Danish fairy tales – what can we learn?

“It’s estimated that if we fully pursue our potential for wind energy on land and offshore, wind can generate as much as 20 percent of our electricity by 2030 and create a quarter-million jobs in the process — 250,000 jobs in the process, jobs that pay well and provide good benefits. It’s a win-win: It’s good for the environment; it’s great for the economy. Today America produces less than 3 percent of our electricity through renewable sources like wind and solar—less than 3 percent. Now, in comparison, Denmark produces almost 20 percent of their electricity through wind power.”

Barack Obama, Earth Day Speech, April 22, 2009

” ‘But the Emperor has nothing on at all!’ said a little child.”

From The Emperor’s New Clothes, by Denmark’s famous poet and author, Hans Christian Andersen, 1837

Guest Post by Tom Blees. Tom is author of Prescription for the Planet – The Painless Remedy for Our Energy & Environmental Crises. Tom is also the president of the Science Council for Global Initiatives.

————–

Last month Denmark’s CEPOS, their Center for Political Studies, published a report called Wind Energy, The Case of Denmark, from which that Obama quote was lifted. It sheds a harsh light on the young president’s wind vision, and reveals a dubious statistic and assumptions that may be far from the future reality of the USA despite the promising rhetoric.

Brave New Climate is one of those rare sites that eschews the hype about energy systems, where the contributors and most commenters seem to want the straight facts based on actual data. Fortunately we have a couple decades of data on wind and solar power systems, and of course considerably more decades than that on nuclear, though changes in regulatory and subsidy frameworks have often had as marked an effect on energy systems as technological advances.

Last week I wrote a post on Germany’s economic experience with solar power, and in the comments I included more links to similar articles describing Spain’s own dubious foray into a solar-powered future. Today, with Barry’s indulgence, I’d like to turn the spotlight to Denmark’s experience with wind power, a national experiment that began in the mid-Eighties and is continuing to this day. Denmark was the leader in the development and deployment of wind turbines up until very recently, and still plans to keep moving in that direction with the construction of 800 MW of new offshore wind turbines by 2013. One reason they’re going offshore, despite the added cost, is because after almost 25 years of building windmills all over the country they’re starting to get a NIMBY reaction to building more of them on land.

While President Obama’s statement that “Denmark produces almost 20 percent of their electricity through wind power” might be technically construed as true, it belies the real picture, a situation that bedevils the notoriously fickle wind power wherever it has been built. If one simply looks at the statistics of the number of megawatt-hours of electricity produced by wind power in Denmark over the course of a year and divides it by Denmark’s electricity demand, the number does indeed come out to nearly 20%. But the devil is in the details.

Denmark’s thermal power plants, fueled mostly by coal, produce not only electricity but also heat for the towns near which they’re located. The Danes have taken great pains to make their coal plants as efficient as possible by building them for such double duty. But what happens when it’s wintertime and the wind is howling, spinning those turbines like crazy? One can easily imagine that those same days are mighty chilly, and so those coal plants are fired up even though the electricity they’re producing is now in less demand than the heat they’re producing to keep the Danes warm.

This situation presents a dilemma, for the high simultaneous production from both the wind and the coal plants means that Denmark now has an electricity glut. Despite the contention of many wind and solar advocates that energy storage is practical and economical, a couple decades of experience with wind turbines apparently still hasn’t been enough for the Danes to get the message. So when the glut has driven the price down, frequently to the level of zero, Denmark ends up exporting their wind-generated electricity to their neighbors, chiefly Germany, Norway, and Sweden.

The latter two nations have acted for years as Denmark’s energy balancers, allowing the Danes to utilize the erratic power of wind and still keep their grid balanced because Norwegian and Swedish hydropower stations are able to load follow the Danish grid. When electicity is pouring over the interconnector from Denmark, its partner/neighbors can refrain from letting so much water through their turbines, so in a way their reservoirs can be seen as Danish storage batteries. But later on, when the wind isn’t howling, Denmark either has to generate their electricity with coal or else buy it from their neighbors at substantially high prices. But what’s worse than buying high and selling at zero?

“In October 2009, Nordpool, the electricity trading system used in the whole Nordic area, is introducing a negative price for power. The floor price that traders will have to observe, presently zero, will be extended downwards to minus €200 per MWh. This will apply in particular to Denmark and more particularly, because of its high wind capacity, the West Denmark price area. In effect, “the market” will be penalizing other generators for excess wind power in the market.”

