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Expensive electricity and blackouts

Expensive electricity and blackouts

By: Kelley Williams - January 30, 2023

Solar increases the utility company’s investment – and its customers’ cost. The grid becomes more fragile.

What raises electric rates and causes blackouts?  Too many windmills and solar panels.  

What causes too many windmills and solar panels?  Federal subsidies.  

What’s the latest and biggest perverse federal subsidy?  The “Inflation Reduction Act.”  

Why did a Democrat Congress appropriate money for perverse projects?  Aw, come on, man.

Did Republicans vote for the perverse projects?  Come on, man.  Seventeen Republican Senators (including one of Mississippi’s) voted for the Inflation Reduction Act.  

Does Democrat funding for perverse projects end up in Republican states?  Does one hand wash the other?  Does political water run downhill?  Do energy lobbyists just court Democrats?

What’s the difference between Democrat and Republican subsidies?  Who said: “Tax and tax. Spend and spend.  Elect and elect.” Answer: Harry Hopkins, advisor to President Franklin Roosevelt and one of his New Deal architects.  It was winning politics then.  Still is.  For Democrats and Republicans.  And lobbyists – including lobbyists for wind and solar.  Note: there are no energy lobbyists for customers.

What do windmills and solar plants have to do with Mississippi?  Windmills, not so much. They’re for Texas and Kansas (and Oklahoma) where the wind comes whistling down the plain. They generate electricity sometimes (intermittently) when the wind whistles just right.  Their intermittency makes electricity more expensive.  And causes blackouts. Why?  How?  That’s what this article is about.

Solar plants have to do with Mississippi.  They generate electricity sometimes too – when the sun shines.  Entergy Mississippi plans to charge customers for over a billion dollars of intermittent solar generating capacity it builds or has others build for it.  The solar plants are a good deal for Entergy because it gets paid for their cost plus a markup.  The more it spends (and third parties spend on its behalf), the more its stockholders make.  But perversely, the more its shareholders make, the higher its customers cost of electricity and the less reliable their service (more interruptions and blackouts).

Does the Mississippi Public Service Commission care?  It’s supposed to protect customers who are subject to Entergy’s service monopoly.  However, two of the three commissioners seem to care more about solar energy promoters.  One used to be one.  Another one is running for Governor.  He opposed Kemper, but not solar although it’s also bad for customers.  Campaign contributions?

Entergy’s solar plants are like Mississippi Power’s Kemper County Lignite Plant.  Kemper’s investment was driven by perverse tax incentives from a Democrat Department of Energy.  It was promoted by a popular Republican Governor.  Its starting price tag was $1.4 billion.  It was finally abandoned when the cost exceeded $7 billion.  Its experimental gasifier didn’t work at all.  The PSC stuck Mississippi Power customers for $800 million of unneeded generating capacity from its remnants anyway.  Customers paid twice – for more capacity than they needed in the first place.

Solar plants don’t work at all most of the time either.  The sun doesn’t shine most of the time.  A recent article by Isaac Orr explained that subsidies incentivize bad energy choices. According to his 2021 U.S. Energy Information Administration citation, solar worked (i.e., generated electricity) 22% of the time in Mississippi.  That 22% is called the capacity factor.  It may be overstated.

It’s cloudy today as I write this.  So, no solar electricity.  But my lights and heat are on.  My iPad is charging as I write.  I want electricity 24/7/365.  I depend on it.  So does the world.

Where does electricity come from all of the time when solar doesn’t work?  It comes from plants that generate electricity all of the time.  In Entergy’s monopoly service area, where I live, plants that work all of the time are nuclear (Grand Gulf), natural gas, and coal.

These plants power the electric grid we take for granted to assure electricity on demand.  The gird is a network of electricity generators and electricity users.  Utilities increase or decrease generation to meet increases and decreases in customer demand – which changes constantly with weather, time of day, and other factors.

It’s not possible to store utility scale electricity (large quantities of electricity).  There are no batteries big enough.  So, plants that can generate electricity all the time run all the time to meet changing demand loads.  They run faster when demand is high.  Slower, when it’s low.

Some plants called base load plants run fast all the time.  Grand Gulf is a base load plant.  It’s hard to vary the run rate of a nuclear plant.  It’s easy to vary the run rate of a natural gas plant.  So, the output or run rate of these plants changes constantly to balance demand on the grid.  So do coal plant outputs.  That explains Grand Gulf’s capacity factor, or run rate, of 96% in 2021.  And 63% for Mississippi’s natural gas plants, and 44% for its coal plants.  Utilities must have enough excess generating capacity (spinning on standby) to meet changing demand loads.

Utilities must also have excess generating capacity to offset changes in solar generating capacity to keep the grid in balance.  Solar plants generate electricity intermittently (22% of the time).  They are unreliable unpredictable sources of electricity.  Sunshine is free.  But solar electricity isn’t.  The utility must have – or add – duplicate backup natural gas or coal generating capacity when it adds solar.  The customer pays twice – but gets no additional electricity when he needs it.

Solar increases the utility company’s investment – and its customers cost.  So, stockholders make more.  Customers pay more for no more electricity when they need it.  The grid becomes more fragile.  Blackouts, more likely.  Where’s the PSC? PSC, just do your job.  PSC, in case you forgot: Your job is to assure customers affordable reliable electricity.

About the Author(s)
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Kelley Williams

Kelley Williams is a member of Bigger Pie Forum. The mission of Bigger Pie Forum is to research and share educational information that fosters greater economic freedom and individual responsibility. The Forum serves as a voice of free-market encouragement in Mississippi with the goal of stimulating private sector growth for a bigger and brighter Mississippi.
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