Wind, solar electricity generation and battery storage all have low operation costs, once in operation they will produce electricity even if the electricity price is close to zero. Investment costs have been the barriers to growth. But the investments barriers have been reduced. In the last 15 years the investment costs for wind power has fallen by 50%, for solar PV installations the reduction is 80% and for batteries 90%.
The world’s cheapest electricity now comes from solar and wind energy, and the cheapest battery installation are also so low that they outcompete any thermal power plants. They are not only providing cheaper electricity than new thermal power plants, but are even beginning to outcompete some existing ones. As a result, owners of existing plants need subsidies to save their assets, sometimes legal, sometimes not.
But such subsidies will not continue forever. Solar, wind and batteries will take over. The research institute RethinkX has published a report calling such a future system ”Stellar Energy”, claiming that we will enter a period where energy will be superabundant.
While many believe the opposite, the RethinkX report claims such a system will be economically the best in almost all countries in the world.
As the marginal cost will be near zero, the electricity grid will become similar to the internet: with a set of conditions of use and a monthly payment, electricity will be for free. The system will have to be built to manage the extreme hours of the year, but at all other times, there will be surplus.
Today, this abundance is described by power companies as a problem which they solve by shutting down renewable electricity generators, called curtailment. RethinkX suggests we instead should use the abundant electricity available free of charge: Operate AI centers, produce food, recycle waste, capture CO2 from the air, etc.
While RethinkX are good at describing the opportunity, they are not so concrete on how it is to be done. The analogy to the development of the broadband internet, however, is also the vision of Jonas Birgersson. His unicorn company introduced high capacity internet to households for a small fixed monthly price. Now has started to do the same thing with electricity. In addition to low cost solar, wind and batteries, he is also using the low cost power electronics developed by the automotive industry to manage the interchange of electricity between cars and the grid.
His concept of energy community building, would also solve the stability problems of traditional AC systems. The interaction between the household, our industry and other actors in the grid would follow a protocol and no power would be sent without electronically negotiating the conditions of the power flow.
Instead of uncontrolled electrons flowing wherever the voltage happens to be low, in his grid, electrons flow to where they are told to go. In relation to the high voltage alternating current, grid power electronics can also serve reactive power and frequency stabilization, even from the household battery units.
It is not just fantasy. The first such energy community was opened 26 of April in Lund, and it worked.
