just wind and solar as you claim.

[lpapez]

Agreed, I saw those two predictions and closed the tab immediately. Was a interesting article up to that point but it's evidently bonkers and/or naive.

[pkkm]

>from a supposedly serious person

The article is by Chamath Palihapitiya, a guy who shamelessly attaches himself to whatever is currently popular. When he's arguing in favor of an idea or movement, that tells you nothing except that it's trendy and can be used for self-promotion.

[victoro]

Haha well I'm in full agreement with you (and u/shapefrog below) on your Chamath evaluation, but the sad reality is that his influence, by virtue of both the money and attention he can direct towards projects he deems worthy, is real and serious. Though hopefully statements like "the marginal cost of energy will approach 0 in the next decade" will help erode some of that influence...

[shapefrog]

> a supposedly serious person

Its Chamath Palihapitiya. The word "supposedly" is doing a lot of work in that description.

[taneq]

This is what gets me about fusion power being touted as “unlimited free energy.” The cost of the coal going in to a coal fired power plant is a tiny fraction of the final retail cost of electricity. If coal were free, retail power cost wouldn’t go down appreciably. So replacing the coal burner with fusion isn’t going to make it suddenly free from the wall socket.

[tuatoru]

Let's see. There's generation, transmission, distribution and final use.

The most costly part is probably distribution, taking electricity from the 11 kilovolts of transmission grid endpoints to street-level voltage and connecting up each house/factory. That's a lot of wire and a lot of maintenance.

If you can generate electricity and use it at the same place, you avoid transmission and distribution costs. If the cost of an extra kilowatt-hour is zero, as with PV once the systems are built, then the marginal cost for that use is zero.[1]

This implies we'll see large electricity users set up shop right next to, or in, PV farms.

1. It won't be zero zero, of course. Using the PV system's power control circuits (and possibly internal voltage step-up or step-down circuits) will affect their life. But those costs are pretty small in the scheme of things. Infinitesimal cost rather than zero, perhaps.

[Ekaros]

It really depends is the real answer.

Let's take a pretty low price of 50 per tonne from 2018. Tonne produces 2 460 kWh. Thus 2 cents per kWh.

But last year prices were at 400+ level and currently 170 I think. So about 6 cents per kWh. Not actually not that tiny fraction.

Ofc, this ignores fixed costs, and carbon credits that are huge price add.

[fragmede]

The thing is, we are post scarcity for certain goods. If we ignore copyright issues, it costs a few thousand dollars (via Cloudflare R2 and BitTorrent) to distribute a copy of a book to anyone with a smartphone and an Internet connection. If we want to move to a utopian post-scarcity society, we should start good that can be duplicated, basically infinitely, and iterate from there. we'd need to make sure creation of digital goods is still incentivized with some sort of system, but I think that's quite possible if we can manage to revamp copyright. UBI for digital goods!