Google Inc. has a new project, Renewable Energy Cheaper Than Coal. Google is preparing to bet megabucks, mega-engineers and its cutting-edge reputation on its ability to propel solar thermal power, wind turbines and other renewable electricity up the innovation curve and under the cost of coal-fired power, Reuters reported Tuesday.
"Our goal is to produce one gigawatt [1,000 megawatts] of renewable energy capacity that is cheaper than coal. We are optimistic this can be done in years, not decades," said Larry Page, Google’s co-founder and president of products, according to Reuters.
To which we at the Carbon Tax Center say: Good luck, and don’t forget to hire the lobbyists. You’re going to need them to help win a carbon tax, ’cause without the tax, your goal of renewable energy cheaper than coal is likely to remain out of reach.
Don’t look to "market forces" to jack up the cost of coal-fired power. Unlike the 1970s, when the price of coal marched in lockstep with skyrocketing oil, coal prices are stuck in a proverbial peat bog. The national average coal price so far this year, $1.77 per million btu, is barely higher in nominal terms (and 40% less in real terms) than the 1982-1985 plateau of $1.65. The resource is abundant, mining technology is technically mature (if socially and ecologically devastating), and there’s barely a mine workers union to speak of. The power plants themselves are no harder to build, even with SOx and NOx scrubbers, than my kids’ Harry Potter lego’s, they just take a few years longer.
Coal-fired power isn’t about to get much more expensive by itself. Are renewables going to get much cheaper? Arguably not — at least not enough to win Google’s bet.
What about electricity from wind, my personal favorite energy-supply source and one for which I’ve done my share of advocacy? Wind power has gotten fabulously cheaper over the past two dozen years, as this DOE cost curve attests. But the rate of decline has slowed. Past advances — taller towers to capture higher wind speeds, larger blades to sweep larger areas, gearing to grab every available erg — appear pretty much tapped out. Further declines in wind costs will be incremental, not quantum. And to compete toe-to-toe with coal as baseload power, wind will need a support system of storage and transmission that will only add to its per-kWh cost.
Photovoltaics have more cost-cutting ahead but are starting from a much higher cost plane. I’m less up to speed on solar-thermal, but I suspect it sits somewhere between wind and PV — cheaper than PV now but with less scope for innovation. The bottom line, then, as I see it, is that coal will continue to undercut renewables in cost for the foreseeable future.
Unless a price is put on coal’s head.
An average kilowatt-hour from a coal-fired power plant sends 2 pounds of CO2 into the atmosphere. A megawatt-hour (1,000 kWh) puts up a ton. Charge $10 a ton of CO2 (or $37 a ton of carbon — precisely what we at the Carbon Tax Center recommend as the yearly increase in a phased-in tax) and you lift the price per coal-fired kilowatt-hour by one cent. If the gap between wind power (sans the federal Production Tax Credit) and coal power is conservatively put at 4 cents/kWh, then $40/ton of CO2 ought to give Google its Holy Grail.
There’s already a couple of carbon tax bills rattling around the House Ways & Means Committee. The Larson bill (that’s John B. Larson of Connecticut, a member of the Democratic leadership) calls for $15/ton of CO2 in starting in 2008, with the level increasing by 10% annually along with an additional inflation-offsetting adjustment. That could bring wind halfway to parity with coal in just a few years.
Hiring genius engineers and pouring Google’s coffers into renewables are terrific moves. But nothing beats getting the prices right. Earth to Google: start pulling for a carbon tax.
Daniel Rosenblum says
Google may be betting on Congress putting a price on carbon, but there is no reason to believe it is betting on a carbon tax. Cap-and-trade, for all its problems as we detail on our website, would also put a price on carbon and would also help the economics of renewable power. I certainly hope that Google recognizes that a carbon tax is preferable to cap-and-trade, but if it just wants to put a price on carbon it can also support Lieberman-Warner or one of the other cap-and-trade bills.
David Collins says
"The Price Is Right" is OK for entertainment, but as things are, The Price Is Wrong for Carbon. Until the tube of that flat tire is fixed, climate aid ain’t going nowhere. Great engineers might increase the number of alternatives for alternative sources of energy, but that won’t reduce energy consumption, which in our part of the world will assuredly cure more ills than any snake oil could ever lay claim to. Yeah, for sure, Capt. Trade can raise the price, but only the Carbon Tax can make sure "The Price Is Right" for Carbon so that everybody goes home a winner.
From what I remember reading the price of coal is not a lot different than the price of dirt.
What google is doing is not alot different than what the publisher of penthouse was trying to do 30 years ago. He was funding the research into Fusion power and spent a bunch of millions into it until he figured, what am I doing, I got no expertise in this stuff, if highly technical companies are not investing in this, I got to be nuts. He did back out.
Just a note to the author: Solar thermal is not PV. See http://en.wikipedia.org/wiki/Solar_thermal_energy
Don’t count on Google to do anything except maximize profit.
The absence of a carbon tax is a subsidy for carbon polluters. We should more often promote it that way. People are against subsidizing profits.
Meanwhile let’s stop subsidizing autosprawl.
http://www.treehugger.com is a place where many green people gather. Those are good people. I think they are very important part of the green movement. However, I have found that many of them are overly optimistic. One of them said; "In my perspective, the ‘green movement’ is already on the winning side, and it is unstoppable." With this in mind, they are not willing to support dramatic measures such as Carbon Tax or Cap-and-trade. They are innocently believe that the technology along would be enough to defeat the fossil fuel industry. The recent Google news is their evidence that "we are winning".
Please check out my post in TreeHugger and offer your point of view. Here is the link;
To me, green is not a hobby. It is a life and death battle for future generations.
Jeff Rusch says
Google’s optimism is not unfounded, carbon tax or not. Since as you say you’re not up to speed on solar thermal, here are five solar companies that have new but real technologies that are cost competitive with coal or gas right now, with wholesale prices at or expected to be around $1 a watt. All are either already manufacturing or expect to be within a year. (Two were funded by Google.) They will all probably take a couple of years to ramp up production to gigawatt scale, but they need no technical breakthroughs to do it.
low cost solar thermal:
Coolearth solar http://www.coolearthsolar.com/
low-cost thin-film (no silicon):
AVA solar http://www.avasolar.com/
There are more out there, but these are my favorites. Happy reading, and let’s all continue to push for a carbon tax to speed them along, so that rather than being merely competitive with coal, they can trounce it in the marketplace, and get this happening as fast as possible.
Jeff Rusch says
What I meant to say in summary is we’re not lacking in cost-competitive alternative technologies, but in speed of implementation, and that’s where a carbon tax would really help.