If energy was 10 times cheaper than currently and still available (no shortage) then we would automate more tasks and increase the global productivity. We could mine more, build more, to train/run more LLMs.
GDP is tied to energy price and availability. It is likely the main reason why US enjoyed a growing economy thanks to its free oil reserves (and the reason why Texas alone is the 8th economy in the world). Now one could argue that after pumping oil for a century now, it might not be as cheap or plentiful to extract in the future, and we better be prepared for it.
It is all about energy. No energy, and we will reduce to human/manual or animal (bring back the horses!) labor. Productivity will decrease significantly.
One issue I have with the paper, is that it equates energy and electricity. My favorite chart about US energy: https://flowcharts.llnl.gov/sites/flowcharts/files/2023-10/U...
shows that in 2022, electricity was just 13.3 Quads of the 76.07 Quads of the energy consumed in US by residential, commercial, industrial and transportation. So unless US "electrify" the whole economy having more electricity would only help a small part of the economy.
Sure.
> To increase productivity, we need more machines,
That is just one way to increase productivity. You can also make more efficient machines, come up with more efficient production processes, find alternatives to existing products that are more useful for a given task per quantity, and similar kinds of concepts. This is the point GP was making (there are more ways production changes than increasing energy used), not that energy is completely unrelated to production as a whole.
There is a reason that the Kardashev scale is about energy utilization.
The reason why now we most enjoy some time off (weekend, vacation, retirement) is thank to the machines that can produce more with less humans. Now humans mostly drive the machines.
I guess the ultimate extreme evolution would be machine driving machines, so humans could be out of the loop, except for the initial input goal. And machine would extract/mine/recycle, transform, transport, deliver everything we ever need. It would be one big machine (with lots of energy) extracting (and hopefully recycling) earth elements to satisfy humans.
See also that machine in fiction, breaking down: E.M. Forster's "The Machine Stops" from 1909, available free at Project Gutenberg https://www.gutenberg.org/cache/epub/72890/pg72890-images.ht...
A graph of major economies percentage of electricity in final energy:
https://preview.redd.it/china-is-electrifying-far-faster-tha...
Electric "transformers" (aka machines) are more efficient in general than their fossil fuel counterparts (less heat).
Electrification (with matching electricity production) is a matter of national security. If/when fossil fuel would become either more scarce or more expensive (or both), all hell will break loose. There would be conflicts and chaos.
China is planning for long term, and putting resources in to it.
Unfortunately, the US democracy is not suitable for long term planning (while politicians can have very long terms, they are always busy planning for their re-election, not planning long term for the country). Who would have the fortitude to plan for a 10, 20, 50 years time horizon ?
US should plan for electrification (production + grid) and give a strong signal to the industry so the industry can plan ahead (e.g. GE,etc. can prepare production from gas stove to electric stoves, car manufacturers and dealers to electric vehicles, logistic companies to be ready to use electric trucks and trains, etc.), and no flip-flopping signals like we get now. The industry needs to feel confident that their investments would hold decades from now.
All this would takes years, and cost a lot. And the benefits would only be visible decades from now (no incentive for politicians). But at the time, any nation still dependent on fossil fuel, would be crushed.
Many physical things take pretty fixed amounts of energy. Eg heating a liter of water.
It's overseas owners are constantly playing hardball with the country over the price they pay. Feels like every year they threaten to shut the smelter down unless they get better electricity rates.
[0] https://en.m.wikipedia.org/wiki/Tiwai_Point_Aluminium_Smelte...
I think you're right, but also that the majority of the problems with the worlds economies (in the richer nations) are because of similar generalizations, and as such I think it important to rebuke them.
Having more cheap energy available is good (all else being equal), but optimising for higher energy usage is absurd.
Are any AI companies making money now? Losses can’t go on forever.
for other economic activities, such as solar panel production, aluminum production, and neural network training, energy is a limiting input. reducing the cost of energy will result in more gdp in those sectors
> aluminum production
Dropping energy costs an by 75% only drops smelting prices by about 30% and finished goods by even less.
to take one example, the last time we got access to a major new source of energy was something like watt's steam-engine in 01776. one of the effects of this was the widespread replacement of steel cans (which hadn't been invented in 01776) and glass bottles with aluminum cans in the 01970s, 200 years later. another was the replacement of travel by ship with travel by air, also about 200 years later. the delay is because many intermediating innovations were required, for example, in the aluminum-can case:
- the discovery of electrolysis;
- the discovery of aluminum;
- the discovery of canning;
- the hall–héroult process;
- improved aluminum alloys that permitted the use of 100μm-thick cans;
- the invention of deep drawing;
- epoxy liners that made aluminum cans chemically stable to acidic contents such as coca-cola;
- long-distance trucking which increased the cost imposed by heavier glass bottles.
$2,500/kW of capacity isn't too expensive, given the alternatives.
https://www.latitudemedia.com/news/catalyst-the-cost-of-nucl...
