Working on power2X in academia, I heard this a lot: with more RES deployment, we will have abundant clean electricity, it will cost nothing and we could do all these interesting things with it ->. A on renewable *cannibalization* and how power2X can help

Unlike fossil fuel plants, the marginal cost of operating a solar/wind asset is very low (sun, wind are free unlike gas or coal). What this means is when the sun is shining, or wind is blowing, electricity costs in the market go down. This is called the "merit order effect".

By extension, if you deploy a lot of wind and solar in a system, the price of electricity should go down drastically. So far so good. BUT

To build and operate wind and solar assets requires over its lifetime like anything else. So if the electricity unit costs keep going down because of more RES, at some point the same RES cant earn back thr costs. This is renewable cannibalization.

*More renewables prevent the deployment of renewables*. This is also why govts need subsidies in the coming years if they really care about reaching thr ambitious RES targets. The other piece of this puzzle is the electricity demand and thats where power2X comes in.

As more things get electrified like heating, transport and we develop flexible technologies such as power2X, batteries, they create higher electricity demand and form a hedge against such a cannibalization thereby improving the business case for a power system with high % of RES.

Large scale deployment of power2X will be a blessing for an electricity system with a high % of renewables. Because the electricity prices will then be *higher*. If that unit price is low enough for say H2 from power2X itself to be feasible is another question. Complex enough?