From the MANHATTAN CONTRIAN
In a post a few weeks ago on December 21st, I noted that the country of Germany appears to have won the race among all countries and states to be the first to reach the “Green Energy Wall”. Its pursuit of the “renewable” wind and solar power fantasy has landed the company in a situation where regular wind/solar droughts result in huge electricity price spikes and major industries are no longer competitive. It has no solution to its impasse and cannot move forward.
If Germany has “hit the wall,” what would be the appropriate analogy for New York? New York passed its climate law in 2019 with great fanfare. The law stipulates that we should have a “net-zero” energy system by 2050, with transition periods along the way. The first serious deadline comes in 2030, where the official target is for 70% of electricity generation to come from “renewables” (also known as “70 x 30”). This deadline is only five years away. Last year, all efforts to reach the 70 x 30 goal failed, and anyone who had thought critically about the issue knew that this would inevitably happen. But no one in authority has been willing to acknowledge that this has become a farce.
Here's my comparison: New York is like the cartoon character Wile E. Coyote, who ran off the cliff and is now floating in the air, apparently not knowing what will happen next.
We know what's coming next: He'll crash to Earth shortly.
Consider some data points:
Procurement of offshore wind turbines
The scoping plan developed as part of the climate law envisages around 9,000 MW of offshore wind energy by 2035. People with elementary school level arithmetic skills knew that this amount of intermittent generation would not be nearly enough to replace the amounts of intermittent generation that are scheduled to be turned off; but perhaps that would at least be a serious start. As of early 2023, it was reported that approximately 4,300 of the 9,000 MW were in “active development”, with wholesale prices in the region of US$100/MWh having been agreed with developers.
But then reality began to take hold. In this October 15, 2023 post, I reported that “essentially all” developers of the 4300 MW offshore wind in “active development” had backed out and demanded price increases in the range of 30-50% to continue. New York rejected this maneuver, but ultimately had no choice but to rebid the contracts and receive offers of the magnitude demanded by the developers.
On February 29, 2024, the state announced that it had accepted rebids for two of the projects in question, for a total of only about 1,700 MW and at a price of over $150 per MWh. (This price level would require retail electricity prices on the order of at least $0.40 per kWh and would be completely uneconomical if it became the norm for electricity production in New York.)
Meanwhile, the rest of offshore wind procurement appears to be in complete disarray. On April 19, E&E News reported that New York had canceled efforts in three of its major offshore wind development areas, Attentive Energy, Community Offshore Wind and Excelsior Wind. These three, had they continued, would have achieved a total of about 4,000 MW of the 2035 target of 9,000 MW. Abstract:
New York canceled power contracts for three offshore wind projects on Friday, citing a turbine maker's plans to scrap its largest machines. The news is a major blow to the U.S. offshore wind industry and a major setback to the climate ambitions of New York – and President Joe Biden. The three projects would have provided the state with 4 gigawatts of offshore wind power, nearly half of New York's 2035 goal.
At this point, no one has any idea how to develop large amounts of offshore wind energy around New York at a price that everyone is willing to pay. And of course no one has a solution to the intermittency problem.
Green hydrogen
New York regulators have recognized that a decarbonized, predominantly wind and solar power generation system requires dispatchable emissions-free resources (DEFR) to function. The best idea anyone has for DEFR is so-called “green” hydrogen, that is, hydrogen produced by a non-emitting system such as wind, solar or hydroelectric power.
Currently only negligible amounts of green hydrogen are produced worldwide, and not at all in New York. But somehow New York got the idea that it could do it. Two green hydrogen plants have received government grants and are reportedly under construction. One is being developed by a company called Plug Power and is located in an industrial park called STAMP west of Rochester; and the other is being developed by Air Products in Massena on the St. Lawrence River. Both plants are comically small compared to the amounts of hydrogen that would be required to fully support New York's electricity generation in a world consisting primarily of wind and solar power. But at least they would be something.
On October 18, the Batavian reported that Plug Power's hydrogen plant was “on pause.” Abstract:
Chris Suozzi, vice president of business and workforce development at the Genesee County Economic Development Center, reportedly told a Washington, D.C.-based commercial real estate firm that Plug Power's STAMP project is on hold. . . . “You’re not ready to go yet,” Suozzi reportedly said. “They’re taking a break. We don’t know what will happen to them at this point.”
Pausing or canceling a green hydrogen project should come as no surprise to anyone. Last year saw significant cancellations of much larger projects of this type by major players such as Fortescue and Origin from Australia. The fact is that the cost of producing green hydrogen is many times the cost of extracting natural gas from the earth with the same energy content. Additionally, natural gas is a much superior fuel in every way (higher energy density, easier to process). handle, less corrosive, less prone to leaks, far less dangerous and explosive, etc.). Meanwhile, STAMP green hydrogen project developer Plug Power reported third-quarter 2024 earnings of a loss of $211 million on revenue of $174 million. In order to continue to exist, they are hoping for a loan from the Federal Ministry of Energy. I wonder what Chris Wright will think about this.
The Air Products plant in Massena plans to use hydropower from a dam on the St. Lawrence River to produce its hydrogen. Forgiveness? Hydropower is already available. How can it make sense to use controllable electricity to produce hydrogen, the purpose of which is to produce controllable electricity? At least about 40% of the energy is lost on the way from electricity to hydrogen and back to electricity. It simply must be that there is a better use of the St. Lawrence River's hydropower than converting it to hydrogen and then using the hydrogen. But nothing here makes any sense.
Transmission line with clean path
Another important facility to bring renewable energy to New York should be the Clean Path transmission line. This is a proposed 175-mile, high-capacity (4 GW) transmission line to transport electricity to New York City and the Downstate region generated by various new “renewable” (wind and solar) facilities will occur in the north and west of the United States. The stated cost of this major project was expected to be $11 billion.
On November 27, the New York State Energy Research and Development Authority notified the Public Service Commission that the Clean Path project had been canceled. Here is a copy of the NYSERDA letter. Here's a December 3 post from Utility Dive about the cancellation.
I can't find any discussion of the reasons for the cancellation, but it must be that the developers figured out that the economics didn't work. Here's the problem: Since wind and solar generators only work about 20-40% of the time, this hugely expensive transmission line wouldn't operate anywhere near its capacity. It would probably only be about a third of the capacity on average. This means that the transmission charges would be about three times higher compared to a line that is almost at 100% capacity.
The deletion of this line only happened last month, and I have seen nothing about any plans to re-offer it or an alternative strategy. So far, no one is saying, “This can't work.” But no matter how you approach the problem, the cost of transmitting intermittent wind and solar power from upstate to New York City will be about three times the cost of transmission of electricity from a natural gas power plant that is in almost constant operation.
So here we are, floating in the air, and no one seems to have any idea that we will soon crash to earth. Everyone involved is trying to squeeze the last few dollars from taxpayers before the crash occurs.
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