Tesla Just Got The Highest Rating Consumer Reports Has Ever Given

Wow!  Not much else to say.  See here – It broke their scoring system and scored 103.

I have been writing about this great car for some time.  Of course I have lots of company but it has been a fun ride.  Here is a piece where I concisely discuss many of the amazing feats that Tesla has accomplished.

See Also Tesla Again?!

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Load Shifting With Electric Vehicles is a Great Match to Wind in Many Areas

Much of the best wind resource in the country peaks at night time.  To date this has proven challenging for the Texas electricity grid management.  It has been resolved somewhat due to transmission grid upgrades but still promises to limit wind power development in Texas.  Electric Vehicles, together with night time charging rates may create a path to much higher amounts of wind power being added to the Texas utility grid.  If Time of Use Metering us utilized, the car owner’s cost of ownership decreases.  This is in contrast to V2G scenarios which reduce battery lifetime.  In other words this is a way that the utilities can get lots of storage essentially for free.

Load Shifting With Electric Vehicles is a Great Match to Wind in Many Areas.

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Great Graphics on Electricity in the US

These graphics found there way to me on Facebook:


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Texas Transmission Line Upgrades Slash Wind Curtailment

aa Logo CT-TEC-RENEFeatured on:  CleanTechnica, REneweconomy, and The Energy Collective,

By Clayton Handleman

It is August and that means the latest version of The Wind Technologies Market Report (WTMR) has been released by the US DOE’s Energy Efficiency and Renewable Energy (EERE) office.  The WTMR is a chronicle of growth and economic and technology trends in the wind industry.  Wind power has begun taking its place as a substantial contributor to electricity generation in the US.  Due to its intermittent nature there is an increasing, and some suggest, premature, concern over limits on penetration.  This is probably driven in large part by the large amounts of curtailment in Texas in 2009.  The 2014 WTMR may put some of those concerns to rest.  Data in the report show that in Texas, curtailment has been slashed from 17% in 2009 to 0.5% in 2014 (figure 1).  This occurred despite the backdrop of increased wind generation in Texas.  It was due in large part to bringing added transmission online.

Wind 2014 Curtailment GraphFigure 1:  Changes in wind curtailment by date.  Texas’ wind curtailment is labeled ERCOT.  WTMR p38

The improvement was no  accident.  As wind became valued as an important contributor to the Texas generation portfolio, it became apparent that to fully benefit from wind they would need to build transmission lines from where the best generation sites were to the population centers where it would be used.  The Electric Reliability Council of Texas (ERCOT) set about defining Competitive Renewable Energy Zones (CREZ) and creating an electric transmission plan to assure that the electricity could get from the CREZs to point of use.  The transmission lines have now been built and have nearly zeroed out the need to curtail wind generation.

ERCOT publishes quarterly progress reports for the CREZ program HERE .  In the summary maps below (figures 1,2,3) it is easy to track progress over time of the transmission line build out.  Comparing these to the data in figure 1 it is clear that the new transmission has successfully cleared the congestion that was limiting the use of wind generation.  Perhaps most impressive is that the substantial reductions in curtailment occurred at the same time that wind energy generation increased by almost 100% (Figure 5 below).

Wind 2014 CREZ Progress

Figure 2:  CREZ transmission line project status  November 2014 – Complete – Public Utility Commission of Texas

Wind 2013 CREZ Progress

Figure 3: CREZ transmission line project status October 2013 – Partially Complete – Public Utility Commission of Texas

Wind 2012 CREZ Progress

Figure 4: CREZ transmission line project status October 2012 – Partially Complete – Public Utility Commission of Texas


Figure 5: Texas Wind Capacity and total generation.  EIA

Original Article

An interesting graphic that provides insights into how renewables “play” together

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New NREL Data Suggests Wind Could Replace Coal as Nations Primary Generation Source


aa CT GTM TEC RENEFeatured on: Greentechmedia, REneweconomy, and The Energy Collective, CleanTechnica

I have made some updates in response to feedback from commenters.  These can be identified by the red NOTE designator.

