An annual energy bill for a typical household will fall to £1,923 in October under regulator Ofgem’s new price cap.
I honestly think it’s appalling that they’re continuing to let these energy providers make obscene profits from us.
An annual energy bill for a typical household will fall to £1,923 in October under regulator Ofgem’s new price cap.
I honestly think it’s appalling that they’re continuing to let these energy providers make obscene profits from us.
Context of the situation is important. You can’t use them interchangeably.
Capex does not matter when we are talking about choosing to generate using existing infrastructure, because capex amortisation is the same regardless of whether you’re generating or not. Choosing whether to generate at 1am on a random Tuesday has nothing to do with your previous capex, but everything to do with your next unit cost. If price is higher than cost, you’ll generate, it not you (probably) won’t.
Capex payback is important when businesses are evaluating building new generation. The spot price at 1am on a random Tuesday has nothing to do with whether you’re choosing to build new infrastructure. What does matter is average unit prices, over time, not one data point.
But you said you wanted more renewables… That’s capex.
I’m not the person you originally replied to when you falsely claimed that renewables are only economically viable because of last generator pricing.
I have explained why that isn’t the case, how both generation and new capacity decisions are made, the different aspects those decisions consider, and how because their next unit cost is lower due to generation input being free they are able to operate profitability at lower spot prices than are achievable for fossil fuels.
One last time - capex payback is a consideration when building new capacity, yes, but that is based on average prices over decades. It is not a consideration when choosing whether to power up or down on at a specific time on a specific day.
Attempting to simplify this to just capex is wrong.
Economically viable means you can raise the capital to build it…higher returns attract more capital
https://www.designingbuildings.co.uk/wiki/Economic_viability
Spain has cut the last generator link so now renewables are not charged at the gas rate.
Let’s see how it works out. It’s already helped reduce inflation there.
Because capex is capex. Buildings, solar, windmills. Doesn’t matter. All that matters is capex roi and opex unit per watt
Now go read this and tell me that capex doesn’t matter
https://www.bbc.com/news/uk-england-norfolk-66263340
I’m done here, you’re clearly not reading what I’ve said if you genuinely believe I’ve said capex never matters.
I said - Renewables are only economically viable because the cost of power is paid on the last generator, which is natural gas.
You said - This is not true, renewables are economically viable at much lower prices than fossil fuels because their next unit cost is effectively zero
And yet I show you sources where increased capex costs are making renewables economically unviable because the capex costs have increased so much due to inflation and the wholesale price they were offered at auction is now not enough to justify the CAPEX to build it.
You’re going in circles because you won’t admit that the horse comes before the cart. You can’t get to zero extra unit cost if you don’t build the fucking thing.
I explicitly covered this in my 3rd comment - quoted below.
@bernieecclestoned @hellothere
I’m quite sure I said nothing of the sort.
This seems to be about semi-fixed costs, which should favour some* renewables, and externalities - which definitely favour renewables, unless the collapse of civilisation and several gigadeaths is ignored as a cost.
IIRC the reason for Siemens pulling out of an offshore project was that the price was artificially fixed low, with a penalty.
@bernieecclestoned @hellothere
* putting up ond more panel, or one more turbine on land is cheaper than burny increments, but the Rance barrage or a 1.5GWe fission plant is a big lump.
@bernieecclestoned @hellothere
Renewables are viable because they produce electricity cheaper than combustion, and because combustion will be restricted and banned in various conditions as time goes on.
We used to think peak oil would be more of a problem, but previous oil is the compelling problem.