Gas peakers stranded assets by 2030

Source: Vox -- Clean energy is catching up to natural gas.The natural gas “bridge” to sustainability may be shorter than expected.

From IEEFA:

Europe’s power system will look very different in 2030, with energy storage supporting the “dominance” of wind and solar generation, according to new research from Wood Mackenzie.

The big five European markets—Germany, the U.K., France, Italy and Spain—will get the majority of their power from wind, solar and other variable renewable energy sources as early as 2023, WoodMac says. By 2040, Europe is expected to add another 169 gigawatts of wind and 172 gigawatts of solar.

As that variable output surges, Europe has four options for balancing out its grid: pumped hydro, gas peakers, energy storage and interconnectors. Only the final three of the quartet are likely to be the focus of new investment.

For now, “gas peakers are more essential than ever,” said Rory McCarthy, Wood Mackenzie principal analyst. “They can ramp up to full output from warm in a couple of minutes for modern systems, have increasing efficiency levels at part loading and boast unlimited duration, assuming a reliable gas supply.”

But by the end of the decade, battery storage will be the cheapest option for balancing Europe’s grid, overtaking gas peakers, according to a new long-term energy storage outlook. Europe’s energy storage capacity across all segments is expected to grow from 3 gigawatts today (excluding pumped hydro) to 26 gigawatts in 2030—and 89 gigawatts by 2040.

“By 2030 energy storage will beat gas peakers on cost across all our target markets, resulting in a cloudy outlook for any new future peaking turbines,” McCarthy said. “Fuel and carbon prices are on the up, technology costs are not set for any major decreases and net-zero policies will eventually target the decarbonization of all power market services.”

The moral of the story:  we should keep existing gas power stations whle we wait for battery prices to fall even further, but not build new ones.  Unless we use synthetic natural gas, or green methane, produced via the Sabatier process using green hydrogen made from electrolysing water using renewable electricity.  And perhaps not even then.