By Clayton Handleman

The National Renewable Energy Laboratory (NREL) recently released data showing that the Capacity Factor (CF) for wind power can reach 65% which is comparable to that of fossil fuel based generation .  While the headlines aren’t as sexy as Tesla’s ‘Ludicrous mode‘, the transformative implications for climate change dwarf Elon Musk’s latest accomplishment.  Increasing a generator’s CF can increase its value in a variety of ways including: reduced cost of energy, improved transmission line utilization, and often, reducing stress on the grid by providing more power at times of peak demand.  It will also likely reduce the amount of storage and natural gas needed to manage the grid under scenarios of high renewables penetration.  Implicitly, NREL’s new report positions wind to become a dominant and possibly the primary source of electricity in the US.

Wind Potential Chart US 072015Figure 1:  Graph showing the area of the US with various gross capacity factors for differing wind technologies.  The curve to the left shows the historical data, the middle (red) curve shows the data for state-of-the-art turbines and the blue shows the anticipated performance of ‘near future’ turbines.  NOTE:  You can obtain a similar graph for each state by clicking on the individual states HERE .

CF is the ratio of a generator’s average power output over a year period to its nameplate rating.  A CF of 100% would indicate that it was always on and operating at its full rated power.  Simply stated, higher capacity factor means a given size generator will produce more energy over the year.  CF sets a lower bound on the amount of time a generator operates.  If a generator is not operating at its full nameplate rating all of the time then it will produce power for a percentage of time that exceeds its CF. *

Implicitly, NREL’s new report positions wind to become a dominant and possibly the primary source of electricity in the US.

With little fanfare, NREL released updated data showing that, with current technology, wind turbines could generate more than enough energy at 55% CF to power the entire US.  However the real stunner is that near future turbine technology (140 m towers) could boost that to 65% CF.  With the current national average wind CF (pg 34) at about 33%, this represents a near doubling.  According to NREL using current technology and siting it in prime locations, wind power CF already can exceed that of natural gas.  Using ‘near future’ technology wind power’s CF will exceed the CF of both coal (61%) and natural gas (48%) achieved nationwide in recent years.

NOTE:  It is important to keep in mind that fossil fuel plants are dispatchable and often their output is reduced in response to reduced demand. So their theoretical maximum CF is often more than what is realized in practice. This also occurs for wind through curtailment, but at current penetrations to a lesser degree. These distinctions are quantified by utilities using a metric called Capacity Credits which are discussed below.

Taking CF into account, on an energy basis, there is enough land suitable for siting 65% CF turbines to supply the nations electrical energy needs.  From NREL’s new data, figure 1 shows how our understanding of wind’s potential is rapidly evolving.  Advances in turbine technology are leading to taller turbines which can access the steadier, higher average speed winds at higher altitudes.  Using figure 1 and data from this study, one finds that there is enough land available to site turbines with 1.5 TW capacity and 65% CF.  At 55% CF there is enough land with sufficient resource to site roughly 3 times that or about 4.5 TW.  For perspective, the average US electrical net generation was less than 0.5 TW in 2012.    Even with higher CF, wind power is not dispatchable and therefor will not eliminate the need for other sources.  However it can dramatically reduce the percentage of generation from fossil fuels.

Coal and natural gas are currently the country’s primary generation sources.  According to the EIA, in 2014, coal power plants produced 39% of the nation’s electrical energy with gas in second place at 27%.  Some reputable authors argue that current economics (which do not consider load shifting) places a limit on the upper bound of renewables penetration equal to their capacity factor.  That criteria sets an upper bound for wind power’s contribution to the nation’s electric supply at 65% of the total.  However, in the near term the limiting factor may be technical.  A DOE funded study by GE suggests that the grid can tolerate about 55% wind and solar with the total being raised to 61% if the grid were reinforced with commercially available improvements.  Using either metric and technology available today, the only remaining barrier to wind becoming the nation’s largest energy source is transmission capacity.


The best wind resource is in the Great Plains Region (GPR) but the largest loads are on the coasts.  For the most part the economics of low CF wind power has required that it be built relatively close to existing transmission lines rather than building new lines.  So only a small fraction of the country’s best wind sites have been developed to date. To get the power from source to load will require expanding the transmission grid.  This will include adding dedicated transmission lines.  In the past it has been argued that these lines would be underutilized and therefor comparatively costly on a dollars-per-MWhr basis.  High CF wind improves the overall economics of dedicated transmission lines by using a higher percentage of their available capacity.

