Achieving Grid Parity
(Room Jupiter 8)
01 Sep 15
4:00 PM
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5:30 PM
Historically one of the key constraints with renewable energy has been the high cost compared to “conventional” technologies. This perception remains despite the fundamental shift in the base costs for fossil fuels since about 2006 and the ongoing reduction in renewable energy costs.
Large hydro has long been viewed as a cheap source of electricity however it has been joined by other forms of RE.
Assuming USD30/T for agri-waste and a high pressure, high temperature boiler, biomass costs can be below USD90-120/MWh, whilst plantation based projects using a similar boiler can be as low as USD120-140/MWh.
Wind power prices vary dramatically depending on the wind profile however rates as low as USD90-130/MWh for countries with strong wind profiles such as the Philippines and Vietnam.
Solar power prices have likewise dropped dramatically over the last 5 years and Thailand is offering a tariff of USD180/MWh.
By way of comparison the cost of electricity in Thailand, where 75% of the generation is generated by CCGT firing natural gas, the Thai government predicts that the cost of generation could spiral to USD270/MWh if natural gas remains the major fuel source due to the high cost of LNG.
Furthermore the UK government has signed a contract for 3200MW Hinkley Point C nuclear power plant with a guaranteed price of GBP92/MWh (USD140/MWh).
Although solar is marginally more expensive than nuclear it has far lower social issues and is available at a time of day that coincides with peak demand.
There are other advantages to RE that are not as easy to quantify including their ability to provide distributed generation, which reduces transmission related costs as well as having far lower environmental impacts.