We Don’t Need Base Load Power

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Rick Perry, the former Governor of Texas and former Secretary of the Department of Energy, told Fox News in an interview that we need base load power. He believes we need base load power because it is what we use when we turn a light on at 2:00 in the morning. He’s wrong. But unfortunately, a lot of people understand things the way he does, and they are holding the energy transition back.

Base load power may supply the electricity in the middle of the night in many cases, but power from other sources could be used instead. The issue is not technical. It is just a matter of cost. If something came along that could provide that electricity cheaper and better, we could use it instead and save money. (Spoiler: something has.)

We should think about what the base load is and why it matters.

Back in the early days of the electric grid, power providers came to understand that there would be a minimum demand level that they could count on always being there. Demand would never fall below that level, as long as the grid was operating normally. That minimum demand level is the base load. Please note that the base load is the minimum demand level.

A base load power plant is designed specifically to provide for the minimum demand. Because the base load would always be there, the plant could run at 100% power, 24/7. The plant never would need to adjust to changes in demand, so it could be built without the features necessary to follow changes in demand. And that made construction and operation of the plant very inexpensive.

Obviously, since base load plants cannot adjust for changes in demand, there have to be other power plants that perform that job. They include load-following plants, along with some other types. They supply all of the electricity we use in excess of the minimum. The problem we have with them is that the electricity they generate costs a lot more than base load power.

Perhaps we should make note of a few things here.

1. The big trick to running an electricity grid is to make sure that power production meets demand as closely as possible.

2. The load-following power plants could provide 100% of our electricity, if we were willing to pay the price. In fact really small electric grids generally don’t have any base load power. In diesel-powered grids on islands, the diesel generators automatically meet demand, in their clunky manner. One big problem they have is that the electricity they generate is really expensive.

3. Since demand is always changing, base load power plants cannot supply 100% of grid power over any extended period of time. For example, the only way a grid could be powered entirely by base load power for a full hour would be if the demand remained at the minimum level, unchanged, for that hour, a scenario that is extremely unlikely. Base load plants cannot supply all our power.

So, the reason we use base load power plants is not that they are required technically, but because we have wanted them to keep costs down. We do not need them to provide our electricity at 2:00 AM. We have wanted them to provide a fixed amount of cheap electricity, throughout the day, and that fixed amount would be the minimum we would ever need.

We can view base load power technology as a paradigm for a power grid, but it is just one paradigm where others could be used. And in fact, there is no reason to adhere to the base load paradigm if another comes along that is less expensive.

Recently, NextEra Energy issued its Investor Conference Report 2022 to its stockholders. In it, NextEra Energy claims to be the largest provider of renewable energy in the United States. But it also owns, directly and through subsidiaries, a lot of fossil fuel plants and seven nuclear reactors.

Interestingly, as it looks to the future, NextEra seems not to be particularly interested in thermal power plants, the type that includes base load plants. It is planning to close its last coal-burning plant in 2028. And it expects electricity generated by natural gas to decline to 18% overall for all US producers by 2035. A look at a graphic on page 122 shows us why.

There are some terms used for the chart that require explanations.

• “Near-firm” power assumes a battery that will have reliability during peak hours that is roughly the equivalent of dispatchable generation sources.

• The “storage adder” is the increase in cost of an energy source that is needed to cover the cost of storage.

• We should mention for interest sake that the “carbon adder” is the increase in cost of fossil energy due to governmental policies.

One thing to consider is that while neither near-firm solar nor near-firm wind power would get us through every night reliably by itself, based on the definition for near-firm, a combination of the two could be designed to do that easily for most places, most of the time. This is because solar and wind power are generally complimentary; wind power is strongest at night and in the winter, and solar is only productive during the daytime and generally most productive during the summer. And if there is insufficient power from those two sources, there are other renewable energy sources available, including hydro-power, tidal power, biomass, geothermal, and others. And long-range transmission lines can bring power in from other parts of the country.

NextEra’s chart shows that of the eight electricity sources listed, the least costly are near-firm wind and solar. The others are all more expensive, and with the exception of offshore wind power, they happen to be base load sources. We might note that existing natural gas, nuclear, and coal plants have limited life expectancy and are due to be replaced at some point. And we should also note that the electricity from new natural gas and new nuclear plants is very expensive, by comparison.

(If you have never pitied Bill Gates, now might be the time to start. He has invested quite a lot of money in small modular reactors, and it is hard to imagine how that money can be recovered if NextEra is correct about rates. Small modular reactors will have to compete with near-firm renewables that produce electricity a below 4¢/kilowatt-hour.)

Wind and solar, with occasional additions from other renewable energy resources, could provide nearly all our demand about as reliably as base load plants. Many observers have commented on the fact that we are living in a time when it is reasonable to close existing coal, gas, and nuclear plants because the electricity is too expensive compared to renewable energy. And in fact, base load plants have been shutting down for exactly that reason. So we might ask, is there any reason, aside from cost, to use base load power at all?

One other thing to consider is the quality of the electricity.

Historically, base load plants had a variety of power sources that could provide electricity to cover changes in demand. Some could change their output to meet demand in a quarter hour. Some could respond in a couple of minutes. The cost of the electricity was high — up to 27¢/kilowatt-hour, normally, but sometimes more than that. With changes in supply taking minutes, there are discrepancies between supply and demand, and they can be made up for by changing the frequency of AC power very slightly, which meant that clocks ran too fast or too slowly. More drastic changes in the power can damage motors and other infrastructure. The grid is not perfect, but it works most of the time.

By contrast, the batteries used for near-firm renewable resources can adjust to changes in power demand almost instantly, assuring a far higher quality of electricity than we have had from the base load paradigm. And also, the cost of batteries has dropped to the point that the cost of the ‘solar adder’ is roughly 0.5¢/kWh. Clearly, near-firm renewables are superior.

We should not be surprised by this. The base load paradigm originated at a time when a new car might be a Model T Ford and the fastest trip from New York to San Francisco would be on a coal-burning train. That was about a hundred years ago. It was a time when a really good computer was a slide rule and if you picked up a telephone, you heard an operator say, “number please.” Things have changed since then.