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What are the biggest obstacles to getting renewables to market?

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H. Sterling Burnett
Senior Fellow, National Center for Policy Analysis
Posted on June 2, 2011

The main factors that currently, and will likely for the near future keep renewable from mainstream success in the marketplace are high costs and lack of on demand reliability relative to competing energy sources. Even if costs come down, and renewables cease to need subsidies for the minimal market penetration that they currently enjoy -- all due to government mandates and fiscal largesse at taxpayer/ratepayer expense -- until some cost effective, large scale storage technology is created that can store excess power generated by wind turbines and solar cells for release when the sun isn't shining or the wind isn't blowing, then these technologies will be relegated to the margins. I or other colleagues at the NCPA have detailed some of the problems with various renewable technologies Wind Power: Red not Green http://www.ncpa.org/pdfs/ba467.pdf, Solar Power Prospects http://www.ncpa.org/pdfs/st334.pdf and ethanolhttp://www.ncpa.org/pub/ba614, and http://www.ncpa.org/pub/ba591, and a comparison of various transportation fuel sources: http://www.ncpa.org/pub/ba590

In the end, renewables won't meet our personal trasportation needs or desires in the forseeable future and their success in electricity production will depend on improved efficiencies, lower costs and their ablilty to satisfy either baseload or peaking demand.

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David Fessler
Energy and Infrastructure Analyst, The Peak Energy Strategist
Posted on June 1, 2011
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In a word, profits. If renewables were profitable in their own right, then there would be hundreds of companies employing thousands of people manufacturing, installing and servicing solar panels and wind generators.

Right now they aren't profitable without government subsidies. Having said that, I believe that INITIALLY the subsidies are a good thing to get the economies of large scale manufacturing time to take hold to drive costs down. That's happening right now.

But until fossil fuels get so expensive (and they ultimately will) as to make renewables look cheap, we'll still be betwixt and between the two.

Raising the federal gasoline tax (which hasn't seen a raise 1993) would be one way of promoting electric vehicles. A feed-in tariff similar to what Germany adopted a few years back would jumpstart the wind and solar industry.

The only thing missing is the political will in Washington. But these days, that's the norm there, not the exception. It's all about getting re-elected, not actually accomplishing anything.

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Bruce Bley
Principal Consultant, B2E3.Group
Posted on June 1, 2011
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Good question: I believe that the biggest obstacles for getting renewable energy "to the market" are infrastructure, regulatory, financial and storage related. Transmission and distribution system currently has bottlenecks and NIMBY is preventing construction of new lines to connect generation sources to end users. It takes years and billions of dollars to construct these facilities. Who is going to pay for new lines? If a T&D utility is simply shipping energy from A to B and is not using it within their territory there is currently no financial benefit for them (or their ratepayers) to build them. FERC needs to address this issue quickly. And finally, there needs to be a mechanism to efficiently store the intermittent electricity generated by renewable sources until it is needed. No wind = no wind power. No sun = no solar power. This is a very complicated situation that involves technology and policy.

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Robert  Rapier
Chief Technology Officer, Merica International
Posted on June 1, 2011
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As noted by others, profitability is the main problem. It is simply more expensive at present to harvest on an annual basis something nature stored up over millions of years. I agree that there will come a time that fossil fuels are so expensive that renewables will start to gain broader market share.

Oil price volatility is also a major problem. As oil raced to $150 in 2008, many alternative energy technologies began to look attractive. However, projects take years to complete, and what was attractive at $150 would have been financial disaster at the year's end price in the $30's. If renewables are to grow and flourish, some of the oil price volatility needs to be dampened out of the market.

However, for liquid fuels one other major obstacle involves the scale of biofuels versus petroleum. Total ethanol production in the United States is presently about 13 billion gallons per year. We are the largest ethanol producer in the world. But on an energy equivalent basis, ExxonMobil's Baytown refinery processes more fuel than this. So it is one thing to talk about renewables getting to market; it is quite another to presume they can scale enough to displace large quantities of our oil consumption.

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Dan Snyder
Director of Technical Operations
Posted on June 1, 2011
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I agree that profitability is the main factor.

However, renewable energy sources are still in a large growth cycle. They are, to a degree, still more R&D projects than truly industrial or operational projects. Each year, the efficiencies and gains of renewable energy sources are improving. There is definitely some risk in deploying the existing generation rather than waiting a year or two for a more mature and cost/energy efficient generation.

So I think there is a bit of "let the technologies mature more" too that is hindering large scale deployments today.

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Kevin Coffee
Kevin Coffee Replied on June 2, 2011

I would rank the factors as follows:
1. Cost effectiveness
2. Land acquisition/permitting/environmental considerations.
3. Process for interconnecting projects to the grid.
4. Regulatory process.
5. For long distance transmission across multiple jurisdictions, cost allocation becomes a major factor.
6. Integrating the variable energy output of a renewable resource into the transmission grid.
7. R&D nature of some technologies.

In the end though, it comes down to cost and who pays the cost.

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Dan Snyder
Dan Snyder Replied on June 2, 2011

Your point on land acquisition and permitting is a good one. Especially for wind, which many people report as being an awful lot louder than they thought it would be.

Also, your point about losing so much of the energy in long distance transmission is a great one. Even though the US Southwest is great for solar, that doesn't help a lot when the largest demand is in the US Northeast and there are massive losses in transmission.

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Dan Snyder
Director of Technical Operations
Posted on June 2, 2011
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H. Sterling, those are fantastic articles.

