US Coal On Track For Record Capacity Decline, Closing 15.4 Gigawatts

The closure of coal-fired power plants across the United States is currently on track to set a new record this year, with at least 22 plants in 14 states worth 15.4 GW going dark, according to report published by the Institute for Energy Economics and Financial Analysis.

IEEFA currently expects a total of 15.4 GW of coal-fired capacity to close during 2018 — made up of 44 units at 22 plants in 14 states across the United States. Already this year 11 GW has been closed, and IEEFA expects the trend to continue through to the end of the year, “easily” exceeding the record 14.7 GW worth of coal-fired generation capacity which was closed in 2015.

Further, the IEEFA expects an additional 21.4 GW of coal-fired capacity closing over the next six years. This will bring the total coal-fired capacity closed between 2018 and 2024 to 36.7 GW — made up of 117 units. This will cut the country’s 246 GW coal-fired power fleet by 15% through to 2024.
 

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Coal-fired power plant are closing because they are not able to compete with other energy sources (gas, renewables).

In his blog, Joseph Daniel listed the huge amounts of money some coal power plant have lost in 3 years :

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Those predictions for the next 6 years are underestimates. That only lists currently planned closures. For future year it looks like a slowdown in planned retirements, but I wonder if more will be announced for future years.

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These predictions are not very accurate. I think it will be over 20% or more of coal generation closed by 2024. Just have to wait if China and India stop building new plants by the end of next year. China is already slowing down and India is aggressively pursuing solar. 

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CoalSwarm, the Sierra Club and Greenpeace report 84GW of new coal worldwide in 2016 with 35GW retired; 60GW of new coal in 2017 with 28GW retired.  The big problem will be closing the existing 1996GW of coal-fired plants quickly enough. 
 

https://endcoal.org/wp-content/uploads/2018/03/BoomAndBust_2018_r6.pdf

This report is worth looking at for a global view. Pretty grim reading with 656GW of new coal in active development. 

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(edited)

On 10/30/2018 at 7:21 PM, BlackTortoise said:

These predictions are not very accurate. I think it will be over 20% or more of coal generation closed by 2024. Just have to wait if China and India stop building new plants by the end of next year. China is already slowing down and India is aggressively pursuing solar. 

This article may dispel your present assumptions. 

Coal consumption

Global coal consumption grew by 25 mtoe, or 1%, the first growth since 2013

 https://video.search.yahoo.com/search/video?fr=mcafee&p=cinder+blocks#id=3&vid=d198872e44d953c95fd114bb3e84c6f6&action=click

Edited by ronwagn
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14 hours ago, ronwagn said:

This article may dispel your present assumptions. 

Coal consumption

Global coal consumption grew by 25 mtoe, or 1%, the first growth since 2013

 https://video.search.yahoo.com/search/video?fr=mcafee&p=cinder+blocks#id=3&vid=d198872e44d953c95fd114bb3e84c6f6&action=click

Best off following the longer term trends.

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On 10/31/2018 at 11:14 PM, ronwagn said:

This article may dispel your present assumptions. 

Coal consumption

Global coal consumption grew by 25 mtoe, or 1%, the first growth since 2013

 https://video.search.yahoo.com/search/video?fr=mcafee&p=cinder+blocks#id=3&vid=d198872e44d953c95fd114bb3e84c6f6&action=click

 

On 11/1/2018 at 1:50 PM, DA? said:

Best off following the longer term trends.

Personally, I weight market forces more highly than technical analysis.  The main driver of coal's decline has been cheap natural gas, but there's no guarantee natural gas will remain cheap.  The oil industry put us through this once before, actually.  In the 1960's and early 1970's, oil was thought to be cheap and plentiful.  We built oil-fired power plants to take advantage of low-cost oil only to pay the price later.  Today, there's almost no oil-fired generation, and that which remains is on it's way out.

