Ya' gotta love the California people, don't you? Talking to a friend who's still fully engaged in the electrical power business, and he shared that because of the renewable energy mandates in California they are signing 20+ year power purchase agreements (PPA's) for solar power plants, which because of the land area for heliostats (aimable mirrors) and complexity of the process approach the cost of a nuke plant, in the range of $5500/kw!! And they only work when the sun shines!! No base load capability, no long term reliability, and severely reduced output on a cloudy day!! Think about that - the average working homeowners electrical load is high for a couple of hours in the morning, getting ready for work, low during the day while they're at work, and then peaks when everyone comes home, cranks up the AC or heat, cooks dinner, throws in a load of laundry or two, turns on one or more TV's/computers/stereo's, and then plops down for a few hours before bed well after dark. Where's the power going to come from after dark?? :confused:
Now recall that not too many years ago California was the place that passed legislation to regulate the power industry, setting limits on the amount utilities could charge their consumers for power, which then established a thriving independent power producer (IPP) network, generating power to sell on the spot market, and staying alive with short term PPA's for a part of their capacity, holding reserves for spot sales. Everyone thought this was a great idea - let the independent businessmen spend their capital building fast reacting gas turbine plants, and the utilities did not have to invest but could reap the benefit of readily available power!! Of course the utilities failed to sign long term PPA's for their needed power, and when they had to bring a big unit down for maintenance, or worse yet when a big unit (or units) tripped off-line due to some catastrophic equipment failure they had to turn to the spot market for large amounts of power. The utilities were then amazed that the spot market price spiked - pure supply & demand!! Those nasty IPP's were taking advantage of the utilities who failed to plan!! The result was the prompt de-regulation of the power industry (1998), removing the price controls from the utilities, but also putting controls on the IPP market, making them support the grid at the "going rate" whenever they were capable of generating power - they have to prove that they have a problem anytime they're off-line, even if it's not a money maker for them to run because of fuel costs.
So now they mandate (Executive Order S-14-08, November 2008) that by 2020 all utilities must generate 33% of their power from renewables. The plants are being built, the costs are ratcheting up, but the consumer hasn't seen it yet because the rates change only after the money has been spent, and all the utilities have to do is document their cost per KW and it passes through to the consumers. Get ready. It's coming. There's going to be wailing and gnashing of teeth coming from the left coast in a year or two when the first rate bumps come, and it will get worse and worse as they approach 2020.
But I can hear it now - "This is not FAIR!! WE are the ones 'saving the country' from greenhouse gasses, and we're being PENALIZED for it!! Uncle Sugar should subsidize each consumer in this region to pay the differential cost for each KW we use!!" :rolleyes::confused::eek::mad:
