Sunday, October 17, 2010

EPA against renewable energy

Does the protection in agency name Environmental Protection Agency mean anything? UDN -- that's right, the pro-KMT paper -- editorializes:
They blamed the government and state-owned Taiwan Power Co., which on behalf of the government acts as the only renewable power buyer, for erecting procedural barriers that make the approval for power purchase impossible.

Taipower and the Environmental Protection Administration (EPA) responded with their own newspaper ads, arguing that both solar and wind energy are unreliable and cannot possibly replace energy generated by traditional thermal or nuclear power plants.

Taipower and EPA also stated that, under the Renewable Energy Development Act, the prices at which the government is allowed to purchase electricity generated by the private sector using solar power or other renewable means were "unreasonably high" -- five times higher than that for electricity supplied by Taipower.

The key point is that nobody in Taiwan has ever espoused that solar energy should replace traditional power generation. Nevertheless, President Ma Ying-jeou has put renewable energy development on a priority list, and the Legislative Yuan lent its support by passing the act.

Secondly, since the rates at which the government purchases solar power or other renewable electricity from the private sector were determined by the Ministry of Economic Affairs, should the ministry be blamed for the "unreasonably high" rates?

In any case, traditional electricity has been available at rates that were far too low -- among the lowest in the world. Who decided these low rates and why has no official had the guts to raise them?
The UDN editorial, which is quite sensible, especially for UDN, raises a couple of key points. One is the EPA's bizarre position on power generation (compare to Beijing reporter Jonathon Watts' presentation in Taipei this week) in which it argues for coal and nukes over renewables. This is consistent with its many other "pro-industry" positions. The other is Taiwan's absurdly low power costs. Various numbers are out there on the net, including these from 2005:
For industrial electricity rate: the average rate in Taiwan is $0.055 USD per kwh, $0.136 USD in Japan, $0.078 USD in United Kingdom, and $0.058 in South Korea. For other developed countries, it is $0.056 USD per kwh in Canada, $0.053 USD in France and $0.052 USD in United States. China still has the lowest electricity rate among these industrial countries with the rate of $0.032 USD per kwh.
Residential electricity rates are 40% higher in Taiwan than industrial rates. This policy is meant to subsidize industry and has been in place since the 1950s. Another comparison in this review of wind power prospects in Taiwan (from the Institute of Nuclear Energy Research) similarly has Taiwan comparatively lower than many countries, but only slightly lower than Korea and a little higher than China.

Low electricity costs have all sorts of nasty effects. They encourage the development of electricity-intensitive industries such as metals processing that are often huge polluters. They discourage the adoption of conservation practices, since electricity is too cheap to conserve. Once the public becomes accustomed to them they hold rising prices against the party that raises them, meaning politicians shy away from price adjustments. Because the public demands low prices, the government chooses coal, whose costs are enormous but whose nominal price is low, as its fuel. The low price is the key factor holding back Taiwan's renewable development:
Analysts say the low price that state-run Taiwan Power Co (Taipower) pays for renewable energy makes it difficult if not impossible to make new wind and solar farms profitable.

"Many parts of Taiwan hold large potential for solar power and other renewable energy," said Wang To-far (王塗發), a former legislator who now teaches economics at National Taipei University. "It's essential that we raise prices to support [this] industry."

A lack of government support means Taiwan's renewable energy sector lags far behind those in other industrialized countries, he said.

Data from Taipower shows that it pays an average of NT$2.38 per kilowatt hour (kWh) for wind-〝generated electricity, far below the NT$3.23 that wind energy operators say they need to break even.

The rate is also below what other countries pay to purchase 〝wind-〝generated electricity. Germany pays an average of NT$4.1 per kWh, Spain NT$3.14 per kWh and Ontario, Canada, NT$4.04 per kWh.
Power prices in Taiwan are set by Taipower, which is under the Ministry of Economic Affairs. The irony of this short-sighted anti-renewables policy is that Taiwan has some of the world's most important solar cell makers and also possesses considerable potential for manufacturing wind energy systems. There is also some geothermal potential though the only plants here closed in 1994. Unfortunately the Developmentalist State mentality, with its preference for big dirty projects that send cash down through patronage networks to local politicians, and its abiding contempt for renewable energy, still grips Taiwan's energy and economic policy.
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21 comments:

mike said...

"Low electricity costs have all sorts of nasty effects."

Which is one reason why the monopoly over electricity production and distribution should be broken up appropriately toward the establishment of a free market in electricity production. Of course that won't happen - because of the mad impulse to socialize economic production as much as possible.

You complain about low electricity costs and the effect they have on the development of renewables, but you must realize that, under the current monopolistic arrangement, raising the price of electricity will effectively result in the poor having to subsidize the rich, solar-panel owning elites. And for how long? What a disgusting injustice.

