On the eve of the Climate Week NYC kicking off on Tuesday, Greenpeace has called on nations to place more reliance on renewable energy. It says further that clean energy economics is now getting better and better. ‘Reinventing Fire’ by the Rocky Mountain Institute, had predicted four years ago that companies and countries will be leading climate protection, rather than international organizations and treaties. The civil society and the private sector would get more involved than the governments and leading developing economies as opposed to matured and developed economies will pave the way.
The economic fundamentals of clean energy and efficiency rather than carbon pricing in the future will be the focus.
Global investment in renewable energy in the year 2013 alone was $254 billion, and that does not include the big hydropower. Another $310 to $360 was added by energy efficiency and a further $70 billion from cogeneration of electricity from useful heat. Together the three carbon savers attracted some $650 billion in capital in just one year.
In the U.S., the fixed price for selling U.S.windpower and solar power on a utility scale have in recent times averaged below the 0.025 and 0.04 per kWh for long term contracts. These are net prices after factoring in federal subsidies. But, the subsidy on wind power has expired and by the end of 2016, two-thirds of the subsidy for solar will also vanish. Nevertheless, both will emerge winners in spite of the permanent subsidies enjoyed by fossil fuels for decades. Solar and wind energy would continue to average below $0.06 and 0.04 respectively. Consequently, many of the new plants based on fossil fuel would be forced to close down for want of economic viability.
Over the next 15 years, it is expected the plants based on fossil fuel would reduce their capacity by 50% (without accounting for bigger retirements) while renewable would double their capacities. Renewables, without considering the bigger hydropower and including cogeneration accounts for 50% of all new generation producing a quarter of global electricity needs.
Energy efficiency is another area that makes things even cheaper. Smarter technologies have aided enormous savings for some 40 years now. But, this remains invisible while the renewables are in the limelight because they are distinctly visible.
Interestingly, many of the developed countries across the globe are using lesser energy in spite of decent overall growth in their economies. Germany, for instance, has set an example of how renewable energy can be a profitable alternative to fossil fuels.
Greenpeace says nations should place more reliance on renewable energy
