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I was recently listening to an episode of Power Hour with an economist specializing in electricity pricing. There were many interesting revelations made about the electricity market, but one thing people don't realize is that renewables artificially drive up the cost of other generating sources.
Much (most?) of electricity production costs comes from the fixed costs of infrastructure. Since renewables can't reduce the amount of infrastructure needed, due to the need to always have generating capacity for when they aren't producing, they don't reduce fixed costs but instead increase them. If for instance, a natural gas generator might be built with the expectation of having a lifetime production of 75% of nameplate production capability. The cost of that generator is amortized over delivering those anticipated gigawatt hours.
If renewables reduce the amount of electricity generated by the plant to 35% of nameplate capacity, the full cost of the plant is spread over fewer produced gigawatt hours.
Imagine owning a $30k ICE vehicle, and you want to cut down on expenses by purchasing a $30k solar EV. You have to keep the ICE because it's already paid for, and it's needed for when the sun isn't shining or for trips outside solar EV range. Normally you would put 10k miles on it per year but instead only put 3k miles on it because the solar EV covers the other 7k. The cost per mile increases for the ICE because the purchase price is spread over fewer miles. The cost per mile for the solar EV appears to be lower since the fuel is free, but overall costs per mile have increased due to paying for 2 vehicles.
The value of electricity isn't just in producing it, it's producing it when it's demanded. How much would we pay a waiter who comes in to work whenever he feels like it vs one that works when scheduled? What would the reliable waiter think if he had to go home and get no pay whenever the unreliable waiter decided to show up?
I'm as excited as anyone for renewables to displace fossil fuels, but I'm not so naïve to dismiss the unreliable waiter problem.
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