At any rate, energy investment in a truly free market would surely coalesce around technologies that offer some possibility of network independence with great value for money. Principally these would comprise variations on nuclear power (e.g. radioisotope batteries) and hydrogen fuel cells, with solar, wind and the like attracting only a tiny fraction of that investment. Why? Because solar and wind are so inefficient and therefore expensive as to seldom make any financial sense.

David said...

This post made me think of how different it might have been if Chen Shui-bian had been able to stop the construction of the fourth nuclear power plant. Ithat might forced some changes in energy and industry policy. Instead we got more of the status quo (and the fourth nuclear power plant is still not operational!).

Anonymous said...

On top of this, Taiwan is no longer in a recession and so increasing prices won't be a big shock to industrial users. Double those prices!!!

Michael Turton said...

Ithat might forced some changes in energy and industry policy. Instead we got more of the status quo (and the fourth nuclear power plant is still not operational!).

Yes. The defeat on the 4th nuclear plant was a huge setback for Taiwan. I read on several sites that there is still no island-wide wind energy assessment.

Yes2Green said...

All good points posted above just makes me think and realize...that countries that once were/on the boarder/are still 3rd world power countries are leaps and bounds ahead of us in the race for renewable energy dominance...as American's this could be a huge cash cow/job provider but we may be letting the opportunity pass us by?

David said...

Apologies for the slightly mangled English in my earlier comment. I think everyone can still understand.

Okami said...

The real key thing you miss Mr. Turton is that wind and solar are inefficient, dangerous, and require loads of taxpayer support to be even remotely viable. They're normally subsidy cows milked by the politically connected and an inefficient use of capital.

Windmills are ancient. Now if they were such a great idea to be used as electricity generation, don't you think it would've already been done? Then you have the problem of scale that is the opposite of what the power lines are normally used for. You have to take all that windmill power and run it through a transformer in order to be able to run it to the end user. Then there are the disgusting corruption and rent seeking of the system in place for them. Like the recent Google windmill farm that is actually a play to run power lines from a cheap generating area to a more expensive one. The fact that they are often window dressing for natural gas plants that actually generate electricity reliably, cleanly and cheaply. Then there's the noise and damage they cause to local avian and bat populations.

Then we get to solar electricity, which uses really nasty chemicals to make the panels, then requires large amounts of land and can only generate power during the day when it's sunny. It's been a pipe dream for 3 decades. This one was the mother of all rent seeking scandals as what recently happened in Spain where due to generous subsidies renewable energy took off and solar farms were generating power in the middle of the night using heavy oil generators. Do we really want to implement the policies of a nation that is going to help bankrupt the EU and has 20% unemployment?

Then you get on about cheap power and the dirty and power hungry industries that need it. You know like Iceland who thanks to geothermal industry leads the world in clean cheap energy also using that clean energy to run smelters. Then there's Denmark who supposedly has a clean energy due to windmills but actually has one by importing it from Sweden who generates their power mostly from nuclear and hydroelectric.

Then there is just the "stick the poor" message in artificially raising energy rates. I somehow imagine that if you were poor your attitude would be quite different.

Michael Turton said...

Then there is just the "stick the poor" message in artificially raising energy rates. I somehow imagine that if you were poor your attitude would be quite different.

No, if I were poor I'd still be smart enough not to believe all the nonsense propaganda in that mess you just posted. Coal and oil and nukes are far more subsidized than any renewables, and far more destructive.

mike said...

"Coal and oil and nukes are far more subsidized than any renewables, and far more destructive."

The subsidies for nuclear are not necessitated by energy efficiency problems - unlike solar and wind.

As to whether they are more destructive, not only is the problem of disposing of spent fissile material not nearly as hazardous as you imply, but the distortion of capital allocation by subsidies for solar and wind has its own significant costs - the brunt of which, as Okami has correctly pointed out - will be borne by the poor.

"No, if I were poor I'd still be smart enough..."... to pretentiously call on the government to steal from other poor people because the Church of Green knows best.

Michael Turton said...

to pretentiously call on the government to steal from other poor people because the Church of Green knows best.

Don't be an idiot. Who do you think the costs of coal and natural gas extraction fall on? Do you think the cancer plume in western pa and along the ohio river basin involves mostly the rich? Wake the hell up! Fossil fuels are killing the poor, of course....not to mention destroying the earth.

mike said...

"Fossil fuels are killing the poor, of course....not to mention destroying the earth."

Of course there are externalities, but the fact is fossil fuels have powered a global economy and kept untold numbers of people all around the world alive and warm for nigh on a century.

As for destroying the earth... not even the errors-R-us IPCC is as outrageously incredible as that.

Michael Turton said...

mike, I already know the answer to this question, but have you ever read an actual peer-reviewed scientific paper on climate change?

Anonymous said...

To all the renewable energy haters here, do you have some better ideas?

We WILL run out of fossil fuels, its NOT VIABLE (and in the long run possible) to run on nuclear power only, especially not on a global scale. So whats left? Wait and pray that nuclear fusion will arrive just in time to save us before our grandchildren can go back to life in the caves?

mike said...

"...have you ever read an actual peer-reviewed scientific paper on climate change?"

It's funny you should ask, because although the answer is of course a no (at least nothing more than abstracts, though I do ocassionally read the likes of Climate Progress) I often find that when I ask AGW proponents (like, very recently, David Reid for instance) to cite me the scientific evidence for AGW related claims (such as that sea levels around Taiwan are rising) I come away empty handed...

"To all the renewable energy haters here, do you have some better ideas?" I don't in fact hate renewable energies - I just think that the question of who pays for them, along with fossils and nukes, should be answered by the $ of people who really want to pay for them (i.e. the rest of us should not be forced into paying). I actually think solar and wave may be perfectly viable in certain defined circumstances. As to alternatives, I mentioned hydrogen fuel cells in my first post, although I admit I don't know how likely it is the safe storage problem will be solved in the short to medium term.

I can say something else. The one thing I do really like about solar is the potential it would bring its users, given suitable battery development, for network independence and secondary markets - which I think in the short to medium term ought to be a much more salient goal than developing renewable sources of energy per se.

Michael Turton said...

Thanks Mike. So basically, although you know little or nothing about the science, you're convinced it must be wrong.

I understand.

Robert R. said...

Mike, you mention hydrogen fuel cells, but these are not a power source, but rather better considered as power storage.

Hydrogen, unlike our favorite carbon products, is not readily available and must be produced. The 2 primary ways are stripping Hydrogen from our favorite petroleum product, or by electrolysis (which requires electricity to be produced (probably from our favorite carbon product)).

Fuel cells (in relation to cars) are only "green" in that efficiencies in production & emissions control can be centralized at 1 facility. There is no concern of unburned hydrocarbons that have to be addressed at each an every car. It also makes carbon sequestration possible, although I just consider that to be the atmospheric equivalent of a land-fill.

mike said...

"So basically, although you know little or nothing about the science, you're convinced it must be wrong."

I knew you'd fall into that hole. Actually I know enough science and mathematics to have had my doubts about AGW even if I had been a social democrat like you. To say nothing of last year’s Climategate scandal, in which the coding of surface temperature records was shown to have been done in such a way that the original data is practically irretrievable – hence CRU's denial of FOI requests.

The AGW theory essentially depends upon accurately detecting changes in several extremely complex feedback effects; foremost among which is the carbon cycle itself. The two most difficult challenges for the (sensible proponents of the) theory are mathematical (i.e. accurately seperating single from noise in multiple sets of very complex non-linear data) and engineering (i.e. the practical difficulties in measuring and suitably coding critical data over a long period of time, e.g. calculating amounts of carbon dissolved in seawater around the poles). One of the emails in the Climategate leak (1054756929.txt) contained this revealing remark: “It is also an ugly paper to review because it is rather mathematical, with a lot of Box-Jenkins stuff in it. It won’t be easy to dismiss out of hand as the math appears to be correct theoretically”. That mathematical “stuff” is of critical importance to seperating signal from noise; that it could be referred to in such disparaging tones by a “scientist” is stunning.

Of course there are other reasons to be skeptical, chief among which is the fact that the AGW hypothesis has been hijacked by socialists to call for more internationalized legislation, regulatory powers and taxation of market activity.

Michael Turton said...

To say nothing of last year’s Climategate scandal, in which the coding of surface temperature records was shown to have been done in such a way that the original data is practically irretrievable – hence CRU's denial of FOI requests.

Mike, all of this is bullshit. Moreover, you know perfectly well it is bullshit. I have zero respect for people who argue in bad faith for wholly anti-science positions.

Stay off my blog. I don't have time to waste on flat-earthers, creationists, and agw denialists.

mike said...

"Mike, all of this is bullshit. Moreover, you know perfectly well it is bullshit. I have zero respect for people who argue in bad faith for wholly anti-science positions."

No it isn't - and no I am not arguing in bad faith. You're the one dismissing my (verifiable) assertions without any reference to falsifying evidence.

"Stay off my blog. I don't have time to waste on flat-earthers, creationists, and agw denialists."

Fine, I'll make my comments elsewhere - but you're the religious party in this, not me; I have never denied that some form of global warming could be possible, but I don't think the evidence is at all convincing.

Stefan said...

32 national academies of science have released a statement that they support AGW, there is not a single reputable organization of scientists anywhere in the world, which has released an opposing statement.

http://en.wikipedia.org/wiki/Scientific_opinion_on_climate_change#Academies_of_Science

Lucky we have met the one person who can see through all the bullshit: Mike, a guy who "knows about science and mathematics". Good he came along, otherwise we'd have blindly put our faith in the hands of qualified scientists who have the respect of their peers.

Anonymous said...

Has anyone else noticed EPA volunteers throwing their weight around on beaches etc.? Interested to know if they actually have police powers to move people along and so forth.