With high CF wind cost improvement for transmitting power is roughly proportional to the improvement in the CF.  So doubling the capacity factor approximately doubles the transmission line utilization.  This, in turn, halves the cost per unit of energy transferred. The GPR tends to have the lowest population density.  Not surprisingly there is little transmission access since very little electricity is required by the residents.

Developing the high CF sites will require new transmission lines capable of shipping high volumes of electrical power long distances and / or connecting to larger existing transmission assets.  In the past people have expressed concern about building transmission lines due to under-utilization.  The higher CF wind now elevates wind to levels of transmission line utilization comparable to that of traditional sources.  For perspective, with wind power being produced at 65% capacity factor it will utilize the transmission assets at about 65% while traditionally the transmission infrastructure is utilized at about 60%.

As icing on the cake, there is already some transmission line upgrade activity under way.  This is particularly true in Texas, which has upgraded transmission capacity specifically to expand their use of wind power.  The new data suggests that as the near future turbines are commercialized these transmission projects will have better economics than originally planned.


Recall that CF is the ratio of a turbine’s mean power production divided by its nameplate rating.  All other things equal, if a generator runs at a high capacity factor, the economics improve.  For example, a 3 MW wind turbine running at 33% capacity factor and charging $30 / MWhr for electricity will generate about $260,000 in annual revenue.  That same turbine running at 65% capacity factor would produce $512,000.  Alternatively it could charge $15.5 / MWhr and end up with the same profits as the 33% CF unit making it more competitive.  When transmission capacity is available, the economics of wind are already quite good in the GPR.  Moving to ‘near future’ turbines will likely further improve those economics.

Wind PPA Prices through Jan 2014Figure 2:  Levelized wind PPA prices by PPA execution date and region.  The interior region is shown as purple circles.

Figure 2 shows that recent Power Purchase Agreements (PPAs) have been coming in under $30 / MWhr in that region.  The industry trend has been larger turbines and lower costs.  While it is the case that land based turbine size has stalled at about 3 MW that is due to the transportation challenges of getting the turbines to site.  One aspect of the ‘near future‘ turbines is that they are designed to address the transportation issues.  NREL apparently sees sufficient promise and progress to refer to the required technology as ‘near future’.  No doubt Europe’s success at commercializing turbines with 140m hub heights adds to their confidence.


The Capacity Credit (CC) is the metric used by utilities to account for a generator’s intermittency and its ability (or inability) to provide power at times of peak demand.**  The topic of CC (often found by determining the Electric Load Carrying Capability ELCC ) is very important in utility planning and valuing of generation assets.  It is discussed in detail here.  It has to do with the fraction of a generator’s rated capacity that can be relied upon as available by the utility when it is most needed.  The best approaches for calculating it look not only at the availability of the generator throughout the year, CF, but how well that availability correlates with peak demand on the grid.  It is a complex business and is best done with real data.  However, in the absence of real data, analytical techniques are used by utilities to begin planning and then the CC is corrected with data as generation is brought online.

It is worth considering that the increase in CC from today’s value could be more than 100% if the increased generation occurs at times that the grid is in most need of power.  This in turn will increase wind power’s value and the degree of penetration that can be readily accommodated by the grid.  In the southern GPR, e.g. TX, OK and KS, the wind tends to blow more at night which is off peak.  However, one benefit of taller turbines is that they reach regions of steadier wind.  This will tend to increase wind speeds during the day which will contribute more to the CC than increases at night.  When all is said and done, real data will be required to determine the degree to which the CC will increase.  However it is very likely that it will increase substantially and that it will increase the amount of wind that can usefully and economically be added to the system.


The new CF numbers from NREL dramatically shift the landscape for how to proceed with energy policy in the US.  Older studies such as EWITS are now obsolete.  They used numbers similar to the black line in figure 1 and ignored the storage and load shifting potential of electric vehicles.  In those studies, wind penetration up to about 30% was examined and presented as reasonable to pursue.  Using the blue line in figure 1 with 65% capacity factor indicates that higher, probably much higher, penetrations can be achieved and at lower cost than previously anticipated.  The capacity credit that can be assigned to this resource will go a long way towards determining whether the ramifications of the new data are evolutionary or revolutionary.  However the new NREL data, whether evolutionary or revolutionary, significantly strengthens the case for increasing the rate of expansion of wind power in the US energy portfolio.

AUTHOR’S NOTE:  While this article covers the extraordinary opportunity in the GPR, new turbine technology is also opening up opportunities in regions previously not considered suitable for wind power development.  See more details Here and Here.


* In practice, intermittent renewables rarely operate at their full nameplate rating.  That means that the percent of time they are operating is greater than the rated Capacity Factor (CF).  To illustrate, lets consider two different examples of a generator operating at 50% capacity factor:

Case 1: The generator runs at full power for 50% of the time and generates nothing the rest of the time.

Case 2 The generator runs at 50% of rated power all of the time and is never off. In case 1 the percent of time that the generator runs is equal to the capacity factor.  In case 2 the percent of time that the generator runs is twice the capacity factor.

** Lets expand upon the discussion of CF above*, to gain insight into what Capacity Credits (CCs) are, and how they are useful in utility planning.  CCs are a critical tool used by utilities to assess generation assets to assure reliability of the electric grid.  Loosely speaking CCs are a way of assessing a generator’s intermittency, dispatchability and reliability in one metric.  To illustrate we look at case 1 and 2 from above but will split Case 1 into two sub cases.  In Case 1a the time that the generator is on perfectly corresponds to the time of the utility’s peak demand and in Case 1b the time the generator is on never coincides with the time of peak demand.

Case 1a: The generator runs at full power for 50% of the time and generates nothing the rest of the time.  The time that the generator is running coincides with all periods of peak demand on the grid.  This generator would receive a substantial CC possibly higher than 100%.

Case 1b: The generator runs at full power for 50% of the time and generates nothing the rest of the time. The times that the generator produces power are low demand.  This generator probably would receive a CC of 0.

Case 2: The generator runs at 50% of rated power all of the time and is never off.  This generator reliably produces power at times of peak need but only at 1/2 of the generator’s rating.  It would probably receive a CC in the mid range.

Obama, obama climate plan, climate plan, climate change, Obama’s Climate Plan, Climate Protection Plan, CPP, Obama’s CPP

HERE is an article on GE’s recent program to develop a super tall wind turbine to harness high capacity factor wind power.

HERE is an update from Scientific American about the march to lower prices for wind power.  This includes a graph showing how the ERCOT transmission upgrades reduced curtailment while penetration increased.

HERE is an article in technology review that discusses the importance and potential of HVDC power transmission.

HERE is a piece that shows that Many of the best sites are least populated.  Very few people will have their views impacted.

HERE is an interesting piece that drew on this article.

HERE is an article that talks about how tall turbines with higher CF also open up other areas to cost effective development such as the Southeast US.

Lots of great myth debunking at this site:

Renewable Energy Futures site has some interesting graphics here showing aggregation of renewable energy sources:

European Capacity Factors HERE

HERE is a site by a long time, world respected expert on wind power.  Paul Gipe

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Great Plains Wind, No Problem for the Neighbors

Any two of the top 7 states in the Great Plains Region (GPR) could supply the entire electrical energy needs of the US from wind power.  But at what cost in terms of quality of life for the residents?  Not much it turns out.  The best sites have some of the lowest population densities in the country.  In addition much of the land is used for farming, ranching or hydrocarbon development.  Wind is symbiotic with those uses due to its small footprint and provides revenue for the land owners.   Finally, the best sites are well away from interstates and vacation destinations. Even very large deployments of wind turbines can be sited to have little impact on the vacationing public.  Further, landowners with a stake in the game tend to have positive feelings towards wind power so development in the GPR will have little hardship. Compared to other generation options the impact of wind turbines on residents in the GPR is pretty benign.

US Population Density Compared To Wind annotated

Figure  1: Comparison showing that the best wind sites correlate extremely well with the areas of lowest population density.  Click the image to enlarge.