From a risk analysis point of view, I wouldn't trust the oil & gas industry with electricity generation because nat gas (NG) prices are largely out of their hands. NG is a global commodity.  Foreign wars, politics, global demand, and global production have and will strongly affect its price, whereas coal prices have proven incredibly stable.  What we're doing right now is accepting large instability for a small price decrease.  Both price and volatility are important when investing; NG may not be a wise financial move. 

If we really must look at "longer term trends", we shouldn't forget the global picture: 
- China made a show of abandoning new coal plants, but the economics of coal are sufficiently strong that provinces are defying China's central government.  China's coal consumption will continue to rise. 
- India's coal consumption has only increased.
- Africa - a cost-sensitive region - is building coal.  
- SE Asia is building coal, much of which it will import.
- On that note, US coal exports have risen significantly.  

It appears that coal is only declining in select regions for select reasons: 
- The US, due to cheap natural gas.
- The rest of OECD nations, ostensibly for environmental reasons. 
- A handful of countries, such as France, because they had minimal, aging coal generation to begin with. 

The EIA confirms that picture.  It also confirms that world wide coal consumption will increase, as Ron suggested.  US exports are increasing along with it.  If US domestic coal consumption decreases and exports increase, what happens to US coal demand?  The EIA seems to think it will remain flat.  Presumably, the EIA is assuming the same low NG prices and the same falling renewables prices as everyone else.  In other words "remaining flat" is the worst-case scenario for coal.  Coal is not dead.  

The best-case scenario for coal is that NG prices spike and renewables prove unable to meet their lofty predictions, in which case coal will be in heavy demand.  We shall see how it plays out.  

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4 minutes ago, mthebold said:

- China made a show of abandoning new coal plants, but the economics of coal are sufficiently strong that provinces are defying China's central government.  China's coal consumption will continue to rise.

China's central government controls what the provinces do and the media is under strict control.  Provinces may wander somewhat and for some time, but the central government ultimately tells them what they can and can't do.  Therefore, I would surmise that the provinces are doing what Beijing approves of with respect to coal, and oil, and gas, and nuclear, and wind, etc.  

A point about media control in China: foreign media companies do the best they can to find out what is really going on around the country, but even they are subject to manipulated information from their sources, industrial or governmental.

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18 minutes ago, Dan Warnick said:

China's central government controls what the provinces do and the media is under strict control.  Provinces may wander somewhat and for some time, but the central government ultimately tells them what they can and can't do.  Therefore, I would surmise that the provinces are doing what Beijing approves of with respect to coal, and oil, and gas, and nuclear, and wind, etc.  

A point about media control in China: foreign media companies do the best they can to find out what is really going on around the country, but even they are subject to manipulated information from their sources, industrial or governmental.

I always took their multi-year plans as gospel but it appears that they are much more flexible than I thought. They had big plans for using more natural gas, but apparently, it is on the back burner. I think they are more interested in preserving their strong economy through competitiveness. Trump has put that in question to some extent. 

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24 minutes ago, Dan Warnick said:

China's central government controls what the provinces do and the media is under strict control.  Provinces may wander somewhat and for some time, but the central government ultimately tells them what they can and can't do.  Therefore, I would surmise that the provinces are doing what Beijing approves of with respect to coal, and oil, and gas, and nuclear, and wind, etc.  

A point about media control in China: foreign media companies do the best they can to find out what is really going on around the country, but even they are subject to manipulated information from their sources, industrial or governmental.

Sounds like they give lip service to global warming to appease foreign leaders, but will continue doing exactly what they want to do.  Does that sound accurate? 

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4 minutes ago, mthebold said:

Sounds like they give lip service to global warming to appease foreign leaders, but will continue doing exactly what they want to do.  Does that sound accurate? 

Absolutely, but that doesn't mean they won't use renewables, just so long as the economics work out.  Anything for them to appear to be the world leader, in anything positive, but economic growth and therefore their grip on power remain constant priorities.  It should be noted also that the Chinese leadership also seems to seriously have their people's best interests at heart; more so than many "great nations".  They are VERY VERY aware that they have a serious pollution problem (it's huge!) and that it is affecting the people every day in their health, but it also costs the government and the economy huge amounts of money for health care and lost productivity.

