Table 1 - Current energy plant capital cost in $/W
Gas turbine 0.5
Wind 2.0
Solar tower 2.5
Nuclear 6.0
One MBtu is equivalent to 33.43 watts expended for a year. Multiplying the
above values by 33.43 we can thus obtain energy plant cost in $ per MBtu/yr
assuming a plant life of one year.
Table 2 - Current energy plant capital cost
(in $ per MBtu/yr, or $T per quad/yr)
Gas turbine 17
Wind 67
Solar tower 83
Nuclear 200
The above values have to be multiplied by 10^9 to obtain cost in $ per
quad/yr. So, the above numbers represent the current cost in trillions of
dollars per quad/yr energy creation capacity. Thus multiplying the values
of Table 2 by 400 we have the cost of plant capacity to provide current
world energy needs of 400 quads:
Table 3 - Current energy plant capital cost in $T to supply world needs
Wind 26,800
Solar tower 33,200
Nuclear 80,000
If we discard nuclear energy as not cost effective, and assume half solar
and half wind energy production, we have 30,000 $T capital cost to provide
all the worlds energy needs by renewable means. Assuming a 3 percent cost
of capital (reasonable assuming value of energy inflates too) we have an
annual cost of 1500 trillion dollars to produce the 400 quads. That is
(10^6)(1500x10^9)/(400x10^15)$/MBtu = $3.75 per MBtu.
If we triple the cost to include cost for novel energy transportation and
storage methods, we have a cost of $11.25 per MBtu. This is very
competitive with the DOE 2003 costs of energy, as shown in Table 4.
Table 4 - Current costs of energy in $/MBtu
Electric 25.20
Methane 9.10
Heat. Oil 9.25
Propane 13.46
Kerosene 11.41
It appears the job of converting to renewable energy can be accomplished
starting now, especially where long trades are not required. The capital
cost will ultimately be on the order of 90,000 trillion dollars, but
invested over the, say, 20 years required to accomplish the plant
development it will be about 4,500 trillion per year.
At $12/MBtu, the world energy requirement costs about 4,800 trillion
dollars per year. The capital to achieve the conversion can be obtained by
doubling the cost of energy for about 20 years. Considering most of the
energy is consumed on the continents in which it is produced, the cost
could be substantially less than that estimated, possibly by as much as 60
percent less. The powerful effect of economy of scale has not been applied
either.
Unfortunately, as with a national renewable energy policy, all that is
missing is the political will to make it happen. It is even less likely to
happen on a global basis than a national basis. However, emerging
capitalists should have their noises in the air. The smell of money is
there. They may well wipe out those unable to think in any terms other
than big oil. The future is likely another example of survival of the
fittest and the adaptable.
Any corrections would be appreciated.
Regards,
Horace Heffner