The GPR offer some of the world’s best wind resource .  A surprisingly large region of the GPR is capable of delivering wind with a capacity factor 55% and near term advances in turbines are expected to yield 65% capacity factor wind.    This compares to a national average of about 33%.  The implications are that, GPR wind turbines can generate over 50% more electricity, than the national average and near term improvements  will push that closer to 100%.  That means that it will be lower cost and will make better use of transmission assets.  Currently PPAs are offering GPR wind power for as little as $25 per MWhr or, equivalently $0.025 / kwhr.

Use of the best Great Plains sites has been the limited due to lack of proximity of transmission lines to take the power to large loads (such as the East Coast).  That is changing.   Transmission infrastructure is being expanded and there are credible efforts to build HVDC transmission lines to carry large amounts of power East.  In Texas they have upgraded their power transmission system to carry 18GW of wind power.  But if wind is to become one of the nation’s primary generation assets capacity will need to increase by more than an order of magnitude.

Some distort the ramifications of this by suggesting that the space required is enormous and places an undue and unfair burden on the residents.  While it is true that the turbines will be spread over a geographically large region, only a small fraction of that land will be taken out of service. The rest will used in the same way as it had prior to the arrival of the wind turbines.  In nearly all cases, the land owners will economically benefit.  Studies have found that when land owners economically benefit their objections to wind power drop dramatically.  Figure 2 provides a sample of what is typical when sampling the reaction of land owners to wind development.

Wind Response to Noise - PedersenFigure 2:  Response to wind power is highly correlated to economic benefit.  Pederson et al.

Great Plains siting of wind turbines will impact very few people and the majority of those who will be affected will directly benefit . In large swaths of the Great Plains, there is less than 1 family per square mile.   Much of the land is in use either for industrial scale agriculture or for oil and gas development.  And much of the agriculture is drip irrigation using circular plots which leave the corners available for the turbines. Google earth provides and excellent resource for evaluating the land use and coverage.  It is readily apparent that the best sites are either remote, used compatibly with agriculture, or both. Population map:

US Population Density by CountyFigure 3:   US population density by county throughout the USA.  Population density map info HERE .

US Population Density by Census BlockFigure 4:   US population density by Census block.  Note clustering by the roads and rivers indicating that the population in remote areas, illustrated in the county map, tends to cluster and much of the county is even less population dense. Credit Harry Kao

US KS Farm SizeFigure  5: KS Farm Size

US Farm Size

Figure  6: US Farm Size

It is helpful to compare the population density where the turbines are now to the suggested Great Plains sites.  The map below gives a good sense of the distribution of wind farms throughout the country.  Notice the sites in scenic regions heavily traveled by vacationers in VT, NY, and MA.  Also, even the rural areas of IL and IA have significantly higher population density suggesting that people live in the areas who are not financially benefiting directly from the wind turbines as they do in the agricultural areas of SW KS for example. Wind Development 2012Figure 7:  The map above shows where wind farms had been built as of 2012.   

Note that in KS the population in the SW corner, where the best wind is, is concentrated in the 3 towns of Liberal, Dodge City, and Garden City.  The rest of the region is dominated by drip irrigation farms which are highly compatible with wind turbines since the corners are often not cultivated.  The farms in KS for example, can be viewed on Google Earth and observed to have fewer than 1 dwelling per square mile, in other words, extraordinarily scarcely populated.  And while the Grand Canyon can make similar claims of low population density, Southeastern KS is not a tourist destination.  And the bulk of people taking in KS for transcontinental vacation drives, do so from Rte. 70 far to the North. NE’s Cherry county is larger than CT yet has a population of about 6000 mostly in the county seat of Valentine.  Much of the population is concentrated in the county seat of Valentine.  Many are families so the dwelling density outside of Valentine is under 1 dwelling per 4 miles. Photo of drip irrigation and then higher altitude photos of many drip irrigation: Wind Remote Siting TX drip irrigation

Figure 8: Photo showing wind turbines and large farms coexisting.

