Is a Future With High Renewable Electricity Production Really Possible?

There continues to be a large amount of skepticism as to whether or not a promising renewable electricity future exists using solar and wind generation. Peter Bronski, with Rocky Mountain Institute, explains why the future is indeed promising and highlights the progress that has already been made in the field.
By Peter Bronski
June 06, 2013
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The 'Renewable Electricity Futures Study' points to an 80-plus percent renewables future, in which 60 percent of electricity generation comes from wind and solar; hydro provides about 12 percent, with biomass and geothermal making up the remainder.
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Reposted with permission from Rocky Mountain Institute.

In recent weeks and months, there’s been much to celebrate about renewable energy and the electricity system—wind and solar in particular are continually breaking records for installed capacity and actual generation. But amidst the celebratory fanfare there’s also been an undercurrent of skepticism—skepticism that a high renewables future could be here soon, or is even possible at all.

Last month the Washington Post ran a skeptical opinion piece by Matthew Stepp, senior policy analyst at the Information Technology & Innovation Foundation. One month earlier, another skeptical article called renewables a “pipe dream.” Last year IEEE published “A Skeptic Looks at Alternative Energy,” which chastised the renewables movement for “wishful thinking” and suggested that a high renewables future for our electricity system, if it comes, is generations—not decades—away.

Such skeptics often point to a number of familiar criticisms: that high penetrations of renewables are not possible; that such a future requires major technological innovation; that it requires unreasonable amounts of energy storage to balance variable wind and solar; that it requires massive build-out of transmission infrastructure, biomass generation capacity, large-scale hydro, or all of the above; that it requires major investment that simply isn’t there; that it is uncompetitively costly (at least without large subsidies); that variable renewables will undermine the reliability of grid power.

Couple such skepticism with IEA’s recent report noting that renewables have yet to make a serious dent in the carbon intensity of the global energy system—on which fossil fuels seem to have a strangle hold—and it’d be easy to side with the skeptics, but they are wrong.

Renewables’ track record shows that they continue to outpace skeptics’ expectations. “People thought that maybe renewables would get to two percent. When they did that, people said maybe five percent. Then 10 percent,” says Hutch Hutchinson, managing director at RMI. “Renewables have been fighting and scratching the entire way. Now, there’s good analytical evidence that with some creativity and customary levels of reinvestment in our energy system, we can get to a high renewables future.”

Eric Martinot, author of REN21’s Renewables Global Futures Report 2013, said something strikingly similar during a recent visit to RMI’s offices. He noted that the World Bank and others typically have a view of renewables that’s either behind the times by a decade (their image of 2013 is what renewables actually looked like in 2003) or low by a factor of ten (they think there’s much less renewable capacity than there really is).

But if we look to a growing body of consensus among energy futures studies and to an increasing number of examples from around the world today, we’ll see that a high renewables future is both possible and capable of coming soon. Indeed, in some places it’s already here.

The Prospect of a High Renewables Future

United States

For the United States, perhaps the most-cited work about the prospect of a high renewables future is the National Renewable Energy Laboratory’s Renewable Electricity Futures Study. It points to an 80-plus-percent renewables future, in which 60 percent of electricity generation comes from wind and solar; hydro provides about 12 percent, with biomass and geothermal making up the remainder. Importantly, the NREL study found “no insurmountable long-term constraints” and that the cost of required transmission build-out would be within the recent historical range for average annual transmission and interconnection investments of investor-owned utilities. Additionally, NREL noted that such a future would dynamically find its own viable end state given the diversity of technologies and the abundance of renewable sources from which to compose solutions. For example, if currently less mature technology such as offshore wind or concentrating solar power progresses slowly, existing more mature technologies such as onshore wind would take its place; similarly, if transmission build-out fell short, distributed generation could be developed closer to load centers.

High renewables systems can achieve all of this while maintaining grid reliability. For example, Synapse Energy Economics’ 2013 study for the Civil Society Institute, Meeting Load with a Resource Mix Beyond Business as Usual, found that the U.S. grid could integrate and balance many times the current rates of renewables hour by hour, season by season, with no additional reliability issues.

