Is a High Renewables Future Really Possible? (Part 2)

In yesterday’s Part 1, I explored common criticisms skeptics level against the prospect of a high renewables future, then highlighted the growing consensus of futures studies and other evidence that say a high renewables future is very possible. Today, I look at examples from around the world where high renewables are already becoming a reality, and conclude with a look at the work RMI is doing to make a high renewables a broader reality in the U.S. and beyond.

High Renewables are a Reality Today

The futures studies (referenced in yesterday’s post) are not a guarantee of what will happen. They’re various visions of what could happen. But increasingly, these possible futures are shifting from the hypothetical to the real. Around the world, economies are shifting to ones grounded in high penetrations of renewables.

In one sense, this isn’t news. Historically, there has been no shortage of countries powered mostly—even entirely—by renewables. But these countries, ranging from Norway and Sweden to Paraguay and Venezuela, have depended on large amounts of hydro. Yet we’re now seeing examples of high renewables powered by wind and solar, too.

In Denmark, the Danish Energy Agency set a bold goal for the country’s power to be 100 percent renewable by 2050, including generating 50 percent of electricity from wind by 2020. The country is well on its way to realizing that vision. In 2011, renewables accounted for more than 40 percent of Denmark’s domestic electricity production; wind power accounted for 28 percent of electricity generation. Then last year, wind crossed the 30 percent threshold. This year an offshore wind farm is expected to add another 400 MW to the country’s already installed 4.2 GW of wind capacity. Earlier this year in March, wind generated nearly 4 GW of power for the grid, just 800 MW shy of the entire country’s electricity needs. Later that same month, wind output exceeded nationwide demand, even if only for a short period.

There’s been similar success on a much larger scale in Spain, where installed wind capacity is five times that of Denmark. On a day in April 2012, wind supplied 61 percent of Spain’s electricity demand.

Momentary high-percentage outputs from variable renewables and Denmark’s ramp-up of renewables—with wind’s longer-term contributions to the grid there—have been more than commendable. In Portugal, meanwhile, we’re seeing equally impressive numbers of renewables’ sustained contributions of power to the grid. For a few hours toward the end of 2011, renewables supplied 100 percent of Portugal’s electricity. But over the first quarter of this year—three full months of 2013—renewables supplied an impressive 70 percent of that country’s power. Hydro accounted for 37 percent of electricity; wind ranked second with 27 percent of generation.

These are noteworthy numbers, especially considering that the best wind generation in the United States is contributing for a moment or for a day what Denmark and Portugal’s wind sites are reliably producing week in and week out. In February wind supplied 28 percent of Texas’s power for a day, and in California in April wind recently hit 17.5 percent of the state’s electricity consumption (renewables in total hit nearly 29 percent).

Then there is oft-cited Germany. What countries such as Denmark and Portugal have done with wind, Germany is doing with solar (buoyed by wind). In Germany last year, 23 percent of power came from renewables—a mix of wind, biomass, hydro, and solar, with solar the fastest-growing of the lot. More recently, in May 2012, solar in Germany set new records. On a Saturday (with factories and offices closed, and thus demand lower) solar met fully half of Germany’s electricity needs. One day earlier, when demand was higher, solar still provided a third of the nation’s electricity. Over the course of that whole month, solar provided 10 percent of Germany’s power. Then earlier this year, Germany set another national record, when the nation’s solar panels put out a peak of 22.68 GW of power at noon and 167 GWh over course of that day, meeting 12 percent of the country’s electricity need.

While these numbers—coming from the world’s number four and Europe’s number one economy—don’t yet evidence the kind of high renewables the futures studies say is possible, Germany is on track to hit 35 percent renewable electricity by 2020, 50 percent renewables by 2030, 65 percent by 2040, and 80 percent by 2050.

Finally, we have Australia, where a combination of wind and solar is reason to take notice. For certain, Australia is far from a high renewables reality. It has just 1/10 the installed solar capacity of Germany, for example, but the Land Down Under is poised to get there. Why? Because already at lower penetration rates, renewables are beating out fossil fuels on price. According to Bloomberg New Energy Finance, new wind is cheaper than new coal or new natural gas without carbon pricing factored in. Wind is 14 percent cheaper than coal and 18 percent cheaper than natural gas. Utility-scale solar PV is expected to follow suit by 2020 with Australia’s carbon pricing factored in.

The country has set a nationwide official target of generating 20 percent of its electricity from renewables by 2020. There’s reason to believe, though, that Australia may go further. In April this year, a study published in Energy Policy highlighted a 100-percent renewables future for Australia, while maintaining established grid reliability standards. Moreover, that high renewables future would become cost effective (compared to providing that power via fossil fuels) sometime between 2030 and 2045, depending on assumptions about carbon pricing and discount rates.

RMI’s Role in Helping Achieve High Renewable Electricity Futures

RMI is helping to pave the way toward a high renewable electricity future through integrated efforts across its programs. The Institute’s Electricity Innovation Lab (eLab), which brings together dozens of leading organizations involved in integrating distributed renewables into the electricity system, is helping to drive the development of new business models and pricing structures to level the playing field between centralized and distributed resources and open the door to higher levels of renewable supply integration overall.

Through eLab, RMI is integrally involved in FortZED, a joint effort of the City of Fort Collins, Colorado State University, and other partners to develop a significant zero energy district eventually powered primarily by wind and solar. eLab is also helping the U.S. Navy in planning and designing microgrids to support the Navy’s ambitious goals to supply 50 percent of its electricity needs from renewable sources.

Meanwhile, RMI is diagnosing exactly how to reduce solar’s “balance of system” costs through innovative approaches that streamline industry practices and reduce obstacles in interconnection and permitting.

High renewables scenarios are no longer about if we can, but rather about if we will. “It’s not that problems [posed by skeptics] aren’t real or challenging,” says RMI’s James Newcomb, “but more about using the tools we already have in hand—advanced grid technologies, new business models, and competitive market designs—to craft workable solutions.”

It is time to put away the skepticism, role up our sleeves, and wrestle with the real but very solvable challenges we face in getting to the high renewables future that’s rapidly becoming today’s reality.

Recommended Reading 

• Is A High Renewable’s Energy Policy Really Possible? (Part 1)
• Germany’s Renewables Revolution
• eLab: The Value of Distributed Energy Resources

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