Combined policies of R&D and deployment will be needed to break through institutional and cost barriers
Of the approximate 300 GW of new electricity generating capacity added globally over the two year period from 2008 to 2009, 140 GW came from RE [Renewable Energy] additions
According to a new Special Report from the IPCC looking at over 160 scenarios, we could get 77% of our global energy from renewables by 2050, thus reducing carbon emissions by 560 gigatons and putting us on a path to stabilize emissions at 450 ppm. The finding isn’t really new, but carries considerable weight coming from the Intergovernmental Panel on Climate Change.
The IPCC report documents the rapid rise of renewable energy in recent years — and makes clear that the future is even brighter if we combine the right set of policies. That means we mustn’t make the mistake of thinking that research and development alone can get us down the cost curve and into the marketplace fast enough to stabilize greenhouse gas emissions fast enough to avert multiple simultaneous catastrophes.
As the report concludes (emphasis in original):
Public research and development (R&D) investments in RE technologies are most effective when complemented by other policy instruments, particularly deployment policies that simultaneously enhance demand for new technologies. Together, R&D and deployment policies create a positive feedback cycle, inducing private sector investment. Enacting deployment policies early in the development of a given technology can accelerate learning by inducing private R&D, which in turn further reduces costs and provides additional incentives for using the technology
A number of studies from researchers and advocacy organizations have shown that, at least theoretically, we could get almost 100% of our energy from renewable resources. But when theory meets reality, the challenges really come to the fore.
The good news: The large team of international researchers found that renewables be scaled without a great degree of technical trouble:
“There are few, if any, fundamental technological limits to integrating a portfolio of RE technologies to meet a majority share of total energy demand in locations where suitable RE resources exist or can be supplied.”
But these technologies are not deployed in a vacuum. Project deployment depends on a number of variables that will increase or limit the potential of renewables:
“The actual rate of integration and the resulting shares of RE will be influenced by factors, such as costs, policies, environmental issues and social aspects.”
Well, that’s a no brainer. But how significant are those challenges?
Financially, the IPCC reports that we’ll need to see $5 trillion in global investment in R&D, project development and new infrastructure over the next decade. And from 2020 to 2030, that investment will need to increase to $7 trillion. Considering that the current global investment record is $150 billion, that figure will need to increase many fold in order to get close to the IPCC’s ambitious target. The World Economic Forum suggests we’ll need to invest more than $500 billion per year through 2030 in order to keep CO2 emissions to 450 ppm.
Of course, delay is even more expensive. In releasing its 2009 Energy Outloook, the executive director of the International Energy Agency said, “The message is simple and stark: if the world continues on the basis of today’s energy and climate policies, the consequences of climate change will be severe.” They explained, “we need to act urgently and now. Every year of delay adds an extra USD 500 billion to the investment needed between 2010 and 2030 in the energy sector”.
And the most expensive thing we could do is nothing at all (see Scientists find “net present value of climate change impacts” of $1240 TRILLION on current emissions path, making mitigation to under 450 ppm a must).
The political challenges (especially here in the U.S.) are also a major barrier – and depending on the stability of policies in place, will determine how much private capital is deployed to renewables. According to last year’s Global Renewables Status report from REN 21, there are over 85 countries with some sort of renewable energy promotion policy in place. That’s up from 45 countries in 2005. However, due to the changing economics of renewable energy (particularly solar PV ) and the impact of government debt crises, many countries are having to re-evaluate their policies, causing boom-and-bust cycles for project development. Determining the most effective policies that reduce government debt burdens, limit the cost to ratepayers and create simplicity in the market is still an evolving concept – and, as outlined by the IPCC report, will vary depending on the region, country or locality.
As the researchers report put it:
“The flexibility to adjust as technologies, markets and other factors evolve is important. The details of design and implementation are critical in determining the effectiveness and efficiency of a policy. Policy frameworks that are transparent and sustained can reduce investment risks and facilitate deployment of RE and the evolution of low-cost applications.”
The infrastructure challenges – building transmission lines, manufacturing facilities, pipelines, refineries and decommissioning existing conventional energy assets to integrate new projects – will be another barrier to development. This inevitably comes back to good policy: A price on carbon, manufacturing incentives, interconnection standards, and the like.
Finally, this report shows once again that it is possible to meet our current energy and climate challenges with existing renewable energy technologies. But the institutional barriers in policy, the financial markets and infrastructure development will determine how realistic that scenario truly is.
– Joseph Romm and Stephen Lacey
JR note: The IPCC finds that in the 450 ppm cases, wind could be about two wedges and solar (PV and CSP) could be twice that by 2050 (if I’m reading their charts and doing my math right), which is roughly what I said in “The full global warming solution: How the world can stabilize at 350 to 450 ppm“). They are considerably more bullish than I am on bioenergy, and I tend to think the jury is still out just how much biomass (and biochar) can contribute.