The Net Benefits of Low and No-Carbon Electricity Technologies (38 page pdf, Charles R. Frank, Jr., Global Economy and Development Working Paper 73, Brookings Institute, May 2014)
Today we review a research paper that examined the costs and benefits of various non-carbon energy sources, as opposed to oil and gas alternatives, under a number of carbon tax scenarios. Several factors are clear: the benefit of a stable base power or capacity as seen in either natural gas or nuclear outweigh the much lower carbon emissions from solar and wind- to the point that with a $100 per ton carbon tax, nuclear is the favoured option over wind and solar at #4 and #5. If the carbon tax is lower, solar and wind benefits are much much lower than from the other fuel sources. The case for a higher carbon tax is clear if any hope of reducing carbon emissions is to be satisfied.
“It estimates the costs per megawatt per year for wind, solar, hydroelectric, nuclear, and gas combined cycle electricity plants”
“one of the main benefits of renewable energy plants is the energy cost avoided in the displacement of fossil fuel electricity production. Nuclear plants do have an energy cost. However, the energy cost of a nuclear plant is much lower than that of a fossil fuel electricity plant that it displaces.”
“Wind, solar, and hydroelectric plants without storage are inherently less reliable, not because they are mechanically more prone to forced outages, but because the availability of wind, sun or water is highly variable. …a wind plant with a 30 percent capacity factor can actually replace only less than a third of a coal plant with a 90 percent capacity factor“
“Nuclear plants have far and away the highest capacity cost. Gas combined cycle plants have far and away the lowest capacity cost”
“[at $100 per ton carbon tax] A new nuclear plant becomes the most favored alternative. Wind and solar continue to rank fourth and fifth among all the alternatives, mainly because of the very high capacity cost and the very low capacity factors.”
*reductions in carbon emissions are valued at $50 per metric ton and the price of natural gas is $16 per million Btu or less—nuclear, hydro, and natural gas combined cycle have far more net benefits than either wind or solar.
*low and no-carbon energy projects are most effective in avoiding emissions if a price for carbon is levied on fossil fuel energy suppliers. .. The price of carbon should be high enough to make production from gas-fired plants preferable to production from coal-fired plants..
*direct regulation of carbon dioxide emissions of new and existing coal-fired plants… can have some of the same effects as a carbon price in reducing coal plant emissions..a price levied on carbon dioxide emissions is likely to be a less costly way to achieve a reduction in carbon dioxide emissions.
“It is likely to be far less costly to achieve reductions in carbon dioxide emissions through an effective carbon trading system that allows the market to determine the most effective way to reduce emissions rather than through establishment of EPA standards for emissions.”