The Green New Deal could make electricity 28 times more expensive

Written by David Wojick on September 6, 2024. Posted in Current News

Below, I show how the Green New Deal can cause the average household electricity bill to go up a crushing $52,500.

The reason is simple. Wind and solar require a lot of battery backup, and we use a tremendous amount of electricity, so the cost of all these batteries is many trillions of dollars.

Here is the basic derivation. It is kept simple, and the numbers are all rounded off so they can be remembered. (The U.S. Energy Department should have done a detailed analysis long ago.)

— The electricity storage capacity required to replace today’s fossil-fueled electricity generation nationwide with intermittent wind and solar is 250,000,000 MWh.

— Assume grid-scale battery facilities cost $300,000 per MWh of storage capacity. (Today’s cost is higher.)

— Thus, the capital cost of this storage is 75 trillion dollars.

— Spreading this cost over 20 years gives an annual cost of 3.75 trillion dollars.

— U.S. household electricity usage is 1.5 trillion KWh per year.

— Thus, the household cost is $2.50 per KWh.

— Average household usage is 10,500 KWh/yr.

— Thus, the annual household cost of this storage capacity is $26,250.

— Today’s average annual electric bill is $1,800.

— Thus, the electricity cost increase is over 14 times as much.

In short, everyone’s electricity bill will be 14 times greater than today if wind and solar replace today’s fossil fuel-powered generation under the Green New Deal.

This will be true of industrial and commercial consumers as well, which will drive up the cost of virtually all goods and services. This impact is truly inflationary.

But this does not include the electrification of transportation and gas heat, which are also part of the Green New Deal. Electrification is often estimated to roughly double the amount of electricity generated.

— Given electrification, the cost of electricity might jump a whopping 28 times today’s cost. The Green New Deal causes the average household electricity bill to go up a crushing $52,500.

Of course, the economy would likely collapse before this happened, but this simple analysis is the necessary starting point for thinking about the incredible cost impact of the Green New Deal.

There are lots of technical refinements to be added to this analysis to make it a good engineering cost estimate. Some make the numbers go down; others make them go up. I would love to see this done and would happily help.

For example, the cost of batteries might go down a lot, and there are studies that project this. Given that the material requirements for this vast number of batteries greatly exceed our present mining and manufacturing capacity, this may be unlikely, but it is not impossible.

On the other hand, this simple analysis assumes batteries charge and discharge from zero to 100% of capacity. If it is actually 10-90 or 20-80, then a great deal more storage capacity will be needed.

Then, too the storage requirement can be reduced by overbuilding the wind and solar generating capacity. However, this reduction is limited; I have been told to 180 million MWh because there is still no solar at night and no wind when it does not blow hard enough.

But it is unlikely that these giant batteries have an average full performance life of 20 years.

Note, too, that this analysis does not include the cost of the enormous amount of wind and solar generating facilities. Nor does it include the cost of borrowing trillions of dollars.

The basic point is that the Green New Deal is impossibly expensive. There is no cure for intermittency.

See more here Cfact.org

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