Drip irrigation, common in most of the areas that are excellent wind sites, is highly compatible with wind. Prime KS Farmland is also prime KS Wind land.  Much of SW KS, the region with the best wind resource is sparsely populated.  The region is summarized with images below.  The first provides a sense of scale of the area showing about 250 square miles with no major roads.  The next image is zoomed in to show the style of farming.  7 1/2 square miles are shown.  Some structures are apparent.  However the next image zooms in for a closer view and shows that the structures are service structures not homes.  While there are some homes in the region, the vast majority of structures are service structures, wells or Oil and Gas service structures.  Building out this area in wind turbines will have negligible impact on quality of life.

KS Farmland Figure 9: P~250 square miles of KS farms:

KS Dwelling Free 7-5 sq mile

Figure 10: P 7.5 square miles of farms with structures visible.

KS Farm Service Structures Figure 11: P Zoom in showing structures to be service structures not dwellings. Land despoiled due to drilling.

TX Wind gas and agricultureFigure 12: P Roughly 200 square miles of drilling in TX:

TX hydrocarbonFigure 13: P Hydrocarbon Impact on TX up close:

We distinguish between Direct Impact Area and Total Wind Plant Area.  The Direct Impact area is land disturbed taken out of use for the lifetime of the wind farm.  This is area is very small, among the smallest of all electricity generation sources.  The Total Wind Plant Area is the coverage area and is relevant when talking about quality of life issues.  It is the area taken up by the wind farm.  All but the Direct Impact Area is available for other uses such as ranching, farming and hydrocarbon development.  To assess the total coverage area we assume that the turbines will be sited with 100m or higher towers allowing for 50% CF.  For coverage area we use 10 MW / mi^2.*  Consider a high wind penetration scenario of 50% on an energy basis.  The EIA projects 5 Trillion kwhrs of electricity will be used in 2040.  This is roughly 20% above today’s usage.  Under this scenario if electricity generation were 50% wind it would require generation of 2.5 Trillion kwhrs.  Dividing by hours in a year and assuming 100% capacity factor this would require 300 GW of generation.  However we are assuming 50% capacity factor so this needs to be doubled to 600 GW nameplate capacity.  Using 10 MW / mi^2 this yeilds 60,000 mi^2 of coverage area or about 250 miles square.

Use Overlay for USAFigure 14:  Land Use of wind in the US.  The small square in KS is the amount of land Directly by enough wind turbines to provide 50% of the US electricity needs.  The 5 large squares show the Total Impact Area.  That is, the total area required for the wind farms.

The Direct Impact area is much smaller.  Using the NREL numbers and adjusting for capacity factor it comes out to about 256 MW / mi^2.  However the study was based upon windpower with a 30% CF and we are assuming 50%CF so this increases the power to 425 MW / mi^2.  Powering half of the country with wind in 2040 would require about 300GW of generation.  This gives a direct impact area of 700 mi^2 which is equivalent to a square approximately 27 miles on a side.

Wind Coverage area



Primary points: – The best sites for wind are in sparsely populated areas. – Visual pollution is a red herring and perpetuated by people who are trying to fight wind on an emotional rather than factual basis. – When compared with fossil fuel sources challenges, such as power plants sited in urban and suburban areas and mountain top removal, wind has the lowest impact.  While there is a great deal of anti-wind sentiment, there is clearly a systematic effort at making emotional appeals to dissuade people from using it.  When the full spectrum of externalities are taken into account, wind, well, it simply blows away the competition.

This Post offers an overview of the comparative land use requirements for various generation technologies.

This paper looks at land use requirements for wind power based upon 2009 data.  It should be used as an upper bound since the regions discussed in this post are selected for their higher than typical capacity factors which yield lower land use requirements.

NIMBY, Land Use, Great Plains, Central Region


Posted in New Energy Paradigm | 9 Comments

Nuclear – Miscellaneous Commentary and Links

My focus has been on building a free market for generation and promoting renewables due to their very low environmental footprint.  I have a variety of reservations about nuclear power with proliferation being the biggest.

Radiation – This article suggests that fears of radiation risks are overblown.

Costs and Cost Over Runs

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Ocean Thermal

Ocean Thermal Energy is an interesting technology.  This post on The Energy Collective covers many of the details.  However I think it unlikely that it will be pursued aggressively.  The infrastructure that would need to be put in place would address most of the issues hindering 100 % adoption of solar and wind.  But hey are already mature and so could be pursued with lower risk.  The author also points out some additional environmental benefits to OTEC that are worth considering.

