Is the mark-up on the latest UK offshore wind CFD's 410 times the price of Natural Gas futures? UK households face a 50% increase from the offshore wind component of their electricity bills
From here:
“Net Zero Watch highlights the same. The price for new electricity from offshore wind has risen to £82/MWh in current prices, a significant 58% increase since the previous successful auction.”
That high price will be passed on to consumers.
Out of interest, here’s a back of the envelope calculation for coal, oil and gas using futures prices and a quick search of electricity converted from these hydrocarbon raw materials.
Natural Gas price – around 2 bucks for a contract with a spec of 10,000 million British thermal units (mmBtu).
Natural Gas (NG) Price Today, Forecasts & News | FX Empire
I have used 2 bucks below instead of the volatile 2.113 price.
“Specifications for a Natural Gas Futures Contract:
1. Symbol: NG (New York Mercantile Exchange)
2. Contract Size: 10,000 million British thermal units (mmBtu)
3. Pricing Unit: U.S. dollars and cents per mmBtu
4. Tick Size: $0.001 per mmBtu ($10 per contract)
Using Brave Browser’s AI, we have this:
“From 10,000 million British Thermal Units (MMBtu), approximately 8,844,500 kWh of electricity can be produced, assuming an average efficiency of 33% for a coal-fired power plant.”
You can get 8,845 mWh for 2 bucks using natural gas = around 1 pound sixty pence.
Which works out at less than 20 pence per mWh!
There has to be something wrong with the arithmetic!?! Surely the mark up of offshore wind compared to natural gas is not 82 pounds (8,200 pence) divided by 20 pence = 410 times!!!
Even multiplying by a thousand times, results in just 18 pence per mWh, compared to the price of wind of 82 pounds per mWh – a mark up of 45 times for offshore wind v natural gas!
Here’s the full Brave browser AI logic:
1 “Electricity Generation from 10,000 MMBTU
To determine the electricity production from 10,000 million British Thermal Units (MMBtu), we need to convert MMBtu to a more suitable energy unit. According to the International Steam Table Conferences, 1 MMBtu is equivalent to approximately 10,550,600,000 Joules (J).
Efficiency of Power Plants
The efficiency of power plants varies depending on the type of fuel and technology used. For this calculation, let’s assume an average efficiency of 33% for a coal-fired power plant, as mentioned in one of the search results (10,500 Btu/kWh).
Electricity Production
Using the converted energy value (10,550,600,000 J) and the power plant efficiency (33%), we can estimate the electricity production:
1. Convert Joules to Kilowatt-hours (kWh): 10,550,600,000 J ≈ 2,931,500 kWh (using 1 kWh = 3,600,000 J)
2. Calculate electricity production based on the assumed power plant efficiency: 2,931,500 kWh ≈ 8,844,500 kWh (accounting for 33% efficiency)
Result
From 10,000 million British Thermal Units (MMBtu), approximately 8,844,500 kWh of electricity can be produced, assuming an average efficiency of 33% for a coal-fired power plant.
Note that this calculation is an estimate and actual electricity production may vary depending on various factors, such as the specific power plant design, operating conditions, and fuel quality.”
Onwards!!!
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Gas powered thermal plants can increase efficiency by spending money on “bottom cycling”. Long ago I was shown plans for a PW turbine engine plant to be located in a remote area where fuel cost was high. The engine used water injection to lower temperature and increase power density to the point the engine was delivering 3x the power of the aircraft version. The steam was expanded over several turbines and the heat scavenging was so intense the final exhaust had to be extracted from a tower with an electric fan. I think the exhaust was 27 degC above ambient. Such technology was historically used where it made business sense. Notice the last two words.
so we are built on coal and gas, China is opening a coal mine per month-so we use irreplaceable cobalt ,lithium and copper and huge quantities of energy to build ineffective and inefficient wind turbines, solar panels and electric car batteries. And kill cows. Please can someone tell me why? Don't answer to save the planet--this destroys the planet.