Will Clean Energy Ever Be a Reality in the U.S.? Here's What's Standing in Our Way
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Renewable energy is essential if we are to avert disastrous climate change caused by carbon-dioxide emissions from burning fossil fuels. Yet despite significant recent growth, less than 2 percent of the about 4 trillion kilowatt-hours of electricity the U.S. generates a year comes from solar or wind power. More than two-thirds still comes from coal, natural gas or oil, and 20 percent from nuclear power. Meanwhile, the world's total reserves of oil, gas, coal, and uranium are expected to run out by the end of the century, especially as electricity consumption increases.
So what are the obstacles to converting the U.S. electrical system to renewable energy? They are a mix of technological, economic and political factors.
Solar and Wind Make Gains
Solar energy has become "economically viable only in recent years," says Seth Masia, deputy editor at Solar Today, an industry trade magazine in Boulder, Colorado. Prices for photovoltaic panels--the most commonly used devices to convert sunlight to electricity--have dropped dramatically, Masia notes, as "Chinese manufacturers have flooded the market with low-cost devices."
Germany is the world leader in switching over. Early this year, the amount of its electricity that came from renewables passed 20 percent. Solar output almost doubled from the previous year; a utility trade group credited plummeting costs for solar panels and the government deciding to retain subsidies for private solar-power generation. Wind and solar sources now make up almost half of all new electricity generation in Europe, says Ken Zweibel of the GW Solar Institute at George Washington University.
In the U.S. overall, renewables have become a significant percentage of new electricity generation, although this amount fluctuates with the market. In April, California Gov. Jerry Brown signed a law requiring 33 percent of all electricity produced by utilities in the state to come from renewables by the end of 2020. Masia projects that 20 percent of U.S. electricity could come from solar power by then.
Contracts have been signed for solar-power plants with a capacity of 13 gigawatts--enough to power New York City at the record-high peak set during last July's heat wave--to come online by 2016, says Brett Prior, a senior analyst with Greentech Media in Boston. That means solar power could be 20 percent of new capacity by then, he adds.
Some plants use large arrays of photovoltaic panels. Others employ more complicated systems to concentrate solar power, such as parabolic trough mirrors that heat an oil-filled tube to 1,000°F and generate steam to spin a turbine. Most are in California and Arizona, but there are others underway in Colorado, Nevada, the Long Island suburbs of New York City, and Austin, Texas. Construction has begun on three 250-to 370-megawatt plants in Southern California deserts, but two larger ones--a 1-gigawatt plant at Blythe and a 709-megawatt one in the Imperial Valley--have been delayed for further state review, because they switched their plans from concentrated solar power to photovoltaic cells.
Texas now gets 8 percent of its electricity from wind. This is largely due to a 2005 state law that established collaboration between wind-farm developers and utilities, says Mark Kapner, a retired senior engineer in Austin Energy's renewables division. If wind developers commit to building on a site, the utilities will commit to building power lines out to it, and the cost of transmission will not increase with distance.
This is important, Kapner explains, because the strongest winds are in remote areas, such as west Texas and the rest of the Great Plains. Before the bill was passed, wind turbines had to be taken out of service sometimes, because they were generating more electricity than the existing power lines could handle.
Most people don't think of Texas as "a progressive, innovative state on energy," says Kapner, "but in reality it is." Solar's technological advances have evolved, rather than come through major breakthroughs, he says. Silicon is still the most common material used for photovoltaic devices, says Wladek Walukiewicz of Lawrence Berkeley Labs in California. It's not very efficient, he adds -- it converts 10 to 20 percent of the energy received to electricity--but it can be produced cheaply. The Chinese have been able to bring prices down by "the sheer power of mass production."
Some solar producers are opting for a newer technology called "thin-film" devices. These employ either a cadmium-telluride combination or a copper-indium-gallium-selenium alloy called "CIGS." They are not more efficient than silicon, says Walukiewicz, but can be produced cheaply and require far less space and thus fewer materials in the overall system.
Walukiewicz and other scientists at Lawrence Berkeley recently unveiled a photovoltaic device made from a mix of gallium nitride and indium nitride that gets 43 percent efficiency. The gallium compound is sensitive to light on the ultraviolet side of the spectrum, while the indium is sensitive to the infrared side, he explains, but if you mix the two, you get a device sensitive to visible light, and you can adjust the mix for different wavelengths. These elements are much more expensive than silicon, but the devices would be "much easier to make, much simpler."
