STEP 01 AIM FOR 100% RE­NEW­ABLE ELEC­TRIC­ITY

The oft-re­peated ob­jec­tions to achiev­ing 100% elec­tric­ity from clean, non-pol­lut­ing sources are now myths, thanks to tech­no­log­i­cal ad­vances and re­duc­tion in re­new­able gen­er­a­tion costs.

Element - - Planet - By Dr Eric Martinot

NRe­new­able elec­tric­ity for New Zealand’s fu­ture ew Zealand could eas­ily reach the goal of nearly 100% of its elec­tric­ity from re­new­able en­ergy in the com­ing two decades. And it would be folly not to. The coun­try al­ready re­ceives about 70-75% of elec­tric­ity from hy­dro and geo­ther­mal, and an­other 5% from wind and biomass. So New Zealand al­ready en­joys one of the high­est shares of re­new­able elec­tric­ity in the world. But that share could be much higher with fur­ther ad­di­tions of wind, so­lar and geo­ther­mal.

In reach­ing for higher shares of re­new­ables, we would be far from alone. Den­mark is plan­ning 100% re­new­able elec­tric­ity by 2030, and its util­i­ties and com­pa­nies are al­ready ac­tively work­ing to­wards this goal. Ger­many plans 50% by 2030 and 80% by 2050, up from 20% to­day. Ger­many is se­ri­ous about this tar­get and be­lieves it’s achiev­able. Over 120 coun­tries around the world now have tar­gets for fu­ture shares of re­new­able en­ergy, along with poli­cies to sup­port those tar­gets.

New Zealand has seen mod­est growth in re­new­ables in re­cent years, but still far from its po­ten­tial. Why isn’t more be­ing done? Cer­tainly national pol­icy is to blame, as New Zealand lags well be­hind other de­vel­oped coun­tries in the strength of poli­cies to sup­port re­new­able en­ergy. But more fun­da­men­tally, it’s the con­ven­tional wis­dom that is to blame.

There are many myths that per­sist about re­new­able en­ergy that are sim­ply no longer true. Con­ven­tional think­ing is out of date with the re­al­ity of where re­new­able en­ergy tech­nolo­gies, costs, mar­kets, and in­vest­ments are to­day, and where they are go­ing in the fu­ture. For ex­am­ple, most would be shocked to learn that the $250 bil­lion in­vested an­nu­ally in new re­new­able en­ergy ca­pac­ity is now more than the world in­vests each year in fos­sil-fuel and nu­clear power gen­er­a­tion com­bined. And pro­jec­tions show a dou­bling to $500 bil­lion an­nu­ally within 10-15 years, led by China and de­vel­op­ing coun­tries.

Last year in Europe, 80% of new power ca­pac­ity added was re­new­able, and only 20% was fos­sil fu­els and nu­clear. China added 13 gi­gawatts of wind power last year alone, more than the ca­pac­ity of New Zealand’s en­tire power sys­tem. Wind power in China now gen­er­ates more en­ergy each year than nu­clear power. And South Africa is plan­ning for 38% of all added ca­pac­ity to be re­new­able by 2030.

Among the many myths about re­new­ables, per­haps the most per­sis­tent is the “in­ter­mit­tency” or “im­pos­si­ble to bal­ance” ar­gu­ment. Many claim that large shares of vari­able wind and so­lar are too dif­fi­cult to bal­ance (pro­vide sta­ble power when needed) on power grids due to their in­ter­mit­tent na­ture. Not true. There are a dozen prac­ti­cal op­tions for bal­anc­ing, and all of th­ese are al­ready be­ing used by power util­i­ties around the world to­day.

For ex­am­ple, the U.S. state of Texas gets half of its re­serve power ca­pac­ity from “de­mand re­sponse” – the abil­ity to switch on and off mil­lions of “smart” cus­tomer loads, per agree­ment, that are par­tially flex­i­ble as to when they can op­er­ate – such as some in­dus­trial pro­cesses, and elec­tric ve­hi­cle charg­ing. To a power com­pany, de­man­dresponse acts like a power plant, but is a much cheaper

op­tion for bal­anc­ing.

In China, there is an ex­plo­sion in the use of cheap con­ven­tional bat­ter­ies with so­lar panels among many types of con­sumers. Large-scale en­ergy stor­age projects are emerg­ing on grids in the U.S., built by third-party de­vel­op­ers who sell the flex­i­bil­ity to util­i­ties at profit. And emerg­ing forms of en­ergy stor­age will be­come cheaper and play a big­ger role in the fu­ture.

An­other com­mon bal­anc­ing mea­sure is so­phis­ti­cated weather fore­cast­ing to ac­cu­rately pre­dict wind and so­lar power out­put for the fol­low­ing days. Such fore­cast­ing is used in Spain, for ex­am­ple, where on some days, wind and so­lar now sup­ply more than 50% of Spain’s day­time power de­mand.

For New Zealand, th­ese op­tions, and oth­ers, are pos­si­ble. Nat­u­ral gas will con­tinue to play a part, and is a good bal­anc­ing fuel, which can be ap­plied to dis­trib­uted elec­tric­ity pro­duc­tion in com­bi­na­tion with so­lar power, for ex­am­ple with build­ing-scale mi­cro-tur­bines that also sup­ply heat­ing. Rooftop so­lar can re­duce day­time-peak de­mand, even on cloudy ways. Wind farms can be built in dif­fer­ent re­gions which, when ag­gre­gated, pro­vide more bal­ance. Wind, so­lar, and hy­dro can nat­u­rally bal­ance each other in New Zealand’s cli­mate, on both long and short time scales, if their de­vel­op­ment were co­or­di­nated and in­tel­li­gent, with ad­di­tional trans­mis­sion and pumped-hy­dro stor­age.

