Wednesday, April 29, 2015

Renewable Power Grids Are Technically Viable and Coming Soon

By Nick Lawton, Staff Attorney

A series of recent reports have demonstrated that several jurisdictions around the world are capable of meeting energy demands with renewable energy. A growing number of jurisdictions are committing to supplying all their power with renewable energy, for both environmental and economic reasons. Renewable-based power grids are coming, and jurisdictions in the United States and around the world should use all available policy tools to ensure that the transition is swift and smooth.

Reports Show Australia and China can Develop Renewable Power Grids

Australia has excellent access to renewable resources, meaning that it could develop a great deal of renewable energy at relatively low cost. The World Wildlife Fund and the Australian National University report that Australia could develop a fully renewable power grid by 2050 at cost comparable to fossil fuel-fired options. To reach this goal, Australia would have to adopt a robust set of long-term policies aiming to promote renewable energy development. However, the current policy environment in Australia is profoundly unfriendly to renewable energy. The Australian government has been dithering over its Renewable Energy Target for more than a year, and in this uncertain political environment, investment in renewable energy in Australia is tanking. The United Nations Environment Programme (UNEP) reports that policy uncertainty caused renewable energy investment in Australia to plunge from $2.1 billion to only $330 million. Australia could reverse this trend and achieve a renewable power grid, but only if it can muster the political will.

China, meanwhile, could generate 85% of its electricity with renewable energy by 2050, according to a report by the China Renewable Energy Centre. According to Wang Zhongying, the Centre’s director, that renewable energy grid would contribute 6.2% of China’s gross domestic product and would provide 12 million jobs, in a net economic benefit for the nation. Arguing that China needs to adopt a “target-oriented approach,” the report notes that prior planning and a strong, committed policy framework will be necessary. And China is off to a good start. UNEP reports that China saw the most renewable energy investment of any single country in 2014, at $83.3 billion. That was a 39% increase from 2013. If China can sustain this level of renewable energy development, it could reach the ambitious goals of an 85% renewable energy grid by 2050.

U.S. States Will Likely Need to Be Leaders

Experts have made similar findings in the United States. The Solutions Project offers routes that U.S. states could take to reach 100% renewable energy grids.  Meanwhile, as California ponders adopting a 50% Renewable Portfolio Standard, Michael Picker, the president of the California Public Utilities Commission has noted that a 100% renewable power grid is possible. Bloomberg Business quotes Mr. Picker as stating “We could get to 100 percent renewables” and as noting that “getting to 50 percent is not really a challenge.” Similarly, in Hawaii, where legislators are considering a 100% Renewable Portfolio Standard, State Senator Mike Gabbard has stated that “100 percent is definitely doable.”

These technical findings are good news, because U.S. states will likely need to be policy leaders in bringing this nation toward a fully renewable future. Although the federal Clean Power Plan is an excellent first step toward reductions in carbon emissions, development of renewable energy is only one of four building blocks in the plan. Moreover, legal challenges run a substantial risk of delaying the plan’s implementation. Thus, state-level energy policy is likely to be critical in the near future.

The best way for U.S. states to take the lead on renewable energy development is by increasing targets in Renewable Portfolio Standards. However, many states are considering proposals to erode or repeal their renewable energy targets. Fortunately, most of those proposals fail, as one recently failed in North Carolina. Renewable Portfolio Standards have promoted economically efficient development of renewable energy. For example, a utility in Virginia has seen such low compliance costs that it is proposing to offer rebates to consumers. And utilities in Nevada have already exceeded the state’s targets. These policies work well and do not raise electricity prices beyond business as usual. U.S. states should embrace and expand Renewable Portfolio Standards.

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