UK AR7 auction results are out today 🍃⚡
Excellent results with over 8 GW of capacity!
The strike price of £91/MWh for England/Wales fixed projects was significantly below the administrative strike price of £113/MWh that so many reported on last year, but was always the upper limit.
Does this SMR have a CFD/ pricing framework for the output ?
I want to come back properly on this Economist piece that questions Britain's approach to net zero.
It gets three things wrong imo:
1. Ignoring periods of v cheap renewable energy
2. Misdiagnosing the relative costs of renewables
3. Looking backwards, not forwards.
Large chunk of the world won’t care about oil embargoes very soon
Solar panels from $0.1/w ..
Versus a cost in London of £2.50 per cubic metre or $3.40. I find this extraordinary
I see that Hannah Daly concurs with your numbers so that’s about 4c cubic metre
Understood!
I don’t follow the maths .. if it takes 3KWh to make a cubic metre and it costs say $1.3 cents per kWh surely it would cost 1.3x3 or 3.9c cubic metre not $0.30 cubic metre ? Or did you mean 30Kwh per cubic metre ?
This of course is a feature not a bug of open markets
I think a big reason prices are so low in SA is that, while the costs of solar and BESS are falling yearly, Chinese manufacturers are also just undercutting everyone else in open/no tariff markets—see the two SA BESS systems that were priced at ~72/kWh: www.linkedin.com/posts/mlkubi...
Saudi Arabia is installing solar for 1.4 cents per kWh and is on pace for a 50% renewables electricity grid by 2030
In CT our standard offer rate is 9.7 cents per kWh for supply. Obviously we aren't a desert but it seems pretty feasible we can do a lot better than Natural Gas Ned is planning for
Sunny deals: Solar prices shine! #finsky
Desalination seems to currently use about 3 kWH per cubic meter, so at these prices, the water needed to grow a pound of almonds would cost you around $0.30
At these levels we are within the envelope in which SA can have plentiful supplies of water from desalination at v low prices and it can probably manufacture synthetic (and renewable) fuels that can store energy for use in other areas at prices that are lower than the cost of oil or gas today.
Just take a look at the prices at which these deals cleared.. these are obviously for intermittent solar (without batteries) but all the same they represent interesting benchmarks for public procurement of solar power in sunny places
Yesterday the Saudi Government’s Renewables procurement body signed 7 agreements for PPAs with ACWA relating to 15 GW of solar power, the largest single deal that has been signed to date and significantly boosting the Kingdom’s plans to decarbonise its electricity grid by 2030.
on.ft.com/4eSvrYa
Sorry to wade into the air con wars again, but... I spoke to @jim.londoncentric.media last week about why more homes in London don't have air con.
The bottom line is: air con in Britain is almost always a heat pump, and heat pumps are good for the climate
www.londoncentric.media/p/why-london...
“The UK’s sea level is rising faster than the global average and at an accelerating rate… Sea levels have risen by 13.4cm in the UK since 1993, compared with a global average of 10.6cm, according to the annual state of the UK climate report published on Monday.”
on.ft.com/4lzrgmM
“..the unlevered after-tax IRRs of TEF .gas.. power projects have unlevered after-tax IRRs of 3%-28%, a sharp drop from pre-2025 levels as capital costs have surged by as much as threefold.“
www.enverus.com/newsroom/str...
Isn’t the problem that trees sequester carbon only for a period - as long as they live, after which the carbon is released back into the environment as they decay. The conditions under which the coal, oil and gas reserves were laid down in the distant past no longer exist.
"In a ... hint of past financial turmoil, mortgage defaults begin to rise, along with ... credit card delinquencies. But this time, it’s different. Unlike other financial disasters, the underlying cause of this one is not financial, it is physical, and it is not clear how it will ever end."
on.ft.com/3Tdrfbx
More today
Insurance needs $1tn from private equity to close gaps, says Aon chief
It’s a theory of course. But it’s plausible because the market is a discounting mechanism and long term costs of climate change translate into short term costs for corporates and societies through among other things the insurance markets.
This isn’t just a US issue but the US housing market is a huge cog in the wheels of global financial stability.
“If insurance is no longer available, other financial services become unavailable too,” he wrote in a LinkedIn post... “The economic value of entire regions — coastal, arid, wildfire-prone — will begin to vanish from financial ledgers,” he added. “Markets will reprice, rapidly and brutally.”
Clark notes “Günther Thallinger, a management board member at Germany’s insurance giant Allianz, warned global temperatures were fast approaching levels where insurers would no longer be able to operate, creating “a systemic risk that threatens the very foundation of the financial sector”.
When Buffet said in Feb 2025 that property cover prices had gone up, he added “Climate change may have been announcing its arrival,” he said. “Someday, any day, a truly staggering insurance loss will occur — and there is no guarantee that there will be only one per annum.” .”