The recent batch of 11 reactors authorised by China are perhaps 2.8B USD each for 1.1GW plant (plus a high temperature gas reactor).
that large grid also needs regulation, billing, and political stability. (a reactor is an appealing target for both russian glide bombs and enron-style scams.) and the reactor is not dispatchable over timescales of less than a day, while you can short out a solar panel in microseconds
fundamentally the reactor can't compete economically because it's shackled to a pricey steam engine. the reactor itself is a triviality, just a pile of fuel larger than the critical mass. some of them formed naturally at oklo billions of years ago. what's hard is integrating that energy release mechanism into a machine, and that's because the humans are still terrible at making machines
https://www.fwi.co.uk/business/alternative-land-uses-leasing...
as an example, a 100-megawatt electric arc furnace might occupy 1000 square meters, and it's amenable to solar's intermittent energy supply in a way that blast furnaces aren't, but even at the ideal kilowatt per square meter, it needs 100 000 square meters of solar panels to power it, about ten city blocks. more plausibly it needs several times that. you can't physically fit those panels closer than hundreds of meters from the arc furnace, and land costs mean you probably have to put them out in the countryside, likely tens of kilometers away
A solar farm is more than just solar panels. This 3.5GW solar farm cost 2.13B USD, so by your estimates the panels make up just 1/5 of the cost of the farm. I'd expect the load factor of the nuclear power station to offset the solar farm's nameplate capacity advantage, and lead to steadier prices/fewer storage requirements etc etc.
https://www.pv-magazine.com/2024/06/06/worlds-largest-solar-...
> and it needs to be installed far from the point of use
Note that this is a problem for solar farms in China; they are installed where land is not valuable. Hence all the HVDC transmission records being broken in China. Plus nuclear power stations can be close to populations. For instance https://en.wikipedia.org/wiki/Daya_Bay_Nuclear_Power_Plant is 50km from Hong Kong.
> the reactor is not dispatchable over timescales of less than a day
Modern reactors have load following capabilities, e.g. the AP1000 can ramp up 5% a minute within the 15%-100% band.
So capital costs vs capital costs on a per Wh basis isn’t in favor of Solar it favors nuclear which has less flexibility. IE: 24 GWh per day of battery backed solar can dump half that power over 2 hours @ 6GW. 24GWh of nuclear IE a 1GWh reactor caps out at 1GW. If you want to ramp to 6GW of output nuclear needs several nuclear reactors and all of their associated costs.
> Modern reactors have load following capabilities
Load following isn’t free for nuclear, any time you’re not operating at 100% you’re losing money. Batteries are inherently way more flexible.
It also costs more to build a load following reactor and they have more experience maintenance issue due to thermal stress. Nuclear inherently favors steady state operations due to the Xe pit (https://en.wikipedia.org/wiki/Iodine_pit) but it also requires being taken offline for long periods for maintaining, refurbishing, and or refueling.
https://www.iea.org/reports/projected-costs-of-generating-el... page 59 table 3.13a puts O&M for nuclear in the USA at about 12 USD/MWh plus just over 9 USD/MWh for fuel, and table 3.14 puts O&M for utility scale solar at around 6 USD/MWh or so.
As for batteries, I think a few hundred USD/kWh is a reasonable guesstimate of cost (raw LiFePO4 cells are now sub-100 USD/kWh). Backing up each hour of production of a 1GW power station would cost a few hundred million USD, plus the cost of the solar farm to charge the battery up.
> 24 GWh per day of battery backed solar can dump half that power over 2 hours @ 6GW
At which point the transmission becomes the limitation; the grid operator probably wants a fairly stable flow of electricity through the wires to maximise utilisation so the 6GW is not realistic, nor would moving the electricity during the day to load-adjacent storage be efficient.
> Load following isn’t free for nuclear, any time you’re not operating at 100% you’re losing money.
I was responding to the point that solar panels are inherently more flexible because you can turn them off (because ...????). The same reasoning you've made about nuclear load following being uneconomical can be made about pure solar too.
> Nuclear inherently favors steady state operations due to the Xe pit
Operators change the boron concentration to offset the negative change in reactivity due to Xe-135 levels. For PWRs this is not a big problem, you just have to know it is there and do the calculation for I/Xe concentrations given the power levels.
Ex: Your quoted fuel costs would be 0.9c/kWh in (2020 publish date) = 1.3c/kWh in 2024. O&M is often quoted as 4x fuel costs so 5.2kWh. “Fuel costs account for about 28% of a nuclear plant's operating expenses.” https://en.wikipedia.org/wiki/Economics_of_nuclear_power_pla...
A battery system which costs 200$/kWh and does 5,000 cycles = 5c/kWh. (Not every kWh from a solar farm needs to be stored, but this is just a ballpark comparison.)
> At which point the transmission becomes the limitation; the grid operator probably wants a fairly stable flow of electricity through the wires to maximise utilisation
You’re missing the forest for the trees here. Utilization follows demand, a state with peak demand of 6GW is going to have transmission lines setup for 6GW. But comparing the options you have nuclear with 4x 1.5GW reactors averaging ~40% utilization or batteries backed by solar. Run the numbers and Solar wins by a landslide.
Page 41 states
All costs are reported here in 2018 USD terms.
Insurance is required for any industrial facility. The IEA report does not mention insurance. https://world-nuclear.org/information-library/safety-and-sec... puts insurance costs at around 1M USD/year (and separate conditional payments if an accident does happen), which divided by 9M MWh/reactor does not work out to much.
> setting money aside for decommissioning
For nuclear between 0.01 and 0.39 USD/MWh, and solar between 0.03 and 0.58 USD/MWh (depending on discounting).
> O&M is often quoted as 4x fuel costs
The data in the IEA report differs; it is somewhere between the fuel costs and twice the fuel costs.
> Not every kWh from a solar farm needs to be stored
Rooftop solar will cannibalise the utility solar's daytime market. The demand for utility solar's energy will for the most part occur when the sun does not shine.
> a state with peak demand of 6GW is going to have transmission lines setup for 6GW.
But this ignores the physicality of the grid; power stations are dispatched based on location as well as availability because transmission is expensive to build and limited in capacity.
> you have nuclear with 4x 1.5GW reactors averaging ~40% utilization
So your demand model is 2GW for 22 hours and 6GW for 2 hours, right? Are there many places which exhibit such wild swings? Dynamic pricing/load shifting, pumped hydro and OCGTs would be the traditional solutions.
So even further out of date.
> O&M is often quoted as 4x fuel costs The data in the IEA report differs; it is somewhere between the fuel costs and twice the fuel costs.
Operations & Maintenance must include fuel costs… They are doing the thing where they break actual costs into several buckets to make actual operational costs seem lower. Refurbishment isn’t maintenance yadda yadda.
Same deal is going on with insurance. That 1.1 M / year covers some nuclear accidents, but the self insurance risk is quite significant even if you exclude the risk subsidy assumed by governments. IE: In the event of a large scale disaster insurance doesn’t make the reactor owner whole meaning their out the value of 1 or more nuclear reactors.
So yea 1.1M / year only works out to 0.01c/kWh but that’s an underestimate.
> Rooftop solar will cannibalise the utility solar's daytime market. The demand for utility solar's energy will for the most part occur when the sun does not shine.
Even assuming vastly more rooftop solar… PV panels produce power on a long tail curve not just at peak hours. Rooftop solar however only supplies the grid with power after the houses needs are met which is a significantly narrower area.
Do you have references for how much a solar plant costs to build and maintain? A breakdown of costs would be good.
> Operations & Maintenance must include fuel costs…
I presume this was done to make section 5.4 "Fuel cost sensitivity" easy.
> Rooftop solar however only supplies the grid with power after the houses needs are met which is a significantly narrower area.
What about if people are over-specifying their solar PV system to make use of net-energy-metering (or high feed in tariffs) to reduce their annual bill (for instance in California)?
Don’t just think about what happens when these systems are at 100% output. At 5% output that home is sucking power from the grid while the solar far is providing the grid with power. Which means even if every home and business adds panels a solar farm will still supply some electricity directly.
there are particularly perverse grid incentives in some places which result in pv farms continuing to operate when grid prices go negative, too, but that's just a fake market; nothing about the generation technology requires that. if you close a contactor to short out your solar panel, it stops dumping any energy into the grid in nanoseconds, literally faster than the contact bounce in your contactor, without any damage or risk to the panel, power electronics, or the rest of the plant
with respect to transmission and battery storage, while there is some reason to locate pv farms some distance from the energy consumers—the consumers may be tightly packed and/or in a cloudy area—there is no reason to locate battery storage far away from energy consumers. you want batteries to be as spread-out as possible, as close to the load as possible, for many reasons: to avoid time-of-day congestion of transmission capacity (and even distribution! point-of-use batteries reduce or eliminate the need to overprovision distribution capacity); to prevent fires from spreading from one battery to another; to eliminate power outages caused by problems in transmission and distribution; to eliminate transmission and distribution energy losses for stored energy; and to reduce the opportunities for rent-seeking by transmission and distribution operators. the land use, climate, and safety considerations that sometimes limit the distribution of pv spreading-out don't apply to spreading battery storage out
as for the o&m costs: while the iea does wonderful work, and i appreciate you pointing to this very informative open-access report, this report is from december 02020, and it's largely built on data from previous years, much of it from plants built years earlier. the main topic of the tomas pueyo article we're commenting on here is how lower prices for solar panels are forcing people to design new solar power generation in ways that 'waste' solar panels in order to commensurately reduce the other associated costs, such as the operation & maintenance costs you refer to in table 3.14
with that in mind, looking at https://www.solarserver.de/photovoltaik-preis-pv-modul-preis..., pvxchange's current mainstream panel price index is €0,12 per peak watt, and in september 02017 (probably about the average time the plants profiled in the iea report were being built, and as far back as the data currently on that page goes, though archive.org has older versions) it was €0,42 per peak watt. that is to say, solar pv modules cost 250% more at the time. those solar farms were designed for a very different world than the one we live in today, one that could tolerate much higher o&m costs in order to make better use of the comparatively scarcer solar panels
especially if it's cheaper to put up more solar panels somewhere more overcast than to build hvdc transmission lines from urumqi to shanghai
it turns out that, if you use solar panels the same way you'd use nuclear reactors, by centralizing them hundreds or thousands of kilometers away from where the energy is used (as in this case), or by concreting over prime beachfront property (which nuclear power plants need) to build giant solar farms on, they can cost almost as much as nuclear reactors do, or even more
this is analogous to how factories first used electric motors: they installed a giant electric motor in the factory's powerhouse to drive the line shafts, replacing the steam-engine the powerhouse was built for. consequently electrification famously didn't increase factory productivity for decades
when i said that nuclear power plants 'need to be installed far from the point of use', i didn't mean that they couldn't be tens of kilometers, or even single-digit kilometers, from the point of use. i meant that they can't be single-digit meters from the point of use. solar panels can, and that dramatically drops costs
i appreciate the correction about the ap1000! naval nuclear reactors have been able to rapidly ramp up and down since forever, so it's good to see that capability making it into commercial nuclear power
Transmission costs, yes. Plus if the solar is behind-the-meter you might avoid some of the taxes and levies applied to grid electricity.