A power grid based on renewable energy would most likely be a mix of individual sources, such as solar panels on rooftops and office and industrial buildings, and centralized generation by utilities. Utilities would have to adapt to decentralization, but "they'll still have a major role," says Ken Zweibel, as they would provide economies of scale and more reliable backup.
Decentralization requires that utilities allow "reverse metering," letting private users with solar panels pump the surplus electricity they generate back into the grid and thus reduce their bills. Some states mandate this.
How to store the electricity produced is still an issue. What do you do at night or on cloudy days? Solar-power advocates counter that it would eliminate the need for costly peak-power generation, because the most intense sun coincides with the heaviest use of air-conditioning. "Brownouts would go away," Masia says.
The flaw in that argument, Kapner say, is that there is still a high demand for air-conditioning after sundown. Electricity use peaks when people get home from work; in the Southwest, utilities run at 90 percent of peak demand at sundown, and one-third to half of that is for cooling. Kapner believes this problem could be resolved by better cooling systems and smarter grid management.
Concentrated solar-power systems can store the energy they produce as heat in tanks of molten salt, but photovoltaic devices have to rely on batteries, which are more expensive. Another possibility is using the electricity generated to pump water into mini-hydropower systems.
Storage is "not a big deal" now, says Brett Prior, but will become more crucial as renewables become a substantial part of electricity generation. "Dispatchability" is also an issue, he adds, as gas plants can be turned on and off quickly to meet demand, while solar and wind supplies are more intermittent.
Still, says Zweibel, current solar technology is "adequate to meet 10 to 20 percent of current energy needs, so we need to get on the ball." "I don't think there are any technical hurdles right now," says Walukiewicz. "Germany is not a very sunny place, but they are probably the biggest consumer of solar cells."
Two large economic obstacles remain: In the U.S., fossil fuels are still cheaper sources of power, and converting the nation's entire electricity-generating system would be costly and take decades.
The tipping point will be "grid parity," says Kapner, referring to when the total cost of installing and running a solar-power system becomes equal to that of buying conventional power. The equipment and installation are expensive, but after that, it costs very little. In the large systems now running in the Southwest, operating costs are as low as 1 cent per kilowatt-hour.
"You have to remember that the fuel is free," Masia says of solar, and the only maintenance needed is "you have to wash the dust and birdshit off" the panels.
Utilities are "technology-agnostic," says Prior; they "will do whatever is best for their investors and shareholders." The price of solar power from photovoltaics has come down to about 12 cents per kilowatt-hour, which is slightly less than the cost of power in New York City or Massachusetts--but twice the 6 cents that natural-gas power currently costs.
In 2009, wind made up 42 percent of all new generation capacity that came online, Prior says. The year before, the price of natural gas had reached $14 for a million British thermal units (BTUs), so utilities sought alternatives. But when gas dropped to $4 for a million BTUs in 2009, they switched back. In 2010, less than a quarter of new power came from renewables, while 35 percent came from coal and 38 percent from natural gas.
"The reason we have to subsidize is because the initial 20-year-cost is higher," says Zweibel of solar electricity. But in the long run, renewables are cheaper, says Mark Kapner. In Austin Energy's Green Choice program, he says, customers pay higher rates at first, but they don't have to pay increases for the next ten years, which protects them from the volatile prices of natural gas.
The Chinese competition has hurt U.S. solar-panel manufacturers, most notoriously the Fremont, California, firm Solyndra, which filed for bankruptcy in September after receiving more than $500 million in federal loans. When Solyndra was launched in 2007, says Masia, "no one anticipated" that the Chinese government would "invest very, very aggressively" in solar-panel manufacturing. Beijing has pumped $30 billion into it, says Zweibel.
Another issue is the time and money it would take to convert the U.S. power grid. About 3 percent of the U.S. generation infrastructure gets replaced every year, says Prior, so even if half of all new capacity were renewable, it would take until the 2040s for half the supply to come from renewables.
Globally, he says, whatever the U.S., France, and Germany do is "a drop in the bucket compared to what's being built in emerging markets." As industry expands in countries like China, India, and Indonesia, world electricity consumption is projected to rise from the 16 terawatt-years of 2009 to 28 terawatt-years in 2050.
