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Originally Posted by Tron_fdc
Last time I looked at wind power was in 1999 on the eve of deregulation. We went so far as purchasing land in Ft Mcleod, got a space allocation from Transalta to a local transformer, and engineered the site for a 10 MW wind farm. We ran an anemometer for 3 years gathering wind data that we could present to the bank for a loan (around 10 million at the time).
At the end of the 3 years we overlaid all the data (wind speed and duration) on the spot price of power to check the economics. It made sense, but barely. I believe the price had to be $0.08/kWh to be viable. No bank would touch us to go ahead with the development.
We ended up selling the data to a private company who spun it off to Enmax who had a project nearby, and also sold our "spot" in line on the transmission end. We also sold the land at about a 200% profit to the hutterites for a cattle farm, so that was nice.
Looking at the spot price these days and taking into account inflation on the manufacturing end for the turbines, I have a real tough time believing it's anywhere near viable let alone profitable. I would have to see the actual numbers, but without heavy subsidies I don't see private industries touching it.
Another factor to consider is the location. You can't just stick a wind tower wherever it's windy; you need the distribution infrastructure to service it. Last I checked (admittedly 10 years ago) the windiest spots in Alberta (Pincher Creek to Lethbridge) we using up all the available capacity. There are viable sites, but no way to get it to the grid and on the market.
So that all begs the question: Who pays for all this? I love renewables, but it's a tough sell economically to private business or to the average joe who doesn't want to see tax increases (especially now) to subsidize the generation and transfer of renewable energy.
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This is the most recent broad-based assessment of specific generating technology costs:
https://www.iea.org/Textbase/npsum/ElecCost2015SUM.pdf
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Finally, this report clearly demonstrates that the cost of renewable technologies – in particular solar photovoltaic – have declined significantly over the past five years, and that these technologiesare no longer cost outliers.
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Take a look at the wind numbers. If you believe the findings then wind looks to be right in line with competing generation technologies. Of course, this is an aggregate across many countries and the specific costs are, as you say, reliant on the local geography and wind resource.
However, it doesn't really stand to pass that wind is such a cost-outlier as you paint.
The point to really debate in that analysis is how accurate are the nuclear numbers? It seems incredibly cheap, but then you look at real world construction costs happening right now and something doesn't square.
Hinkley point in the UK is delayed again. EDF is effectively insolvent from the Flammanville nuclear plant it's trying to build. The only nuclear that looks to be in that cost range is in China. But why is so cheap in China, part of me just does not want to know.