(Note that I realise the focus of my comment from here on down has changed from China to the UK, but then again I've not helped install a solar installation over there!)
However with UK rooftop solar home-owners do not have much negotiating power as the market supply is restricted by the MCS scheme (Microgeneration Certification Scheme). This may be changing in the future (Flexi-Orb scheme), but until a greater pool of competent installers are in the market the prices will not decrease.
A relative had 6.4kW solar (and 5kW hybrid inverter) installed last summer for around £7,000. I added in some batteries for another few thousand. The panels generated around 5,100 kWh last year, for a capacity factor of around 9%.
Why? They are correlated and so are reasonable metric to gauge progress when starting from a subsistence economy (as all economies in the world began). At some point, this may be less true when you hit a energy generation ceiling and you start 'optimizing' and trying to do more with the same amount .. but again, we're not there yet so it's a good metric today, and especially for developing economies.
Put another way, you show me GDP per capita or per capita Energy use and I can get a reasonable ballpark for the other as well as a measure for the wealth of that nation.
It will show up as decrease in exports because other countries (or societies or tribes or whatever you want to call them) will want less of what your country is selling.
Which then shows up as decreasing purchasing power for things that you do want from other countries (i.e. you getting poorer).
Luckily for the US, that does not seem to be the case given the resilience of the purchasing power of the USD.
The author asserts that we should see 5x GDP/c if we had 5x power usage per person and their own graph shows that that's not the case because it's a flawed assumption that ignores increases in efficiency and transitions away from energy intensive manufacturing to service based.
The best evidence for that is that the GDP/c didn't fall off when we fell off the HA curve. In fact I took the GDP per capita and Energy consumption per capita data from world data bank and the ratio between the per capita GDP vs the per capita energy consumption has been going up steadily since we stopped following the HA curve.
Between 1960 and 1970 the ratio between GDP and Energy Consumption per capita was essentially static at .74 then after 1970 the ratio begins to increase showing we're producing more per unit of consumed energy at a nearly linear rate. By 2014 which is the last year they had the Electric power per capita data the ratio was all the way up to 4.2. Eyeballing it the relationship is almost perfectly linear each year we get a little better at producing GDP for each kWh we consume.
I even redid the calculation based on raw energy use in kg oil equivalents and it gets even more drastic. 1960 to 1970 it goes from .53 to .69 GDP/kg oil equivalent [0]. Then after 1970 the rate increases quite distinctly going from .69 to 1.58 in 1980, 3.11 in 1990, 4.5 in 2000, and 6.79 in 2010.
It's pretty clear from the data that we're getting better at producing things with the same amount of energy. It's an assumption that simply making more power would increase the amount of things made.
Electricity use per capita: https://data.worldbank.org/indicator/EG.USE.ELEC.KH.PC?locat...
Energy use per capita in Kg oil equivalents: https://data.worldbank.org/indicator/EG.USE.PCAP.KG.OE?locat...
GDP per capita in current USD: https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?location...
[0] nice.
YUP. Of course there is a strong correlation between energy use and GDP growth; it takes more energy to produce more stuff.
But ultimately, what produces more stuff is harder to measure. To light the factories, more energy used to correlate with more light, until we swap out the incandescent/halogen lighting sources for LEDs. Then, we get more light for something like 16% of the energy usage. Or, getting to the stage of "lights-out" automation, and the same production for zero lighting energy. Same for more efficient motors, swapping ovens for inductive heating, more efficient processes, etc.
Seems that measuring GPD growth by energy consumption is like Bill Gates' famous example of saying that "measuring software progress by lines of code is like measuring progress in aircraft by the weight of the planes". Obviously, in specific cases, all things being equal, more is more, but in reality, fewer LOC and lighter airplanes generally produce more results.
Energy consumption is also about using that stuff. And in rich countries like the USA, a lot of energy goes to using things or just moving people. So it's possible to build more and use less energy, even if you don't reduce the energy cost of building things. They can simply become more efficient to use and move.