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13 minutes ago, mthebold said:

Sounds like they give lip service to global warming to appease foreign leaders, but will continue doing exactly what they want to do.  Does that sound accurate? 

I think so!

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39 minutes ago, Dan Warnick said:

China's central government controls what the provinces do and the media is under strict control.  Provinces may wander somewhat and for some time, but the central government ultimately tells them what they can and can't do.  Therefore, I would surmise that the provinces are doing what Beijing approves of with respect to coal, and oil, and gas, and nuclear, and wind, etc.  

A point about media control in China: foreign media companies do the best they can to find out what is really going on around the country, but even they are subject to manipulated information from their sources, industrial or governmental.

Knowing that it's hard to trust the official information and media, a UK based think tank has used satellite imagery to assess the everyday use and on-going profitability of coal power plants in China. Carbon Tracker was able to look at the plumes produced by coal power plants in China and estimate how long the power plant was in “on” state. It also applied machine learning—using data from US and European coal power plants (which typically report without much delay)—to the images of Chinese plants and estimated how much power each plant was generating while running.

And with this methodology they have reached interesting findings :

  • 40% of China’s coal power stations are already losing money, and this could rise to 95% by 2040 because of the cost of complying with air pollution regulations and a rising carbon price
  • It will be cheaper to build new onshore wind farms than operate existing coal plants by 2021. New solar PV will be cheaper than running coal by 2025
  • China’s National Energy Investment Group, the world’s largest power company, risks losing $66 billion in stranded assets – half its total capital – if it pursues business as usual
  • Two other companies risk losing more than their total capital in stranded assets – Guangdong Yudean Group ($22 billion) and Zhejiang Energy Group ($26 billion)
  • All China’s coal power owners can save billions by retiring coal plants in line with U.N. climate targets, with a total $389 billion at risk

https://www.carbontracker.org/40-of-chinas-coal-power-stations-are-losing-money/

https://qz.com/1419899/satellite-images-reveal-coal-power-is-bad-business-for-china/

Carbon Tracker tested its satellite-based modelling techniques in countries where information about coal plant utilisation rates is available and found it was 91% accurate in the US and 92% in the EU.

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6 minutes ago, Guillaume Albasini said:

Knowing that it's hard to trust the official information and media, a UK based think tank has used satellite imagery to assess the everyday use and on-going profitability of coal power plants in China. Carbon Tracker was able to look at the plumes produced by coal power plants in China and estimate how long the power plant was in “on” state. It also applied machine learning—using data from US and European coal power plants (which typically report without much delay)—to the images of Chinese plants and estimated how much power each plant was generating while running.

And with this methodology they have reached interesting findings :

  • 40% of China’s coal power stations are already losing money, and this could rise to 95% by 2040 because of the cost of complying with air pollution regulations and a rising carbon price
  • It will be cheaper to build new onshore wind farms than operate existing coal plants by 2021. New solar PV will be cheaper than running coal by 2025
  • China’s National Energy Investment Group, the world’s largest power company, risks losing $66 billion in stranded assets – half its total capital – if it pursues business as usual
  • Two other companies risk losing more than their total capital in stranded assets – Guangdong Yudean Group ($22 billion) and Zhejiang Energy Group ($26 billion)
  • All China’s coal power owners can save billions by retiring coal plants in line with U.N. climate targets, with a total $389 billion at risk

https://www.carbontracker.org/40-of-chinas-coal-power-stations-are-losing-money/

https://qz.com/1419899/satellite-images-reveal-coal-power-is-bad-business-for-china/

Carbon Tracker tested its satellite-based modelling techniques in countries where information about coal plant utilisation rates is available and found it was 91% accurate in the US and 92% in the EU.

  1. Who is the think tank?
  2. 40% are losing money: Losing money?  Air pollution regulations?  Rising carbon price?  Does the think tank know, or care, how this works in China?  Or does it make better sense for them to relate everything to how it works in their idea of how the West should operate?
  3. Cheaper to build new onshore wind farms:  Where?  Are they aware that virtually every square centimeter in China is occupied with people, farms, companies and buildings, and all that sustains them?  Cheaper to close the coal facilities and risk, yes even risk, power generation gaps for the population and industry?  3-5 years from now?
  4. CNEI: again, are they aware how this sector works in China?
  5. Ditto.
  6. "in line with U.N. climate change targets":  Again, who is the think tank?  Who funds them?
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(edited)

27 minutes ago, Dan Warnick said:
  1. Who is the think tank? Who funds them?

 

The think tank is Carbon Tracker, an independent financial think tank that carries out in-depth analysis on the impact of the energy transition on capital markets and the potential investment in high-cost, carbon-intensive fossil fuels. It's based in London and has been founded by Mark Campanale ten years ago.  This is how they define their mission :

"We recognize that there is a limited global ‘carbon budget’ of cumulative emissions that must be respected to avoid overshooting 2˚C and destabilizing the global climate. Our view is that capital markets are failing to align the capital allocation process, exposing the owners of fossil fuel companies – their shareholders – to potential lost value, as has already been witnessed in the EU utilities and US coal mining sectors.  We further believe that companies have not sufficiently factored in the possibility that future demand could be significantly reduce by technological advances and changing policy. Our role is to help markets understand and quantify these implied risks."

Carbon Tracker has coined the term "Stranded Assets" now widely used.

 

They are supported by :

  • Bloomberg Philanthropies
  • ClimateWorks Foundation
  • Energy Foundation
  • European Climate Foundation
  • Flora Family Foundation
  • Frederick Mulder Foundation
  • Generation Foundation
  • Grantham Foundation
  • Growald Family Fund
  • Horizon 2020 of the European Union
  • Kenneth Miller Trust
  • KR Foundation
  • MAVA Foundation
  • NextGen Climate Action
  • Oak Foundation
  • Rockefeller Brothers Fund
  • RS Foundation
  • SEM Charitable Trust
  • Tellus Mater
  • The Ashden Trust
  • The Climate Change Collaboration
  • The Joseph Rowntree Charitable Trust
  • The Kestrelman Trust
  • The Polden Puckham Charitable Foundation
  • The Rockefeller Foundation
  • The Velux Foundation
  • The William and Flora Hewlett Foundation
  • V. Kann Rasmussen Foundation
  • Wallace Global Fund
  • Zennstrom Philanthropies
  • Finance Dialogue

 

 
Edited by Guillaume Albasini
typo
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(edited)

I rest my case.

(And I need some sleep.  Enjoying the discussions and learning a lot.  Thanks all.)

Edited by Dan Warnick

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12 hours ago, mthebold said:

Presumably, the EIA is assuming the same low NG prices and the same falling renewables prices as everyone else.  In other words "remaining flat" is the worst-case scenario for coal.  Coal is not dead.  

You really trust any "forecast" (they don't even call it a forecast these days as they are so bad at it). NG hammered coal but now renewables have become so cheap why would you risk long term investments that are so obviously bad. "remaining flat" is the best case scenario for coal. Coal is dead, just doesn't seem to know it (although looking at stock prices for coal mining firms the market knows it), even NG is a dead man walking.

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8 hours ago, DA? said:

You really trust any "forecast" (they don't even call it a forecast these days as they are so bad at it). NG hammered coal but now renewables have become so cheap why would you risk long term investments that are so obviously bad. "remaining flat" is the best case scenario for coal. Coal is dead, just doesn't seem to know it (although looking at stock prices for coal mining firms the market knows it), even NG is a dead man walking.

I've said it before, and I'll say it again: show me renewables beating coal/NG prices under the following conditions: 

1) No subsidies, renewables mandate, revenue guarantees, or artificial supports of any kind. 
2) Operating in a market with 50-100% renewables
3) All costs included: storage, backup generation, decommissioning, etc.  
4) Including the cost of handling those windless/sunless days. 