Some thoughts I have in response to the Ocean Thermal concept are as follows:

I think there are a few fundamental weaknesses to the overall concept in comparison to others, wind and solar in particular.

1) Once it is decided to build a hydrogen energy economy, intermittency and CF are no longer at issue and $ / MWhr becomes the primary evaluative figure of merit.  With a hydrogen based energy economy, solar and wind are no longer constrained by intermittency since the energy is stored as hydrogen and easily dispatched in a highly responsive as needed basis.

2) Your cost figures appear to be based upon projections for OTEC at scale where solar and wind are based upon (almost) up to date numbers.  Lazards puts utility scale solar at $72 / MWhr with projections only 3 years out at $60.  Your proposal assumes both hydrogen and HVDC.  Under the assumption of that infrastructure wind power can be land based and land based wind is currently at $37 / MWhr at favorable sites. PPAs are already beating this even when adjusted for PTC.  The experience curve for wind is about $14% per cumulative doubling of deployment.

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Rare Earths



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Tesla Powerwall, What Does It Mean?

Photo Credit – strom-report/#tesla

By Clayton Handleman

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What is the significance of the Tesla Powerwall storage appliance and what does it mean for the future of energy and Tesla?  Travis Hoium covered a great deal in his Motley Fool article.  He points out that at today’s electricity prices the Powerwall is a boutique product.  It is not economical.  If you want backup, a generator is much less expensive.  In fact, the only justification for battery backup of this kind today is for niche markets with very high electric rates (such as Hawaii) and for commercial entities to reduce demand charges.  But Tesla introduced a battery backup solution for demand charges almost 2 years ago.  So what is Elon Musk up to?

There are 4 reasons for the PowerWall:

1) Market creation: The renewable energy buzz is strong right now.  For years, solar energy has been a niche market and the mainstream has been mildly curious about it.  Low prices, residential PPAs and great marketing by companies such as Solar City has mainstreamed solar.  Now the question in the public’s mind is “what about night time”.  Just as the Supercharger network solves a non-problem (at least for the vast majority of EV owners), Powerwall solves what is currently a non-problem for the renewables industry.  It is a product that manages public perception.  Musk doesn’t advertise but everything he does is marketing.  And powerwall is about marketing and technology development.

2) Technology Development Targeting Future Markets:  In cars the progression of products has been cleverly designed for the company to learn / create the technology for mass market products.  In storage they are following a similar road-map.  Tesla makes no secret of its auto road map.  The Roadster targeted a tiny boutique market of cool in order to develop a technology baseline for future plans.  The Model S was designed to teach the company how to mass produce cars in moderate volume.  The Model 3, due for release in 2017 is targeted at high rates of production and the mainstream.  Think of Powerwall as Tesla’s model S for their storage business.  The Powerwall equivalent of the model C will develop as battery prices are driven down by volume in the EV industry.

3) To Drive Grid Storage Policy Development:  With an operational real world example of the technology in the marketplace, policy makers have something tangible to give policy development traction and reduce risk.

4) A Test Market Exists to Act as a Laboratory:  California’s Grid Energy Storage mandate pretty much assures a market of sufficient size that Tesla can do a real world test of Powerwall.  In other words, they can do a large pilot test without incurring significant losses.

What does it mean?  This is analogous to the introduction of the MacIntosh computer in the 1980’s.  The early Macs had questionable economics.  For the $2500 price tag you could buy a lot of hours paying someone to type and even do graphic layups of documents.  But most recognized immediately that the MacIntosh represented the template of the future.  While its economics were questionable initially, the passionate niche of early adopters assured that the paradigm shift took hold and offered the niche market needed to drive the technology to maturation.

Powerwall is revolutionary only in its timing, who is doing it, and the fact that Musk and company offers the leadership and credibility to disrupt the energy industry and lead us down a path to clean distributed energy.  Looking at battery pricing trends and solar deployment trends, it appears that batteries will drop in price sufficiently to be a solution about the time that the storage ‘non-problem’ morphs into a storage problem.

Here is Elon Musk introducing the Powerwall

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