In USA, 30% is just homes and commercial sector. 40% is transportation. 30% is "industry". By a sort-of inverse-amdahl's law, it's possible to get lower energy use with more throughput even if we don't make "industry" more efficient.
In principle I can imagine that being true - but that's not represented in our world, so it is an open question if you can 'build more and use less energy' in the real world.
USA GDP is still on basically the same exponential curve, yet energy is flat. That's the counter example. The rest is exposition.
It's basically a piece wise function if you graph it. 1960 to 1970 the GPD/energy unit ratio is largely stable then after that it begins increasing monotonically going from .69 to 7.94.
There are losses in practice, of course, to friction, air resistance, etc. but the laws of physics don't impose any lower bound on these.
> Yet the amount of electricity we consume for light globally is roughly the same today as it was in 2010. That’s partly because of population and economic growth in the developing world. But another big reason is there on the Las Vegas Strip: Instead of merely replacing our existing bulbs with LED alternatives, we have come up with ever more extravagant uses for these ever-cheaper lights
NYT: The Paradox Holding Back the Clean Energy Revolution
this is nonsense. lighting hasn't been a significant fraction of the energy usage of factories since they switched from being lighted by fireplaces to gaslighting. not in 02024, not in 01974, not in 01924, not in 01874
> Seems that measuring [gdp] growth by energy consumption is like Bill Gates' famous example
it's true that higher efficiency is better, of course, but your comment embeds the false assumption that higher energy efficiency reduces energy use. in fact, higher energy efficiency usually increases energy use, because it increases the scope of things to which marketed energy can be economically applied more than it reduces the use of marketed energy for things it was already being used for. (this is the well-known jevons paradox mentioned in https://news.ycombinator.com/item?id=41392248). so, even today, it turns out that the countries with the lowest gdp and lowest energy use also have the lowest energy efficiency
similarly, using high-level languages reduces the number of lines of code to implement some given functionality; but you would be completely mistaken if you used that fact to predict that the vast majority of programmers spend their time writing assembly language instead of python because python requires one twentieth of the code to do whatever. many things are done with python not just because companies writing python outcompete companies writing assembly, but also because programs that would be unprofitable to write in assembly language become profitable to write when you can write them in high-level languages!
Right, but it is an easy example to explain at the outset and why in the literal next sentence I mentioned: "Same for more efficient motors, swapping ovens for inductive heating, more efficient processes, etc."
>> embeds the false assumption that higher energy efficiency reduces energy use
NO. I am describing a COMPLETELY different effect. I am not talking about marketing anything, but the results of improved process efficiencies.
If Company X, or an entire industry, switch from large inefficient ovens to spot-heating, and still produce the same number of widgets for 10% of the energy, the energy used has entirely decoupled from economic output. Same GDP, lower energy consumption. Or, if the new widgets are cheaper and more get sold, then greater GDP and smaller energy consumption number.
The point is, regardless of all the knock-on and sometimes paradoxical effects, the previously strong 1:1 correlation of energy use to GDP starts to break when efficiency-enabling technologies gain widespread adoption.
There are also paradoxical questions such as what happens when Company X switches entirely from oil heat and electricity to on-site solar & batteries, producing the same number of widgets using the same total energy? The GDP seems to go down because oil is no longer being pumped, transported, refined, and transported again to Company X's factories, but the output is the same, so the same net goods flow into the economy. The entire enterprise of getting refined oil to Company X is now shown to be redundant to production. But also, the energy usage as measured at the grid went to zero.
Again, the point is, the not only is the relationship of energy-GDP unstable, the entire measurement of GDP is problematic.
Oh the irony.
https://wimflyc.blogspot.com/2021/01/the-henry-adams-curve-c...
Henry Adams points out that over 60 years you got 3-4x more power from a ton of coal. That combined with the extra coal dug up, he claims, doubled usable energy every ten years.
But then the modern graph simply shows the coal energy, with (as far as I can tell) no attempt to account for the extra efficiency, even though the modern author of the graph makes explicit reference to the increasing efficiency of steam engines.
This is possibly why energy use has flattened while GDP clips along at its normal exponential curve - we're also more efficient.
Efficency in the use of energy ti generate the same amount of lumens, because it would be REALLY fun to have a 100W led lamp in my bathroom mirror (my parents still have 2 of these traditional lights ).
I mean...energy conversion to lumen is fine but i think it's a little pedantic
I found the following comment about Smil:
"There is a way how to evaluate the quality of prophets, seers and visionaries. Find their 5,10,15 years old predictions. I own the Smil’s book: Energy Myths and Realities: Bringing Science to the Energy Policy Debate (2010). So have a look how good prophet he was 10 years in advance and focus on photovoltaics (I own Czech translation of the book, so I need to re-translate his text back to English, I hope I will not skew his ideas too much):
* To get 1 PWh/year of electricity you need to install about 450 GW worth of solar panels. You need dozens of years to acomplish such task. Reality check: 3 years in current speed, in the future probably faster.
