Eugene G. Preston, PhD, PE
Transmission Adequacy Consulting
6121 Soter Parkway
Austin, Texas 78735-6100
February 22, 2011
PROJECT NO. 35792
RULEMAKING RELATING TO§PUBLIC UTILITY COMMISSION
THE GOAL FOR RENEWABLE§
ENERGY§OF TEXAS
I, Eugene Gordon Preston, writing in my capacity as a registered professional engineer in the State of Texas, and subject matter expert in electric energy, submit additional comments concerning the proposed Texas PUC Substantive Rule 25.173, Goal for Renewable Energy.
Dr. Al Bartlett, Emeritus Physics Professor at the University of Colorado, has an on-line video titled Arithmetic Population and Energy. In it he predicted 17 years ago the combination of population growth and declining oil will lead to food shortages. The recent uprisings in the Middle East were initially triggered by rising food prices before expanding to other pent up social issues. The rising food prices are directly linked to increasing oil prices. It’s very likely we are at the forefront of a worldwide food production crisis, largely driven by increasing oil prices.
Dr. Bartlett goes on to show that the US coal supplies are being depleted at a much more rapid rate, shortening the once 500 year supply predictions down to just a few decades. Current studies track Dr. Bartlett’s predictions. As ever-thinner seams are mined, the costs and environmental impacts increase, and the life of coal power shortens.
Aubrey McClendon, CEO of Chesapeake Energy, recently stated on a CBS 60 Minutes presentation that natural gas from fracturing would take care of the US energy for 20 years. What do we do after 20 years? We are blessed to have this new energy source; however, it is not renewable and we are exhausting it at a very rapid rate, thus the reason for its short life.
The above information suggests we should decrease our current dependence on gas, coal, and oil (for transportation and food) to supply our future energy needs.
The problem with renewables is that their capital costs are higher than the cost of power from existing gas and coal sources. From my earlier testimony, a 12,000 annual kWh rooftop solar power source will cost $60,000, off site tracking solar PV will cost $22,000, and nuclear will cost about $7500 (ignoring nuclear fuel and O&M which is less than 2 cents/kWh).
Who can afford solar rooftop renewable energy? To simplify this example, let’s assume that half the population can afford to pay for rooftop solar (rich folks) and the other half cannot (poor folks). Assume that all the rich folks do install rooftop solar and assume that half the cost of the rooftop solar is subsidized. Through increased rates, poor folks wind up paying 1/4th the cost of the rooftop panels installed by rich folks. On average, each poor person will pay $15,000 to a rich person to help pay for the rich person’s rooftop solar panels. This doesn’t make sense.
How much single axis solar PV power can ERCOT accommodate? The answer is at least 12,500 MW by 2020 and probably more. If half of the 25 million people in Texas bought a piece of the 12,500 MW total, then each of the 12.5 million people able to afford solar would be purchasing 1 kW, and the cost would be about $4000 per person. The individuals offering to purchase this capacity would need to do so directly, because if the utilities tried to pass the cost on through rates, then the poor folks would wind up paying half the cost or about $2000 per person, which would be an increased cost they could not afford. Therefore, by letting individuals pay up front the $4000 cost per kW, we would avoid the rate increase that harms poor folks.
Why would individuals want to buy off site solar? For many reasons. 1) because the off site solar has considerably lower energy cost than rooftop solar panels, 2) because they can and they have the money, 3) because their current residence is not suitable for solar panels, 4) because the purchase is not permanently tied to just one residence, 5) because they want to make a contribution to solving the climate change problem, and others.
How much nuclear power can ERCOT accommodate? Let’s say that the same people who bought $4000 solar could also afford another $4000 for nuclear at $5/watt. That would be 800 watts per person. If 12.5 million people purchased 800 watts of nuclear the total would be 10,000 MW. This would be about four nuclear plants of the size proposed for STP 3 and 4. ERCOT could easily use another 10,000 MW of nuclear power by 2020 which would greatly improve the reliability of our power supply.
Why would individuals want to buy directly into a nuclear plant? Surveys show that Texans believe nuclear power is necessary to solve the energy and climate change problems. By owning their own piece of a nuclear plant, the individuals are locking in the capital cost for the next 40 years. Their monthly bills will be significantly reduced in future years.
Why is more nuclear power in Texas necessary? Nuclear power is needed to replace the aging base load coal plants in Texas. Wind is too intermittent for it to act as a reliable source of base load power. Natural gas is too valuable a resource to waste it as a source of base load power when in combo with wind. New coal plants with carbon capture are not likely to be economical compared to new nuclear plants. Utilities will be reluctant to invest in carbon capture retrofits on old coal plants. New nuclear plant designs passing NRC approval, such as the AP 1000, are stable and at low risk of the kinds of cost overruns we saw in the past.
To the PUC and Power Companies: The solar and nuclear plan only works if individual customers are allowed to invest in off site solar and nuclear power. If the utilities finance these projects, then the poor folks are harmed. Subsidies should be stopped for rooftop solar because the costs are unfairly passed down to the poor folks.
Sincerely,
Eugene G. Preston
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