You've had ample opportunity to answer these questions, yet you've repeatedly refused to do so, choosing instead to repeat the same line about coal's death. The lady doth protest too much, methinks. 

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5 minutes ago, mthebold said:

I've said it before, and I'll say it again: show me renewables beating coal/NG prices under the following conditions: 

1) No subsidies, renewables mandate, revenue guarantees, or artificial supports of any kind. 
2) Operating in a market with 50-100% renewables
3) All costs included: storage, backup generation, decommissioning, etc.  
4) Including the cost of handling those windless/sunless days. 

You've had ample opportunity to answer these questions, yet you've repeatedly refused to do so, choosing instead to repeat the same line about coal's death. The lady doth protest too much, methinks. 

Why does it have to be either or? Why can renewables and fossil fuels not co-exist in the energy mix? 

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20 hours ago, ronwagn said:

I always took their multi-year plans as gospel but it appears that they are much more flexible than I thought. They had big plans for using more natural gas, but apparently, it is on the back burner. I think they are more interested in preserving their strong economy through competitiveness. Trump has put that in question to some extent. 

My simple understanding is that the central government needs to appease the population. When people are generally fed they start worrying about things like air quality etc... If peoples job prospects start declining then that becomes more pressing to addres.

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11 minutes ago, mthebold said:

I've said it before, and I'll say it again: show me renewables beating coal/NG prices under the following conditions: 

1) No subsidies, renewables mandate, revenue guarantees, or artificial supports of any kind. 
2) Operating in a market with 50-100% renewables
3) All costs included: storage, backup generation, decommissioning, etc.  
4) Including the cost of handling those windless/sunless days. 

You've had ample opportunity to answer these questions, yet you've repeatedly refused to do so, choosing instead to repeat the same line about coal's death. The lady doth protest too much, methinks. 

1) you only have to look at recent feed in tariffs to show you examples, although fossil fuels have plenty of assistance as well. Get out there in the real world and do some homework.

2) Err, it's only just beginning, you have to wait a bit. What I've been saying is renewables are starting to cut in to markets and the trend is for this only to speed up.

3)refer to question 2

4)this old and rather stale donut comes up again, this one has been put to bed along time ago. You know smart systems, DC grids, storage and so on.

Really you need to go and look whats happening today in the energy markets and see 50% of newly installed generation is renewable. It's kicking the arse of fossil fuels and especially coal. The old lady doth protest too much, methinks. Coal is dead and coal is dead. Had to say it twice as it is really in two ways as an industry with a decent future and as a left over from a life form.

 

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5 minutes ago, DA? said:

1) you only have to look at recent feed in tariffs to show you examples, although fossil fuels have plenty of assistance as well. Get out there in the real world and do some homework.

2) Err, it's only just beginning, you have to wait a bit. What I've been saying is renewables are starting to cut in to markets and the trend is for this only to speed up.

3)refer to question 2

4)this old and rather stale donut comes up again, this one has been put to bed along time ago. You know smart systems, DC grids, storage and so on.

Really you need to go and look whats happening today in the energy markets and see 50% of newly installed generation is renewable. It's kicking the arse of fossil fuels and especially coal. The old lady doth protest too much, methinks. Coal is dead and coal is dead. Had to say it twice as it is really in two ways as an industry with a decent future and as a left over from a life form.

 

 

20 minutes ago, Rasmus Jorgensen said:

Why does it have to be either or? Why can renewables and fossil fuels not co-exist in the energy mix? 

They will coexist. @DA? mentioned Tuscon's latest feed-in tariff, which I addressed here.  The Tuscon plant is a solar peaking plant suitable for shaving mid-day and early-evening cooling loads.  Unsubsidized, it does so at 2X the price of existing coal/new CCGT, but potentially below the cost of simple-cycle peaking NG plants. I.e. it shows unsubsidized economic viability for peaking loads in hot regions with lots of sun - and that's ALL it shows.  Depending on how low renewable costs go, they may gain more market share, but they're a long way from replacing base-load generation.