* The cost of PV panels fell from 5 USD/W in 2000 to 4.5 USD/W in 2009. He don’t see much perspective of price plummeting as predicted f.e. by Al Gore (who cited the learning curve, Smil counted with 0.05 USD/W in 2020) or by PV industry (1.5 USD/W in 2020). Smil predicted that PV panels would be 25% cheaper in 2020 and 50% in 2030. Reality check: Current price of PV panels is ~0.2 W/USD. While Smil wrote the book manufacturers finally scaled their production of polysilicone and PV cells to cover the demand. Competition among them set the cost of PV panel on the freefall trajectory. PV panels cost less than he predicted for 2030 in 2011.
How credible are such visionaries?"
I will add that in 2023, 447 GW of PV was installed globally. So, we're at the point where Smil's "dozens of years" is being done each and every year.
His doomerism and degrowth perspective points to the early JP, writing articles mocking Obama for lack of progress with EVs points to the latter.
Either way he managed to convince Bill Gates to massively misinvest in climate solutions and while doing so loudly bad mouth all the actual solutions so that alone is a massive net negative for humanity (and, more parochially, for the USA, which is super ironic given his anti-communist stance--another weird JP parallel--as he's been super helpful to the Chinese by letting them solve all the problems he claimed were inpossible and dissuaded US companies from investing in).
Is it saying Smil said (is that meant to be countered with?) PV would cost 0.05 USD/W in 2020? Or was that meant to be Al Gore claiming that price? It seems it can't be his predicted reduction as he said 25% less, so did he want to say that is would be 3.38 USD/W in 2020 (75% of the 2009 price)?
And the current cost - 0.2W/USD is 5 USD a Watt - are the units reversed there? A quick google shows a variety of prices, with nothing being 20 cents a Watt [0] - $0.5-1.50 for the less efficient thin film types quoted here. All seem quite a bit cheaper than $4.5 a watt though.
[0] https://www.forbes.com/home-improvement/solar/cost-of-solar-...
We want things that are the same but less intense, or that are much better at a fractional increase in input.
And we really need it if we want a planet worth living on fifty years from now. So to ignore this desire is dangerous.
Compared to just 50 years ago, I would say that our lifestyles are on average vastly more consumptive, despite being more environmentally aware. We seem unwilling to make the sacrifices that really matter.
I think that some time in the future, our time will be seen as one of massive entitlement. As technology makes things possible, we feel entitled to make use of it if we can afford it. How many people in the 50's were using trucks to drag boats and horse floats around in the suburbs? These are the kind of reasons people will give for their consumption. e.g. "this is the lifestyle I want, it's possible, and why am I not entitled to it if I can afford to pay for it?" (in the financial sense only of course).
We have nuclear power (and soon nuclear fusion) - we can completely decouple energy production from environmental damage.
And trying to force degrowth on populations just makes matters worse, as their economy collapses (Europe), or they resort to even worse forms of energy production like deforestation and wood burning (Sub-Saharan Africa and remote South America).
We just need to use nuclear power.
If you had a magic wand and created 100 TW of nuclear power tomorrow then the papers would fill with stories about Heat Pollution.
Perhaps this comes down to a quality of life vs GDP per capita not being identical. While I could use more energy to consume more, I don't have a very strong desire to go much above my current level of consumption.
But outside of the wealthy there is still huge latent demand for energy and what comes with it.
Not sure how much energy a garden can use, could you elaborate?
I was wondering if there was any way to bring 10.000 Einsteins online. Einsteins who know all about physics, programming, math and so on, cranking up ideas days and night. If the Einsteins never sleep, that would be ideal.
I did the rough math [0] and we get 10x as much GDP out of each kg oil equivalent used as we did in the 1970s when the article bemoans us falling off the HA curve. That was one of my core problems with their point, the amount of energy used is not directly tied to the economic value of the output.
Yes, this was a central simplifying fallacy in the article for me too.
Plenty of phenomena follow a logistic curve [1] — which starts out exponential but then flattens out when it reaches constraints or fills a niche or fully satisfies a need or something.
The initial exponential growth may have been a period where economic productivity was constrained in a major by energy availability. We still have some energy constraints, but they seem to be secondary — and in many areas energy requirements have fallen, as others have pointed out in this discussion. It's too complicated to simply flatten, but modern energy use does seem to broadly resemble a logistic curve.
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so, with the advent of innovations that dramatically drop the cost of energy, we should expect to see energy use grow faster than gdp. that's decoupling but in the opposite direction from the decoupling you're talking about, which has been driven by the 01973–02023 energy crisis
Put another way, instead of producing the products we consume, we offshore production (and the associated energy consumption)
It's always a little hard to read logarithmic values other than those explicitly labelled but it looks like up to a 5-7x difference in energy consumption can have basically no effect on the GDP per capita!
I did the math on the data elsewhere in this thread [0] and in an outcome that should surprise no one there's a transition around 1970 where the ratio between power used and gdp created per capita changes drastically, in 1970 we produced .69 units of GDP per unit of energy and in 2014 we were producing 7.94 using inflation adjusted dollars and oil kg equivalent per capita. We just moved into a different type of economy and there's no data in the graph or article to back up the assertion that falling off the HA curve and consuming ~5x less power per capita our GDP is somehow 5x smaller.
