How Much Is One Willing To Pay To Go Green? Natural Gas Utility ($1.5 Million/MW) Vs Solar ($6 Million/MW)

Back on June 1, 2013, I posted the following regarding the cost of putting up a new wind farm:

Off-shore, wind is, they say, more expensive. How much more expensive?

Cape Wind, off Massachusetts: $2.6 billion / 454 MW = $6 million/MW.

The London Array, phase I: 2.2 billion euros/630 MW (1 euro = $1.30); therefore, $2.86 billion/630 MW = $4.5 million/MW 

So, this is is what we have:

• North Dakota: $3 million/MW.
• On-shore average, wiki: $1 million/MW
• Off-shore, London (England): $4.5 million/MW
• Off-shore, Massachusetts: $6 million/MW

I don't know, but I assume solar is in the same ball park.

It is my understanding that a new power plant using coal/natural gas is in the ball park of $1.5 million/MW.

So, let's summarize:

Electric utility power plants:

• Coal/natural gas power plants: $1.5 million/MW
• Wind, on-shore, North Dakota, $3 million/MW 
• Wind, off-shore, $5 million/MW
• Solar, $3 million/MW (estimate)

Hold that thought (or hold those numbers).

Yahoo!Finance is reporting:

Canadian Solar Inc. (one of the world's largest solar power companies, today announced that its subsidiary, Canadian Solar Solutions Inc., has entered into a sales agreement with Concord Pacific's green energy affiliate, Concord Green Energy, whereby Concord will acquire from Canadian Solar five utility-scale solar power plants totaling 49MW valued at over $277 million.

So, now we know the price companies are willing to pay for solar energy: $277 million/49MW = $5.65 million/MW. And this is a very small transaction -- five plants totaling just less than 50 MW.

So, in the future, if I'm asked, my answer, in a 30-second sound bite will be:

• Coal/natural gas power plants: $1.5 million/MW
• Wind, on-shore, North Dakota, $3 million/MW (large projects, price comes down)
• Wind, off-shore, $5 million/MW
• Solar, $6 million

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But the Canadians are not alone in their willingness to go green whatever the cost.

The Scots are legendary about watching their money; and it's well deserved. I saw it first hand while stationed in northern England some years ago. So it was with interest that I read this article from CarpeDiem sent to me by Don:

The unreliability of wind power could mean an independent Scotland would have to import energy from England – leaving it with the highest household bills in the world, it was claimed yesterday. 

In an interview with Scotland on Sunday, Sir Donald Miller, former chairman of both the South of Scotland Electricity Board and of ScottishPower, has described the SNP’s current energy policy on producing 100 per cent of Scotland’s needs from renewables as “disastrous."

Sir Donald said an independent Scotland could find itself in the same position as Denmark, which produces much of its energy from wind and has the highest household bills in the world – about 
70 per cent more than the UK – because it has to import at premium prices from Norway when the wind is not blowing.

Denmark currently produces about 30 per cent of its needs from renewables and plans 
to increase this by 50 per cent by 2020, just half the Scottish target of 100 per cent. Sir Donald said: “Independence with present energy policies would be disastrous for Scotland. It would be even worse than the Denmark situation.”

I've lost the bubbly on whether the average Brit pays 2x, 3x, or 4x what the average Texan pays, but whatever it is, it's exorbitant, comparatively speaking. Denmark pays almost twice what the Brits pay, and the Scots are so infatuated with renewables they may outspend Denmark.

Note: Denmark currently produces about 30 percent of its needs from renewables; Scotland wants to go the full Monty -- 100%. Meanwhile, Minnesota will only settle for 25% by 2025.

All I can say: I hope North Dakota legislators watch this all play out before committing to something crazy.