Proof That Renewables Can Out-Compete Coal

Germany’s second largest energy company (RWE) made a stunning admission yesterday. Well, stunning if you have head your head stuck in the sand when it comes to the rapid evolution going on in the energy world.

RWE announced that “Due to the continuing boom in solar energy, many power stations throughout the sector and across Europe are no longer profitable to operate” and as a result announced that it will take 3.1GW of Fossil Fuel generation capacity offline because ”its no longer competitive.”

In simple terms, without any fuel cost (and against rising coal, gas and environmental costs) renewables are lowering energy prices in the market, a point highlighted by EPEXSPOT (a European power exchange) which today traded peak power at almost 3% LESS than the base load energy price (USD$0.04219 Versus USD$0.4353). The following graph demonstrates the changing trend over the last 12 months in the Austrian and German market.

There is more to complex energy trading markets than this simple story but two things are patently clear and proven by this public statement;

1. Renewable Energy LOWERS energy costs in a wider market context because they have no fuel cost once installed. And in the MAJORITY of cases, consumers (or investors) pay for it with their own money, not the Government and taxpayers. Yes, they get some support through subsidies, (although these have waned dramatically and universally) but so do almost all forms of generation according to the IMF. Anyone who says that Renewable Energy simply increases energy costs is out of touch what what is possible and indeed, what is happening today.
2. This highlights the real reason why owners of non renewable generation, coal assets or associated infrastructure are making such a strong and concerted stance against renewables, and in many cases spreading fear and mistruths. They are trying to prevent the types of losses that are happening to other markets with higher Renewables penetration from spreading here to their business; despite it being dressed up as protection for consumers.

Now lets be 100% clear here; sending any non renewable business broke, or in much of Australia’s case, wrecking State budgets by stripping returns from State owned assets is not “a win” for anyone. I don’t know a single reasonable person in the renewables sector who wants that outcome.

Quite simply, there is a change going on and like so many others, we are simply asking for the bs to stop and for us to all get on with the job of evolution.

The truth of the matter and the alternatives are so blindingly obvious I just wonder what it’s going to take.

The post Here’s (more) proof that renewables can out compete coal appeared first on Solar Business Services.

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Nigel Morris

Nigel Morris has been involved in the PV industry for almost 20 years and is the founder of SolarBusinessServices, one of Australia’s leading PV consultancies. He began his PV career as the manufacturing manager with one of Australia’s pioneers in renewable energy and during his 5 years there, was a system designer, manufacturer, installer, salesman and company director. In 1997 he moved ...

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