Rocky Mountain Institute’s own 2011 analysis, Reinventing Fire, similarly highlighted how the U.S. could be powered by 80 percent renewables in the future, largely through wind and solar with smaller contributions from energy storage, hydro, biomass, and geothermal. RMI explored two very different paths for achieving 80 percent renewables: one closely parallel to NREL’s study and another that shifted the portfolio of renewables toward a greater share of distributed resources, such as solar PV, efficiency, demand response, and electric vehicle integration. “Most of the analytical studies of high renewables futures have leaned toward large-scale renewables instead of distributed resources,” says James Newcomb, program director at RMI. “It’s critically important to explore the potential role of distributed resources as well, so that we can identify trade-offs between the two in terms of cost, resilience, and reliability.”

Both the NREL and Reinventing Fire high renewables futures show only modest amounts of energy storage—often cited by critics as a major stumbling block—and use a variety of already-available strategies for balancing large shares of variable renewables. For example, both ERCOT of the Texas Interconnection and PJM of the Eastern Interconnection employ robust amounts of demand response, ERCOT to help meet its regulatory reserve. Demand response behaves just like a variable power plant, but is much cheaper, and allows balancing renewables by adjusting customer loads that don’t require operating at specific times of day.

Much of the initial investment necessary to pave the way for high renewable futures is already happening and accelerating, both in the U.S. and globally. According to REN21’s renewables futures report, global investment in renewable energy reached $260–$290 billion in 2011, up from just $40 billion in 2004. Investment in renewable energy last year was more than the world invested in fossil-fueled and nuclear generation combined, according to Martinot. Renewable energy now enjoys the majority of power generation investment globally, and such investment is only expected to grow. Through 2020 to 2030, Bloomberg New Energy Finance estimates renewable energy investment will reach $400–$460 billion. Many others predict $500 billion by 2020, and some estimates suggest as high as $1 trillion annually.

International

Europe-focused studies have come to parallel conclusions. The Stockholm Environment Institute’s Europe’s Share of the Climate Challenge points to 75 percent renewables by 2030, with even more by 2050. The European Commission, in its Energy Roadmap 2050, shows that renewables could comprise nearly 50 percent of electricity generation under a current policy initiatives scenario, more than 64 percent under a high energy efficiency scenario, and as much as 97 percent of power consumption under a high renewables scenario. Meanwhile, the European Renewable Energy Council’s RE-thinking 2050 takes renewables to their fullest extent—100 percent, with wind and solar together accounting for 60-plus percent of electricity consumption.

Global scenarios, too, show the potential for a high renewables future. Greenpeace’s Energy [R]evolution 2012 report points to 94 percent of global electricity from renewables, with 60 percent from “new” renewables, especially wind and solar. The Energy Report, a joint product of WWF and Ecofys, similarly points to a 100-percent renewable electricity future, also with roughly 60 percent from wind and solar.

It’s not especially surprising that nonprofit environmental groups such as Greenpeace and WWF highlight pathways to high renewables, but more conservative sources also note the viability of such a future. For example, Global Energy Assessment – Toward a Sustainable Future (Cambridge University Press) found renewables could supply up to 75 percent of global primary energy use (up to 100 percent in select regions) with renewables providing up to 62 percent of electricity. Further, the 2DS scenario of the International Energy Agency’s Energy Technology Perspectives 2012 shows that renewables could comprise 57–71 percent of electricity generation.

These scenarios converge, not just on the technical viability of a high renewables future, but the economic viability as well. While the IEA notes that government support for clean energy RD&D has fallen from 12 percent in 1980 (20 percent among IEA member countries) to under 4 percent in 2010, recall REN21’s observation of the accelerating investment in renewables, including large pools of private capital. Further, IEA’s 2DS scenario notes that between 2025 and 2050, investments in clean energy would more than pay for themselves via avoided fossil fuel costs and other factors, resulting in $100–$150 trillion savings on fuel and $5 trillion in net savings. The Greenpeace report likewise notes a $52 trillion fuel cost savings through 2050, more than double the predicted total investments needed to reach a high renewables future state. (On the topic of transmission build-out in particular, studies largely agree that it could happen for “costs projected to be affordable,” similar to NREL’s conclusions.)

“Renewable energy futures are no longer a matter of technology—we have all the technologies we need—and are no longer a matter of economics either,” says REN21’s Martinot. “We’re just not making the cost comparisons in the right way. It’s our way of thinking and our power industry structure that makes renewable energy seem more expensive, not the technology itself.” That power industry structure includes hefty and durable fossil fuel subsidies, which amount to $1.9 trillion per year or more, according to a report from the International Monetary Fund earlier this year. Those fossil fuel subsidies far outweighed the smaller and more transient subsidies offered to renewables, according to the International Energy Agency’s World Energy Outlook 2012.

 


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