Thursday, May 5, 2011

Building for the peak

The price of electric energy is going up at an astonishing rate and all indications are that if we continue with our existing policies it will reach economy crippling levels very soon. The reasons for this are many and varied, but the government’s desire to appear to reduce emissions is the primary explanation. So-called clean technologies are expensive and nowhere near as efficient as plants that burn fossil fuels. To compound this problem the cyclical nature of electric power consumption requires the industry to build an infrastructure that will meet the needs of peak usage. Most of this infrastructure will lay fallow during off hours - pushing up the cost.

So why not find a way to make the electrical grid pay for itself 24/7? The answer of course is to use excess electricity generation capacity to produce a clean efficient portable fuel – Hydrogen. The production of hydrogen fuel would create a whole new revenue stream for the power utilities that they could use to reduce the cost of electric power. Ironically this would have the greatest effect on the efficiency of alternative electricity sources such as wind or solar power. They are notoriously difficult to attach to the power grid because of their fluctuations in output. Taking them off-line to produce hydrogen would allow them to use 100% of their output to create usable energy.

The problem is we don't have an infrastructure that can distribute and store hydrogen. So what can government do to fix this problem? It would appear obvious. They should remove the cost of government from any project that will enhance a hydrogen fuel distribution grid. They have already spent recklessly on alternative energy projects such as wind and solar power – an investment in a hydrogen infrastructure would help make that technology more cost effective. Government should aggressively encourage the expansion of hydro-electric capacity in the far north with a primary objective of producing energy that can be piped to population centers without line-loss.

A hydrogen infrastructure cannot be built over night – so a sector by sector approach would have to be adopted. Government could influence taxis and buses to burn hydrogen fuel with tax rebates and then move to a similar program for the trucking industry. This would allow the infrastructure to keep pace with growing consumption and before long many private vehicles would make the switch.

So let’s do this before we are too broke to pay our hydro bills!

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