Last week I left off with the question of electrical generation and water. Today’s article will discuss how we generate electricity and how we got here. It’s a storied past and not one many of us would have expected. First, how is electricity generated? With the exception of geothermal, wind, hydro, and solar, fuel is used to heat water to generate steam to spin turbines. The result is a burning of that fuel (nuclear, coal, natural gas) creating steam from water, resulting in water consumption.
In the U.S., roughly 60% of the fuel is fossil (mostly natural gas with some remaining coal). Nuclear makes up 19% and the balance is renewables, mostly wind, solar and hydro. The mix varies by country and region. For example, Europe’s mix is 17% natural gas, 12% coal, roughly 22% nuclear, and 45% wind and solar, with some geothermal.
To some extent the mix is driven by available indigenous resources. The U.S. is the leading producer of oil and natural gas in the world. It also is the second largest producer of renewable energy. The U.S. is the second largest emitter of CO2, just behind China that overtook that honor from the U.S. in 2006. China has now embarked on a mandate to wean itself from coal and natural gas to renewables with a 2060 carbon neutral goal.
The U.S. has become the only country to openly politicize climate change. George H.W. Bush strengthened the Clean Air Act and spoke on the threat of climate change, before political pressure caused him to walk away from the 1992 Rio de Janeiro Earth Summit. In many ways that was a turning point but it was in many respects an honest one. Why? Climate change was acknowledged as a real threat but the costs of combating it were honestly debated. Today, some dishonestly label climate change a hoax rather than truthfully debating the costs of meeting the threat.
But politics has little to do with economics. While executive orders and the repeal of E.P.A.’s endangerment finding have real world consequences, they do not have the effect most believe. Industry, corporate governance, and utilities take the longer view where risk and cost replace political theatrics.
Even without subsidies and tax breaks, the costs of renewables are dramatically cheaper. Compare an average cost of $33.00/MWh for onshore wind and $44/MWh for solar to a new combined high efficiency gas generation plant at $77-130/MWh. Coal is dramatically higher. For new nuclear plants, the cost is even higher (and disposal of spent uranium fuel is an unknown cost).
Industry and utilities see the advantages not the politics and combine natural gas with renewables for a lowest cost approach. While renewable battery storage costs are rapidly declining, for now, adding in their cost equalizes the playing field such that we are still in a hybrid environment where natural gas and renewables offer a combined lowest cost alternative.
That’s the fuel side of generating power. But what about the water side? Solar, wind, and geothermal need virtually no water to generate electricity. Nuclear requires between 300 and 800 gallons/MWh (depending on the cooling system used). Natural gas uses an astonishing 2,800 gallons/MWh. For perspective, one MWh can power 30-40 homes for a day (at 2,800 gallons/MWh per day that’s 1.022 million gallons/year for just those 30-40 homes).
These are the factors that weigh on utilities and corporations, not political hyperbole.