What would it take to convert the U.S.? Prior says a combination of technological breakthroughs, cheaper solar panels, better storage, and either an increase in natural-gas prices or a carbon tax. If California's carbon tax raises the price of natural-gas power to 10 cents per kilowatt-hour, he adds, solar power will be competitive by 2014.
Paying the Price
Yet if we wait for the market to drive conversion to renewable energy, the Earth might be a scorched, drought-ridden, hurricane-battered planet by the time it happens. Power producers' bottom lines do not include what economists call "externalized" costs--the price of the environmental damage caused by pollution and carbon emissions. What to do about that is inescapably a political issue.
"I see a lot of paralysis in the U.S. on global warming. I don't see a lot of motivation to adapt," says Zweibel. "If I had my druthers, I would have massive solar and wind installations."
Some utilities are resisting efforts to switch over, especially in the Southeast, says Jim Warren, head of NC WARN, a watchdog group based in Durham, North Carolina. A 2007 state law requires 0.2 percent of electricity sold to come from solar power by 2018-but Duke Energy, the largest utility, refuses to buy more than that, he says. In June, a Duke representative told the state utilities commission that the company had already met the minimum and didn't need to do any more.
"It's not only that they won't do it themselves, they're blocking others from doing it," says Warren. "Instead of treating that carveout as a foothold, they're treating it as a cap."
"It's not difficult to do a deal with [Duke]," Richard Harkrader of Carolina Solar Energy in Durham told the CharlotteBusiness Journal in 2010. "It's impossible."
Meanwhile, Duke is putting $3 billion into building new coal and natural-gas plants. Progress Energy, the other big utility in the Southeast -- which is currently trying to merge with Duke -- is spending $2 billion on new gas plants.
Warren blames the "cost-plus" financing of regulated monopolies, in which power companies are guaranteed a return on their capital investment. "They'd rather have a nuclear-power plant cost $10 billion rather than $8 billion, if they can be sure to pass it on to their customers," he says.
State legislatures enable this, he says, by a policy called CWIP, "construction work in progress." Under this, regulators grant rate increases to cover the construction costs of nuclear plants before they come online. This protects utilities from the fate of the Long Island Lighting Company, which went out of business in 1989 after it spent $6 billion on a nuclear-power plant that never opened because it couldn't develop an adequate evacuation plan for the heavily populated island.
If the market doesn't push renewable energy fast enough, government action is the alternative, but "we don't have a national energy policy," Masia declares. "We make it easy for oil companies to import oil. We make the world safe for drilling in dangerous parts."
The Obama administration slightly increased funding for the National Renewable Energy Laboratory in Colorado, raising its budget to $536 million in fiscal 2010 after it had languished at less than half that amount for most of the Bush era. Still, its main initiative on global warming has been an unsuccessful attempt to enact a "cap and trade" system--essentially, "in exchange for being allowed to operate a coal-fired power plant in Tennessee, we'll buy a forest in Brazil and not cut it down."
Meanwhile, the Republican reaction to talk of climate change resembles children sticking their fingers in their ears and screeching "la-la-la, I can't hear you" -- whether it be Mitt Romney saying "I don't know if it's mostly caused by humans," Rick Perry contending that it's "nonsense" to jeopardize the American economy "based on scientific theory that's not settled yet," or Michele Bachmann claiming that carbon dioxide is harmless because it's "a part of Earth's life cycle." More recently, the far Right has obsessed on the Solyndra loans as outrageous examples of government incompetence and corrupt social engineering.
"We're certainly seeing no leadership from the White House, and worse from other quarters," says Warren.
In January 2009, as Barack Obama was preparing to take office, Denis Hayes, national coordinator of the first Earth Day and now head of the Bullitt Foundation, called for "a national commitment to solar and renewable energy comparable to our mobilization for World War II, when the United States unleashed its scientific creativity and its industrial power to support the war effort."
Spending $300 billion would make 50 million homes more energy-efficient and create millions of jobs, he wrote in Solar Today. If the federal government bought and installed massive amounts of photovoltaic devices, he went on, it would bring their prices down and stimulate the market the way military and space-program purchases did with computer chips. To finance this, he advocated a "cap and auction" system, which would auction off permits "where carbon fuels enter the economy" and limit total production-not "cap and trade," of which he said, "creative traders will find myriad ways to game."
More than three years later, nothing remotely close to this has happened.