Of course this only tells us about the current state of things, but there are lots of things that would seem ludicrous today that would be feasible if we had a lot more cheap energy. Mass desalation, carbon drawdown, synthetic fuels, electric arc furnaces etc. will all needs loads of energy.
The signum is wrong. In the long term you want it to be one, not zero.
If we would have more energy we would get much richer and not more poor like right now.
German electricity is expensive because gas is expensive in Germany. Electricity will be expensive in Germany until Germany completely stops using gas shipped in via container ship.
Cherry on top some powerful player blew up Nordstream forcing Germany to buy exorbitantly expensive LNG.
Your argument to stop using LNG doesn’t work if you have many parts of industry build with gas infrastructure which can’t be replaced just like that.
They can't, so it isn't.
German wholesale electricity prices are relatively low by European standards - so far this year about 8th cheapest - about 13% cheaper than of France, for example[1]. This reflects the blended cost of production. Household prices are higher than average - because domestic consumption of electricity is taxed more heavily in Germany than the average in Europe.
[0] https://oec.world/en/profile/hs/electrical-energy [1] https://ember-climate.org/data-catalogue/european-wholesale-...
The issue is that Germany exports "waste" electricity. It almost always exports cheap power, and imports at high rates. In negative price events, you will almost always see Germany in the exporter list.
For instance, today, France imported from Germany between 10:30 and 15:45, when market prices reached bottom, and exported to Germany when prices soared, including between 18h and 21h [1].
Another issue is that Germany's inability to control its power production is big enough that it can't be compensated by cross-border trades. That's what can be seen today between 18h and 21h [2], where the price spread between France and Germany became very large.
This kind of pattern has been happening all week.
[1]: https://www.rte-france.com/en/eco2mix/cross-border-electrici... [2]: https://www.rte-france.com/en/eco2mix/market-data
2022 is not an outlier in this regard - on an aggregate basis Germany has been the biggest net exporter of electricity in the world over the last 20 years.
Nothing "waste" about it, the imports and exports in the link are priced in USD, so if your thesis is true, then it would mean even bigger _volumes_ of electric exports.
Yeah, 2022 was absolutely not an outlier in electricity production in Europe...
> the imports and exports in the link are priced in USD, so if your thesis is true, then it would mean even bigger _volumes_ of electric exports.
That is, indeed, true. Germany's export prices are noticeably lower than Germany's import prices for electricity [1].
That means Germany exports _a lot_ of cheap electricity when electricity is abundant, and requires some expensive electricity when it is not. From the pov of reliability of supply, it's not great. From the PoV of market participants, however, that's pretty good, of course.
[1]: average export/import price, fig. 4 - https://www.ffe.de/en/publications/electricity-imports-to-ge...
My claim was based on averaging over the time-series - so the average wholesale prices since 2015 and not just the prices for 2024.
Over the extended period, French wholesale prices have been 12% higher on average than those in Germany.
Note that these are the prices generators receive for selling electricity on the spot market. They are not the same as the prices paid by electricity consumers, which can also include taxes, levies, network charges, subsidies, and supplier profits. They also do not account for hedging.
> Household prices are higher than average - because domestic consumption of electricity is taxed more heavily in Germany than the average in Europe.
https://www.bmwk.de/Redaktion/EN/Artikel/Energy/electircity-... shows 19% VAT, which is definitely a choice by the government. However even before taxes and levies Eurostat showed the price in Germany is about 0.28 EUR/MWh versus 0.22 EUR/MWh in France.
One reason Germany has been able to shift so much electricity to France is the EU Renewable Energy Directive (which excludes nuclear power but includes biomass and biofuels). Intermittent power from Germany counts against any power generated by France's nuclear power stations, helping to meet percentage consumption targets.
https://energy.ec.europa.eu/topics/renewable-energy/renewabl...
Germany is exporting because it produces useless renewable power. It is useless because it does not satisfy the demand. The demand is on dark, cold days, it is for processes that are useless if they are interrupted.
Have you honestly tried buying steel for a project? I have, the vast majority of European suppliers are now borderline useless. Delivering early is as bad as delivering late, bad enough that if the product was free I'd think twice, and they do both.
And no, storage of energy is not cost-competitive. Not even with nuclear. Not even within two orders of magnitude at the scale required, which is not kWh, not MWh, not even GWh, but tens of TWh. The best I've seen gives you time to cold start a gas plant, and that's it. That is what the battery sector gives as achievement. It's not enough and it's not close.
Germany was forced already before that, since Russia used the Gas to blackmail Germany
Part of that is, that EU-wide there are increasing costs to producing CO2. Which makes power from coal and gas more expensive. This caused a strong drop in coal energy in germany in 23, as there were cheaper alternatives. This trend is expected to continue.