Your point about wind power putting a huge hurt on birds is especially noted. I think deployed wind farms have noticed a small but measurable decrease in available wind as more wind farms come online. I agree that wind isn't a very good answer.

Burning corn (i.e. ethanol) seems to be a fantastically bad idea when there are a lot of people on the planet who are starving and would like to eat it. The only place I see good opportunities for biofuels are with the switchgrass that grows in places human edible crops can't grow, and with the various algae production experiments that continue to do well(i.e. Solazyme).

Oil shale does produce oil, but it also produces a LOT of relatively toxic byproduct, so there are some severe environmental consequences with shale oil.

I don't know a lot about coal liquefaction. But given as how the US energy problem is 2/3 heating and cooling of buildings and 1/3 transportation, it seems that coal is plenty busy supplying the 2/3 building energy need.

I think the key way forward is Solar, though I am curious if any of the "ocean power" energy generation from wave power will be efficient. I haven't seen the results of too many of those experiments.

Your point on Solar R&D hitting 41% efficiencies in labs today but needing many years to reach that in commercial applications is noted. But it is when efficiencies get into the 40-60% range that Solar looks incredibly effective as a long term power source.

I suspect that the 0.5% degradation of solar efficiency each year can be improved over time to maybe 0.2% or 0.1%.

I don't know what ever happened to research on room temperature superconductors, but if there ever is a breakthrough there that will help tremendously with the transmission problem and costs.

In terms of Solar reaching grid parity, 2020 isn't so far off.

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Martin Herzfeld
California Contractor Lic.# 833782 C-7 C46 D31 D56, MartinHerzfeld
Posted on June 3, 2011
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1. Concur, "I think the key way forward is Solar,...": http://www.asrc.cestm.albany.edu/perez/

In addition, I think we should use sunlight during times of sunlight when the sun is shining.

Simply, the overall usable energy may be greater than approximately 70% from the modules as the derate factor. For thin film modules, there are approximately half the cost and require approximately twice the area for ~c-Si modules. The best practice is to simply increase the number modules to increase power for non-optimal tilt, azimuth and efficiency to reduce labor costs.

2. The substantial portion of the costs are labor as one of the 'biggest obstacles to getting renewables to market.'

If you observe solar installations today, most of the installs on the roof are along the roof line parallel to the roof. As a result, the modules are less than optimal. In addition, the azimuth of the roof structure is not exactly to the south and at for instance, a ~30 degree tilt for most of the states.

The solar industry uses practices to reduce costs due to wind loading and approval of the authority having jurisdiction, the cost of installation of mounting, and other factors, to reduce labor costs. As a result, because the modules are installed with a less than optimal orientiation, modules are added to compensate for energy loss because of orientation and other factors.

The cost of modules are decreasing and the cost of energy is increasing which increases the rate of return. Grid parity is where the marginal cost of capital is less that the internal rate of return.

As a result, as the cost of modules continues to decrease, module efficiency reduces as a factor?

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Robin Goodchild
Owner, Antarctic Technologies
Posted on June 8, 2011
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But until fossil fuels get so expensive (and they ultimately will) as to make renewables look cheap

That is part of the problem - making other sources more expensive to make these look cheaper and more desirable is to just complete ignore the realities of the technology: that they do not work on a large scale!

Forget about cost of manufacturing them - we are bound by the laws of physics. As it is the system is limited to approximately 15% of all capacity being spurious, because if we introduce any more than this, then as these units come on/offline there is no way of regulating the power generated.

You may or may not know this, but as generating sets come online/offline, the frequency of the supply changes until it is load balanced to bring it back to the baseline. Equally, as consumers demand for energy changes, the characteristics of the supply change too, so as demand drops, line frequency increases (reduced load), so generation has to be taken offline to balance it out.

So whilst it is OK to dance around the issues of cost, until the physics of thing can be sorted out (and at present that isn't possible) large-scale wind/wave power will not work.

I'm in favor of siting wind turbines within a couple of miles of the consumers. Forget having massive power distribution networks - put the supply where the demand is.

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Robin Goodchild
Owner, Antarctic Technologies
Posted on June 8, 2011
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--- But until fossil fuels get so expensive (and they ultimately will) as to make renewables look cheap

That is part of the problem - making other sources more expensive to make these look cheaper and more desirable is to just completely ignore the realities of the technology: that they do not work on a large scale!

Forget about cost of manufacturing them - we are bound by the laws of physics. As it is the system is limited to approximately 15% of all capacity being spurious, because if we introduce any more than this, then as these units come on/offline there is no way of regulating the power generated.

You may or may not know this, but as generating sets come online/offline, the frequency of the supply changes until it is load balanced to bring it back to the baseline. Equally, as consumers demand for energy changes, the characteristics of the supply change too, so as demand drops, line frequency increases (reduced load), so generation has to be taken offline to balance it out.

So whilst it is OK to dance around the issues of cost, until the physics of thing can be sorted out (and at present that isn't possible) large-scale wind/wave power will not work.

I'm in favor of siting wind turbines within a couple of miles of the consumers. Forget having massive power distribution networks - put the supply where the demand is as far as the renewable component is concerned.

The other hurdle to overcome is the fact that MMGW is bogus, and that there isn't a problem with burning fossil fuels except for the fact the supplies are running out (oil is the biggest problem - it runs out in approx. 2050 at present rates of consumption) and we are reliant on other countries for it. There is plenty of gas in the world (1/3 of the worlds entire gas reserve is under the Arctic - and they're drilling for it as I type) which we can use, as well as having plenty of coal. Half of the problem with energy has been created by politicians and corrupt scientists.

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