Amidst all the disheartening and depressing news about global warming and climate change, renewable energy sources offer us the beacon of hope for the future.
The share of non-hydro renewables in power generation in the US has grown from a measly figure of less than one percent in 2005 to 12.5% by the end of 2020. That definitely gives us something to be optimistic about.
But not everyone is on board. Naysayers and cynics lay out a range of arguments against up-and-coming renewables like solar and wind. And, the motives and rationales behind such arguments are not hard to see either.
As long as solar and wind power remained minor players in the powerful and monopolistic energy market, all was well. However, once it became evident that they were emerging as real players, the mud-slinging began without fail.
The anti-renewable arguments put forth by the fossil fuel lobby range from intermittency and lack of aesthetic appeal to its prohibitive cost and reliance on government subsidies. And the political clout of the established players in the energy sector is making the road ahead harder for renewables.
The question here is whether more players should be welcomed into the energy market and allow it to be guided by market forces. Whether a competitive energy market is the best choice for consumers as well as the environment.
This article is an attempt at getting to the bottom of the arguments advanced by existing players of the energy industry against renewable energy. Read on to learn some truths about this renewable energy debate.
Why is renewable energy facing opposition?
As an energy consumer, you may have come across many articles offering arguments for renewable energy and promoting solar and wind energy. When you look around you, especially if you live in a pro-renewable state like California or Texas, you may see new solar and wind home installations coming up.
On one hand, you read about the amazing benefits of going solar. And this includes the environment and your wallet. On the other hand, you read and hear about how unfeasible clean energy is and how it is ill-equipped to take over the mantle from fossil fuel energy.
If you put these arguments side-by-side, it certainly doesn’t gel. So, what is going on?
6 stumbling blocks on the path of renewable energy
Until now, alternative energy sources have done an incredible job to become a notable player in the energy market. Their ability to reduce greenhouse gas emissions and pollution levels have been impressive. Competing with established energy sources like coal, natural gas, and nuclear energy is no child’s play.
However, the road ahead is not an easy one for renewables. With the competitors upping the ante, there are some major obstacles for them to overcome.
Some of these obstacles are usual for any new technology trying to make a mark in a well-established market. But some others are either artificially created or the outcome of a biased regulatory system and marketplace.
Here are some of the major challenges before renewable energy sources like solar and wind power.
1. High investment cost
One of the loudest arguments against renewable energy is cost, specifically capital cost or cost of installation.
As per the joint report by the International Energy Agency and the OECD Nuclear Energy Agency titled “Projected Costs of Generating Electricity 2020”, the utility-scale power generation costs for various technologies for the US are:
- Coal – $110 /MWh
- Natural gas – $45/MWH
- Nuclear – $71/MWh
- Onshore wind – $39/MWH
- Offshore wind – $66/MWh
- Solar – $44/MWh
This data is enough to bust the myth that solar and wind installations cost higher than coal, natural gas, or nuclear energy. However, the fact remains that construction costs are high for power plants and being a new player, renewables are viewed as risky investments by financial institutions. This typically drives up the lending rate, thus making it harder for new renewable power plants.
A point to note here is the fuel for renewable power plants comes free of cost. However, this is not a huge factor for utility-scale plants as the cost of fuel is passed on to the consumer. This takes away the risk associated with the capital cost of non-renewable power plants.
On the other hand, when the cost over lifespan or levelized cost is considered for various energy sources, renewables win the race hands down.
- Wind – $30-60/MWH
- Solar – $43-53/MWh
- Natural gas – $42-78/MWh
- Coal – $60-143/MWH
- Nuclear – $112-183/MWh
The cost of a solar home system is bound to be higher. For a consumer, the cost of solar energy is in the range of 6-8 cents per kWh, while the average utility rate is 13 cents per kWh. And, the utility rates are forever going up and the cost of solar energy is consistently coming down with the development of newer technologies.
2. Reliability
Another point renewable detractors constantly harp on is its intermittent availability and consequent unreliability. The argument is that the sun and wind are not available 24×7 like coal, nuclear, or natural gas, which makes it easier for them to raise their production as demand goes up.
Though this argument may seem believable for a layperson, if you are willing to dig deeper, you will understand that solar and wind are pretty much predictable if their availability is considered across a larger geographical area and when coupled with complementary energy sources.