So while Barack Obama’s 20% number is nearly true in some sense, the reality is that wind has been supplying less than 10% of Denmark’s electricity on average over the last five years, and as little as 5% in the poor years. This despite a crippling level of subsidies that saddle Danish citizens with the highest electricity rates in the EU.

The CEPOS report also examines the creation of “green jobs,” the other carrot held out by the president. Even allowing generous assumptions in their calculations, the report’s authors conclude that each such job actually created consumes subsidies of $90,000-140,000 USD, about 175-250% of the average pay per worker in the Danish manufacturing sector. What’s worse is that the wind turbine industry is over 10% less productive than other industrial sectors. The report concludes:

“The Danish experience also suggests that a strong US wind expansion would not benefit the overall economy. It would entail substantial costs to the consumer and industry, and only to a lesser degree benefit a small part of the economy, namely wind turbine owners, wind shareholders and those employed in the sector.”

With the tenuous economics of their situation already clear, things are about to get worse on a couple of fronts. Norway is building connecting links to both the Netherlands and Germany in order to play the balancing game with those countries as they build up their wind farms. What this will do is make Norway’s valued balancing capacity more valuable, driving the cost of their electricity even higher since now there will be competition for that balancing capacity from three countries instead of having Norway as Denmark’s captive audience.

Looking at their nation’s experience so far and the forbidding situation with their erstwhile balancing buddy Norway, what do you suppose the Danish politicians are recommending for the wind industry? Amazingly, the Danish Parliament decided last year that by 2025, 50% of Denmark’s electricity demand must come from renewable resources, mostly wind power. This level of blindness to the data is certainly on a par with Germany’s continuing foray into solar subsidies that we examined last week. Perhaps they should read this report, which lays out the situation for all to see:

“The very fact that the wind power system, that has been imposed so expensively upon the consumers, can not and does not achieve the simple objectives for which it was built, should be warning the energy establishment, at all levels, of the considerable gap between aspiration and reality.”

It seems the politicians, despite the hard and rather unforgiving data, still believe that pursuing the dream of running Denmark on wind is a political winner. But should such decisions be based on political expediency rather than economic and social realities just because the populace has been convinced by years of conditioning that windmills are a good thing?

Now it’s only fair to point out that Denmark is a rather unique case, and that wind power generated in a much larger country can more easily be routed within that country rather than being subject to the tender mercies of neighbors who might be looking out primarily for their own bottom line. On the other hand, electricity markets within large countries and even large states can be every bit as unforgiving as the Norwegians might prove to be, as witnessed in California’s recent history. What cannot be argued is that wind power presents serious obstacles to balancing the grid, which in the absence of creative ideas to fix that situation will cause wind power to continue to be a thorn in the sides of power managers and will limit wind’s penetration into the electrical market, even if the money and the will are there to pursue a massive buildup.

There are certainly ways to ease that problem. How about if we had electrolysis systems incorporated into all the wind farms that could suck up power spikes and smooth out the output to the grid? We could use the hydrogen to make ammonia, either for fertilizer or fuel, reducing the amount of natural gas that is used for that purpose. The problem? I suspect (though I haven’t crunched the numbers) that this would be a very expensive way to produce ammonia compared to the way we do it nowadays, even if we impose a carbon tax on natural gas. But I’m sure there are some other ideas. The question is, do the economics of wind make sense compared to modern nuclear power systems? Where should we be putting our energy dollars and efforts?

I recently had a tour of a nuclear power plant owned by one of the big private utility companies. One of the plant operators was candid in expressing his frustration with the company’s attitude. The nuclear plant was producing the lion’s share of the electricity, yet they were treated like the red-headed stepchild. All the attention was focused on windmills and solar panels that weren’t producing enough to make a blip on the energy radar. They make for such good PR!

So what path is President Obama going to encourage? I know for a fact that his two top science advisors are very knowledgeable about IFR technology. Surely the realities of wind and solar development in other countries that have preceded us in these areas can’t be unknown to them. But so far nary a peep has been heard from the White House about IFRs, and precious little about nuclear power in general. Will we soon see the discussion emerge from behind the scenes? Will Obama take the political risk and lead his country away from fantasy and into a viable energy future?