[Veserv]

Their thesis is probably that solar electricity will soon be (as an example) 1/10th the price of natural gas electricity and that they believe they can get 10-30% storage/conversion efficiency. Therefore, the price of synthetic natural gas will be cheaper than current natural gas.

There are a number of acknowledged assumptions in that model and other potential problems that may make their thesis incorrect, but you have raised none of them so far nor directly refuted the thesis.

[caminante]

No.

Parent directly challenged the model because of thermodynamic loss and expense v. substitutes.

E-fuels is contingent on subsidies, and you can't just wand away costs with a renewables price decline. These plants require firmed up renewables supply shape that a solar or wind farm can't provide alone. What's that mean? $$$

Another thing, most of the metal in these facilities doesn't have a price decline curve. The ramp to parity is long and level.

[Veserv]

First, they did not seem to make a thermodynamic loss argument. They made that argument for vertical farming versus regular farming to argue that the inputs to regular farming are cheaper because they are not harvesting solar energy with extra steps. That is a perfectly cogent argument because the inputs are the same in both cases. You can not make the same argument for solar energy versus drilling costs without making the reader fill in a ridiculous number of gaps in the argument.

Even assuming they did obliquely try to make a thermodynamic loss argument, it is irrelevant. Thermodynamic efficiency is not really related to electricity costs except indirectly otherwise we would all be using ultra-expensive 30% efficiency solar panels instead of cheap as dirt 10-20% efficiency solar panels. It is a contributor, but the core question is price efficiency of the non-"drilled hydrocarbon" energy commodity.

The thesis is that non-subsidized solar energy-derived electricity will be cheap enough relative to hydrocarbon synthesis efficiency that it will be cheaper to synthesize than drilling it out of the ground (at current prices). There are many ways to reject that thesis, of which you present at least a few, but the comment I was responding to did not bring them up.

Given their other responses, they keep acting as if the thesis is: "We will make synthetic hydrocarbons that are 10x more expensive than harvested hydrocarbons, but we expect people to buy them anyways for reasons" which is obviously a strawman. The point of the discussion is entirely in whether it will be 10x more expensive, where one side claims it will be cost-competitive and the other side disagrees. To that end, here are some options including ones you brought up that at least provide potential counter-arguments for the actual point under contention:

1. Solar energy is actually non-viable, but subsidies make it, incorrectly, seem viable.

2. Solar energy will not continue to become cheaper exponentially and reach a low enough price.

3. Solar energy will become very cheap, but synthesis will be too cost-inefficient anyways.

4. Synthesis is cost-efficient on a per-unit basis, but requires capital intensive processes that only pay back if continuously active which solar can not provide.

5. Synthesis is only efficient at the margins right now. There is actually a lot of cheaply accessible hydrocarbons that can accept price reductions and still remain viable. All you will actually displace is a tiny edge of barely profitable hydrocarbons until there are even more significant cost reductions.

6. Solar energy cost reductions will also reduce hydrocarbon harvesting costs in a relative proportion that keeps harvesting viable.

7. They just suck at execution.

8. Something else.

[caminante]

> First, they did not seem to make a thermodynamic loss argument.

You're missing the point.

Power-to-X fuels are fundamentally energy destructive versus alternatives. And feedstock cost prices declining enough to achieve fuel price parity isn't a safe bet. That's the parent's argument.

edit:

Terraform is baiting people with very optimistic cost structures. They're promising $2.5/kg H2 and DAC at $250/ton CO2. These figures are astronomically low. Then, wait-- it's for 1MW of PV electric supply. That's not scale. This facility can turn on/off when the sun is/isn't shining? Anything to solve that is more money.

[verzali]

I've read through his thesis on his blog. There are several flaws in his analysis. The most glaring is in the cost of natural gas, for which he uses the most pessimistic value possible (that during the Ukraine war shortages) and then compares it to the most optimistic price of solar. A fairer comparison would take the cost of production and shipping of gas (which is very cheap) and compare that to the cost of synthetic gas. But if you do that synthetic gas is always more expensive than natural gas. Furthermore, many of his cost assumptions rely on government subsidies. Yes, it is possible to get cheap synthetic gas if the government subsidises it. But no, this is not a scalable product.

Even if you ignore this problem, his thesis still only makes sense if we live in a world which massively overbuilds solar panels. Some of this other pieces talk about covering the world's oceans in solar panels, which, frankly, makes little overall economic sense.

[wrsh07]

When you're projecting future costs of solar, you should be using very optimistic estimates, right?

[verzali]

Yes, but you should also use realistic prices for gas. Especially for a future in which abundant solar has driven down demand for gas.

[caminante]

You can. Your investors won't. They'll use conservative to median estimates. Doing otherwise is negligent or misleading.