The latest smart grid technologies such as real-time pricing, advanced batteries, and smart appliances can help integrate solar and wind power into a well-functioning grid.
The best example of this is California, a state with one of the highest concentrations of renewable installations. Repeated tests conducted here validate the above theory that the addition of solar and wind power can increase grid reliability.
In the case of a home installation, having a sufficient battery backup or net metering arrangement can ensure 24×7 power for the household.
3. Inability to meet all needs
An offshoot of the unreliability argument, some argue that alternative energy sources cannot meet all our energy needs. The argument is that when the sun is down and the wind is not blowing, renewable energy power plants sit idle, while base-load producers (coal and nuclear) fill in the gap.
Another point raised by renewable opponents is that the traditional base-load providers take a long time to switch on and off power generation. This means even during peak production of renewable energy, these plants are kept running to ensure they can step in whenever necessary.
Still another issue pointed out is that renewable energy on its own won’t be able to handle the energy demands of industries.
Most of the above arguments may have been true a few decades back, but the advancements in technology have helped them in overcoming these hurdles. Europe is way ahead in the renewable energy scene with countries like Denmark setting an ambitious target of replacing fossil fuels with renewable energy completely by 2035. Australia is another pioneer in the renewable energy sector, has proved conclusively that renewable energy plants are capable of handling the energy demands of industries.
4. Additional investment necessary to create backup options
This is another consequence of the unreliability of renewables as pointed out by its detractors. They argue that as renewable energy alone cannot handle 100% demands of the grid, backup power is unavoidable so they can step in when renewables are not available.
The need for backup power is indeed unavoidable to ensure the reliability of grid power. This is true irrespective of the presence of renewables in the mix. As energy storage is still not a viable option in large-scale commercial power generation, the energy demands are met by more or less on-the-spot supply.
Energy demands vary vastly across the day and over the year. To ensure an uninterrupted power supply, the energy market needs to have enough capacity to meet the peak load. This means that at other times of the day or the year, some of the generation capacity will remain idle.
This happens because of the fluctuations in energy demand and not as a result of the unreliability of solar and wind power. Even before the entry of renewable energy, this was the case and this cannot be avoided without energy storage options.
5. Subsidies for renewable energy
Currently, in a bid to promote clean energy, governments at various levels are offering numerous financial incentives including federal tax credit or Investment Tax Credit (ITC) and Production Tax Credit (PTC). While these two lucrative incentives are being phased out in the coming years, other incentives from states and local governments will continue to be available to make renewable energy more affordable.
The subsidies indeed help in bringing down the rate of renewable energy. Subsidies form only one factor in making renewables more affordable. The innovations and improvements in technologies play a prominent role in bringing down the cost of clean energy installations. In the past decade alone, the price difference has been phenomenal.
This means that even without subsidies, renewable energy rates are coming down. And, subsidies are given for other energy sources as well including fossil fuels. For 2020, unconfirmed reports suggest that fossil fuels received $5.9 trillion in subsidies. Moreover, there is no valid reason to assume that subsidizing renewables will pose problems for the stability of the grid.
6. Unequal playing field
Last, but not least is the uphill task faced by new technology in a well-established market. The power wielded by established players in the energy sector is too immense to be ignored. With so much at stake including the enormous amounts of investment in R&D, mining, drilling, and power generation through subsidies, political influence is tilting the balance in favor of fossil fuels.
The growing popularity of renewables is naturally making the fossil fuel industry nervous. Disinformation campaigns about climate change and global warming and downplaying the benefits of the renewable energy sources themselves are tactics used by them to spread false narratives. This is nothing new; this has been going on since the 1970s when the first reports about the harmful effects of burning fossil fuels became known to the world.
Bottom line
A well-designed energy market can decide on its own how to diversify energy sources and is fully capable of delivering reliable and affordable energy. Instead of blaming renewables for the instability and unreliability of energy production, more emphasis needs to be given to improving the market design. With or without subsidies, things will fall into place naturally.
Meanwhile, it doesn’t serve any purpose in demonizing any energy source. We need to recognize that each one of them has a role to play in the smooth functioning of the entire energy generation sector.
Amidst all this uproar, it is easy to lose sight of the bigger picture. More awareness, an unbiased mindset, and willingness to see beyond narrow perspectives to recognize the long-term benefits of renewable energy is the need of the hour.
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