The point of contention is DA?'s claim that conventional generation is dead.  In some distant future where renewables, storage, and transmission all become remarkably cheap while conventional technology remains stagnant, that could feasibly happen.  However,

1) No one has shown a clear road map to that future. All we have are heavily-engineered cost reduction trends.
2) When @DA? mistook the Tuscon project for unsubsidized base-load generation, he demonstrated that he hasn't a clue.

A final thought: storage technology requires less land than solar, has lower installation costs than either wind or solar, can be used in any region, and actually reduces demand on transmission infrastructure. Storage technology also benefits from R&D in other industries, such as automotive, and increases the capacity factor of base-load generation.  If I had to bet, I would guess a combination of base-load and storage becomes the go-to option for utilities, with wind & solar filling only niche applications.  That's just spit-balling though. 

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2 minutes ago, mthebold said:

 

They will coexist. @DA? mentioned Tuscon's latest feed-in tariff, which I addressed here.  The Tuscon plant is a solar peaking plant suitable for shaving mid-day and early-evening cooling loads.  Unsubsidized, it does so at 2X the price of existing coal/new CCGT, but potentially below the cost of simple-cycle peaking NG plants. I.e. it shows unsubsidized economic viability for peaking loads in hot regions with lots of sun - and that's ALL it shows.  Depending on how low renewable costs go, they may gain more market share, but they're a long way from replacing base-load generation.

The point of contention is DA?'s claim that conventional generation is dead.  In some distant future where renewables, storage, and transmission all become remarkably cheap while conventional technology remains stagnant, that could feasibly happen.  However,

1) No one has shown a clear road map to that future. All we have are heavily-engineered cost reduction trends.
2) When @DA? mistook the Tuscon project for unsubsidized base-load generation, he demonstrated that he hasn't a clue.

A final thought: storage technology requires less land than solar, has lower installation costs than either wind or solar, can be used in any region, and actually reduces demand on transmission infrastructure. Storage technology also benefits from R&D in other industries, such as automotive, and increases the capacity factor of base-load generation.  If I had to bet, I would guess a combination of base-load and storage becomes the go-to option for utilities, with wind & solar filling only niche applications.  That's just spit-balling though. 

Oh you are funny, you addressed nothing. You only showed your total lack of understanding on how renewables are cutting into markets and how technology trends.

I have not made the point conventional generation is dead but it is a dead end. Distant future? what do you call that? Again look at the trend and fossil fuel trend that's slowed to almost a stop..

1)Yes plenty of research and work has been done on a future powered by renewables, even if ignored by some. The trends are clear, no heavy engineering needed.

2)what subsidises make it so much more expensive than other bids? and why did those other bids come nowhere near.

Yup thank you storage is becoming cheap following that trend, the trends work or is only ones that you want to work? That's the great way to get a technology in, by niche applications. As the technology improves so those niches grow until it's full on markets.

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(edited)

10 hours ago, DA? said:

Oh you are funny, you addressed nothing. You only showed your total lack of understanding on how renewables are cutting into markets and how technology trends.

I have not made the point conventional generation is dead but it is a dead end. Distant future? what do you call that? Again look at the trend and fossil fuel trend that's slowed to almost a stop..

1)Yes plenty of research and work has been done on a future powered by renewables, even if ignored by some. The trends are clear, no heavy engineering needed.

2)what subsidises make it so much more expensive than other bids? and why did those other bids come nowhere near.

Yup thank you storage is becoming cheap following that trend, the trends work or is only ones that you want to work? That's the great way to get a technology in, by niche applications. As the technology improves so those niches grow until it's full on markets.

Please supply some data showing that electric storage is "cheap". From everything I have seen it is quite expensive. Something like 43% the price of an electric vehicle.  That is a minute amount of battery storage compared to what a wind turbine or solar array would need. Natural gas, oil, diesel, coal, and propane storage actually is cheap. An automobile gasoline tank costs about $225.00

https://www.statista.com/statistics/797638/battery-share-of-large-electric-vehicle-cost/

Edited by ronwagn
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