We are living in a bizarre energy timeline where the cost of new energy generation capacity has never been cheaper, yet the cost of delivered energy in the US (and most of the west) has never been more expensive.
Recent project tenders in Saudi Arabia include the 1.4 GW Najran Solar PV at 1.097 cents/kWh, the 600 MW Ad Darb Solar PV at 1.36 cents/kWh and the Dawadmi Wind IPP Plant, 1.5GW at 1.34 cent/kWh.
1 cent per kWh at GW scale. This is insane.
Saudi Arabia has some of the cheapest natural gas in the world. In that same country, their natural gas power plant PPAs are coming in at 4-5 cents/kWh. The Saudi's view gas as a complement to solar and storage, not competing with it, and providing grid firming and winter/nighttime power. Their target is 50% renewables by 2030.
Not for climate change. For energy abundance.
The US has no target. No national plan to give us cheap energy that can come anywhere close to matching these numbers. Our politicians talk about energy abundance, but other countries that we look down on actually deliver it. The US is reinvesting in coal plants, despite our abundance of cheap natural gas. We are investing in new nuclear (rightfully so), but that will have no material impact on energy in the US for over a decade - this battle is happening right now.
Did I say that these costs were insane?
China is installing grid scale battery storage at $65/kWh (capex). The middle east and India are building storage for slightly over $100/kWh.
I don't expect that the US would ever be able to match the costs in these countries. These are centrally planned, government controlled and subsidized industries. But, it should not be 5x (or more) as expensive to build projects like this here. We are killing our dreams of energy abundance with byzantine regulatory and market structures, red tape, political culture wars, tariffs with relatively little corresponding domestic manufacturing incentives, and an unwillingness to invest in our public grid infrastructure (yes, we the US ratepayers have paid for all of it).
US industrial companies are trying to do the right thing by building their factories and data centers in the US. International trade partners are trying to do the right thing by building factories here as well. But, the siren song of 1 cent electricity firmed by cheap batteries and gas will ultimately prove too strong for capital to resist, and the countries that exploit this energy abundance are going to dominate us.
The last wave of offshoring took our manufacturing base with cheap labor. This wave will take it for cheap energy.
There is no fundamental reason we can't be competitive on energy costs. We have abundant natural resources to do so.