Power grids his­tor­i­cally have been de­signed and reg­u­lated with three fun­da­men­tal as­sump­tions: that power only flows from cen­tral pro­ducer to dis­trib­uted con­sumer; that elec­tric­ity can’t be stored; and that sup­ply must fol­low de­mand. None of th­ese as­sump­tions are true any longer, and the power in­dus­try in many coun­tries is be­gin­ning to face the re­al­ity that many changes will be needed. The fu­ture of power grids is one of flex­i­bil­ity, mod­u­lar­ity, bal­anc­ing, in­no­va­tion, and new pric­ing and busi­ness mod­els. A whole new gen­er­a­tion of pol­icy and mar­ket re­form will be nec­es­sary to bring about this tran­si­tion. New Zealand is go­ing to have to face this too, one way or an­other.

An­other per­sis­tent myth is that there’s “not enough land.” In New Zealand’s case, the co-ex­is­tence of wind power with farm land is ob­vi­ous and wide­spread, and pro­vides ex­tra rev­enue to farm­ers. But part of the prob­lem with early de­vel­op­ment of wind power in New Zealand is that de­vel­op­ers have pushed to build on the ab­so­lute best sites, which has led to prob­lems of so­cial ac­cep­tance. New Zealand’s wind re­source is among the very best in the world. There are so many good op­por­tu­ni­ties for de­vel­op­ment that it is un­nec­es­sary to de­velop on high­vis­i­bil­ity sites that in­voke the pub­lic ire. (Other coun­tries do far more on much-less-op­ti­mal sites.) Pol­icy changes are nec­es­sary to chan­nel wind power de­vel­op­ment in more pro­duc­tive di­rec­tions, and the 2011 National Pol­icy State­ment on re­new­ables is a good start.

Fi­nally, the myth still per­sists that re­new­able en­ergy is “too ex­pen­sive.” Re­new­able en­ergy costs con­tinue to de­cline and com­par­isons with fos­sil fu­els are not be­ing made prop­erly. Wind power costs have de­clined 25% in re­cent years, and con­tracts are be­ing signed in the U.S. at prices com­pet­i­tive with gas and coal. So­lar panels only cost one-third of what they did four years ago. In fact, so­lar panels are now so cheap that their price is al­most ir­rel­e­vant – the main cost of so­lar power is now the in­stal­la­tion and labour cost, the mount­ing ma­te­ri­als, the wiring, and the bal­ance-of-sys­tem elec­tron­ics. Such costs are can be re­duced given the right busi­ness mod­els, economies of scale, so­lar-in­te­grated build­ing ma­te­ri­als, and changes in build­ing codes and labour re­quire­ments.

So­lar “grid par­ity” is spread­ing around the world. That means the cost of so­lar power with­out sub­si­dies is no more than re­tail elec­tric­ity prices. Grid par­ity now ex­ists in Hawaii and Spain, for ex­am­ple. More places will see grid par­ity in the com­ing years, in­clud­ing New Zealand. But why wait? The coun­try could be in­no­vat­ing so­lar ap­pli­ca­tions al­ready with mod­est pol­icy sup­port.

Be­yond the myths lies the re­al­ity that busi­ness op­por­tu­ni­ties for re­new­able en­ergy are vast, and not limited to man­u­fac­tur­ing so­lar panels and wind tur­bines. Many busi­ness op­por­tu­ni­ties ex­ist for a wide va­ri­ety of com­pa­nies in ap­ply­ing and in­te­grat­ing re­new­able elec­tric­ity and heat­ing. This in­cludes IT com­pa­nies, build­ing-ma­te­ri­als man­u­fac­tur­ers, con­struc­tion com­pa­nies, sys­tem in­te­gra­tors, en­ergy-ser­vice com­pa­nies, mi­croutil­i­ties, and de­mand-re­duc­tion ag­gre­ga­tors.

Re­new­able en­ergy is fun­da­men­tally be­com­ing a de­sign, in­te­gra­tion, ser­vice, and busi­ness-model prob­lem, not a tech­nol­ogy or man­u­fac­tur­ing one. New Zealand can more eas­ily par­tic­i­pate and pros­per in that than most re­alise.

And of course there are many ben­e­fits, such as in­de­pen­dence from fu­ture price shocks in global fos­sil-fuel mar­kets, car­bon emis­sions re­duc­tions, and a green im­age for tourism. Re­new­able elec­tric­ity will also al­low New Zealand’s trans­port sys­tem to be­come sus­tain­able, us­ing a com­bi­na­tion of elec­tric ve­hi­cles, plug-in hy­brids, and bio­fu­els (see fol­low­ing ar­ti­cles). That would mean New Zealand could save fos­sil fu­els for es­sen­tial pur­poses only; freight, ship­ping and air travel.

New Zealand needs much stronger poli­cies for re­new­able en­ergy. The 90% pol­icy goal es­tab­lished some years back was a start, but many other poli­cies are pos­si­ble, draw­ing from in­ter­na­tional ex­pe­ri­ence. Putting a price on car­bon emis­sions is not the best ap­proach; it won’t be enough by it­self, and it is not work­ing in Europe. Rather, pol­icy needs to fo­cus on in­te­gra­tion – into power grids, build­ings, trans­port, and in­dus­try. The world is about to see an en­tire new gen­er­a­tion of such poli­cies, and New Zealand should not be left be­hind.

Photo: Martin Stock­dale

DR. ERIC MARTINOT

Photo: Si­mon Baker

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