Unreliable Nature Of Solar And Wind Makes Electricity More Expensive, New Study Finds

Unreliable Nature Of Solar And Wind Makes Electricity More Expensive, New Study Finds



Unreliable Nature Of Solar And Wind Makes Electricity More Expensive, New Study Finds

Wind turbines in Penonome, Panama. (Credit: Associated Press)

Solar panels and wind turbines are
making electricity significantly more expensive, a major new study by a
team of economists from the University of Chicago finds.

Renewable Portfolio Standards (RPS) "significantly increase
average retail electricity prices, with prices increasing by 11% (1.3
cents per kWh) seven years after the policy’s passage into law and 17%
(2 cents per kWh) twelve years afterward," the economists write.


The study, which has yet to go through peer-review, was done by
Michael Greenstone, Richard McDowell, and Ishan Nath. It compared states
with and without an RPS. It did so using what the economists say is
"the most comprehensive state-level dataset ever compiled" which
covered 1990 to 2015.


The cost to consumers has been staggeringly high: "All in all,
seven years after passage, consumers in the 29 states had paid $125.2
billion more for electricity than they would have in the absence of the
policy," they write.


Last year, I was the first journalist to report that solar and wind are making electricity more expensive in the United States — and for inherently physical reasons.

Solar and wind require that natural gas
plants, hydro-electric dams, batteries or some other form of reliable
power be ready at a moment’s notice to start churning out electricity
when the wind stops blowing and the sun stops shining, I noted.


And unreliability requires solar- and/or wind-heavy places like Germany, California, and Denmark to pay neighboring nations or states to take their solar and wind energy when they are producing too much of it.

My reporting was criticized — sort of
— by those who claimed I hadn't separated correlation from causation,
but the new study by a top-notch team of economists, including an
advisor to Barack Obama, proves I was right.


Previous studies were misleading, the economists note, because
they didn't "incorporate three key costs," which are the unreliability
of renewables, the large amounts of land they require, and the
displacement of cheaper "baseload" energy sources like nuclear plants.


The higher cost of electricity reflects "the costs that
renewables impose on the generation system," the economists note,
"including those associated with their intermittency, higher
transmission costs, and any stranded asset costs assigned to
ratepayers."


But are renewables cost-effective climate policy? They are not.
The economists write that "the cost per metric ton of CO2 abated exceeds
$130 in all specifications and ranges up to $460, making it at least
several times larger than conventional estimates of the social cost of
carbon."


The economists note that the Obama Administration’s core estimate
of the social cost of carbon was $50 per ton in 2019 dollars, while the
price of carbon is just $5 in the US northeast’s Regional Greenhouse
Gas Initiative (RGGI), and $15 in California’s cap-and-trade system.