Gas costs saw a spike due to the war Russia started and their attempt at blackmailing Germany and consequently cutting gas delivery to Germany. Gas usage has been reduced and gas prices are roughly back to pre-war levels. But indeed, the LNG part of it is more expensive than the russian gas. On the other side, switching heating to heat pumps will reduce the overal gas consumption drastically.
Gas never bore a main load of the grid, it is mostly for supporting short time demands. This role will be important with renewables, but the overall amount of gas energy will drop
At the same time, buildup of renewables has been greatly sped up by the current government, the electricity is already generated buy almost 60% renewables.
Perhaps author is nodding towards replacing fossil fuels with electricity.
Decarbonizing steel uses a lot more energy. Ditto cement, plastics, fertilizers, HVAC, etc.
Anyone care to guess how much more energy our glorious renewable energy future perfect economy will require? 4x? 6x?
Fossil fuels waste most of their energy as heat. Gasoline cars are ~30% efficient, EV's are ~90%.
And heat pumps are often 200-500% efficient, unlike fossil fuel furnaces which cap out around 95%.
Transportation and heating use far more fuel than industrial uses.
Tragically, I got wonksniped by Pueyo's Henry Adams Curve shout out.
TIL He's referring the Roots of Progress thesis. The mythical "stagnation" phenomonen that some "rationalists" used to obsess over.
From the hip: the mistake is measuring national vs global per capita energy use. As many, many have noted, we delegated our energy consumption by moving our mfg overseas.
Mystery solved.
Further, notice similarity between Roots of Progress' graph and https://wtfhappenedin1971.com/
Spoiler: Neoliberalism happened. aka globalization, austerity, supply-side economics
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FWIW: Omitting Pueyo's tangent about the Henry Adams Curve, I found this article to be a great overview of solar PV's current position on its cost-learning-curve.
And I agree the cost of solar PV will decrease for some time. Even faster than the most optimistic projections, which has been the norm for years.
Exciting times.
I look forward to Pueyo's article explaining why price of electricity continues to rise despite decreasing production costs. Transmission? Utility monopolies? Financing?
That's economics 201. The price of a commodity is the cost of the marginal producer. So it doesn't matter how cheap some producers are, the price of a commodity is set by the most expensive producer that is meeting demand. So price of electricity won't drop until cheap producers can meet 100% of demand.
Until that happens, cheap producers enjoy outsized profits, encouraging more cheap producers to join the market.
Those who can buy their energy in bulk and store it efficiently, or only consume when the price is lower than X, will pay a lower rate than those who cannot store energy, or who pay to have someone else store it (again, arbitrage)
A classic example here is cars. A typical Tesla would have about 65kwh of usable battery. A gallon of fuel represents about 31 kwh. So, a 1 to 1 replacement would mean that Tesla would have about 8x less range than it actually has compared to a car with e.g. a 15 gallon tank and. pretty decent mileage of 16 miles to the gallon. Reason: a Tesla manages about 4-5 miles per kwh which amounts to about 250-300 miles range. Let's low ball that to 250. Meaning, you can drive about 8 cars more per kwh of electricity than per kwh of ICE car. Switching all road traffic to electric would mean we actually save a lot of energy. Maybe not 8x but it's going to be substantially less than what we currently consume in fuel for road traffic.
People underestimate how quickly this is going. Most commercial fleets are switching sooner rather than later. They have to, the cost savings are to large to ignore. That's most of the traffic on roads and it's not going to take decades.
Heating and cooling with heat pumps is the similar. A good heat pump that is installed properly should deliver a COP of about 4. Meaning you get 4 units of heat (or cooling) for every kwh you put in. A gas heater has a COP of slightly below 1. 1 is it's theoretical maximum. So switching industrial and domestic heating/cooling over to heat pumps is going to deliver some pretty significant savings as well. Mostly industries have barely scratched the surface on this topic. Industrial heating is mostly still based on burning gas or other fossil fuels. That's because gas used to be cheap and electricity used to be expensive.
Now that that cost has flipped around, companies are slow to adapt. But eventually some companies will start figuring this out and once they do it might save them a lot of money and make them a lot more competitive. And all that is before you consider using cheap off peak electricity when wholesale energy prices occasionally go negative!
4x-5x overall more electricity usage sounds about right. I expect it to be more because as energy keeps on getting cheaper we'll keep on finding new uses for it as energy prices keep on dropping. Assuming everything stays the same is not a great way to make predictions about the future. Things rarely do. But it's not that unreasonable to assume a 5x increase to happen over the next few decades. But it will cost us a lot less than our current energy spending. If we keep on going at the pace we are currently going we'll get there easily. And there are good reasons to expect things to speed up actually.
Solar cost will keep on shrinking. Especially in the US there is a lot of potential for improvements. That's because cost is currently inflated due to a combination of import tariffs and asinine regulations that mean installation cost is insanely high compared to other countries. Some of that regulation is courtesy of fossil fuel companies lobbying for this. But both are fixable problems. And more importantly, both are non technical problems. Meaning that international competition between countries (and domestically between states) will force the issue ultimately.
unless the humans die out as yet another sad single-planet species