Plus storage

When I comment on just how cheap renewables are relative to coal and nuclear, critics rightly point out that renewables are variable, and that you have to add the cost of storage to the underlying cost of the renewables infrastructure.  So that's what I've done, in the chart below.

Some points:

• Historical data taken from Lazard; forecasts assume that the average declines over the last 5 years continue for the next 3, except for fossil fuels, where no change is assumed
• Wind + solar represents 50-50 split between wind and solar, which minimises storage needs because of the negative correlation between wind and solar and because demand is higher in the daytime when solar is abundant.
• These data are for the USA; gas is much more expensive outside the USA than in it.  In Australia, for example, combined cycle gas is more expensive than coal.
• The storage costs are based on BNEF's annual battery pack survey, assuming 15 year life, no inverter/transformer costs and no permitting, or construction costs, and 100% daily depth of discharge.  However, with 24 hours of storage, DoD would rarely reach 100%, so in reality costs would be higher.  On the other hand, 6 hours of storage would likely be fully used daily.  The additional storage needed to get to 100% renewables should be compared with the cost of peaking gas plants which are 3-4 times as expensive as gas combined cycle used for baseload.  I don't have estimates for how much extra the inverter and concrete base would add (20%?), but if the batteries are installed at an existing wind/solar farm, additional costs will be limited.
• Studies have shown that around 24 hours of storage would be enough for Australia with 100% renewables.  US studies have suggested higher amounts would be needed.  However, both analyses assume no other power source, including e.g. hydro.  
• The chart is plotted on a logarithmic scale, which means that if two lines are parallel, they have the same growth rate/rate of decline.  The gap, on a log scale, between wind+solar and wind+solar+storage is not that variable.  Right now, solar and batteries are falling faster in cost than wind power.
• Wind+solar+24 hours of storage became cheaper than coal in 2016, and will be cheaper than gas (in the USA) this year.  The gaps just get wider from now on.
• Wind+solar+6 hours of storage is now cheaper than coal and gas.  This is confirmed by new PPAs which have wind or solar plus 4 hours of storage gaining market share from gas and coal in the USA.  6 hours of storage is enough to achieve 90% renewables.
• To get to 100%, absent hydro, power-to-gas will prolly be essential.  However, as the costs of renewables fall, its cost will also decline.

So, yep, adding storage adds to costs.  But even with the added storage, wind and solar are still cheaper than coal and gas at 6 hours of storage, which is all we need to get to 90% renewables.  By the time we get there, storage costs will have fallen so much that 24 hours of storage will cost what 6 hours does now.  

There are no technical, technological or economic reasons why we can't go to 100% renewables by 2040.  Or earlier.