If renewable energy is so awesome why haven’t we pulled the plug on fossil fuel yet? If you watch the news regularly, you probably know that climate change is a serious looming problem. But maybe you are not aware of what is going on. Geoffroy Stern, economics consultants gives us a highlight of the situation.
The current climate situation
We are burning too many fossil fuels, releasing too much carbone dioxide into the atmosphere, raising the planets average temperature. As it goes up, we see melting ice caps, sea level rise, changes in rainfall patterns. And if burning fossil fuels is at the root of those problems, why haven’t we kicked the dirty habit yet?
But you won’t be surprised to learn it is complicated. Firstly there is the fact that power sources like coal and natural gas are so entrenched. In the United States the first practical coal plant was built by Edison in 1882 and by 1961, coal was the major source of electricity.
From coal to natural gas
Opposed to European countries such as France, the United States has not really been able to get off coal since. It has been scaled back: 33% of power has been generated by coal this year. But the ground coal gave up was taken over by another fossil fuel: natural gas.
Geoffroy Stern explians that new extraction techniques; like fracking, made it cheaper helping it take over some of coal’s load and about 32% of our energy needs. While these sources are at the root of the greenhouse gas problem, they do have certain advantages over renewable energy: mainly they can ramp up output to meet demand. Solar and wind can’t do that. You only get energy when the sun is shining and the wind is blowing. So we have to build capacitors and batteries to store energy for when we need more. Otherwise we will have to have some fossil fuel or nuclear plants to meet demand.
Wind and solar renewable energy
According to Geoffroy Stern, investing in renewable energy is looking more and more attractive. We are getting to the point that building and running wind and solar facilities will be competitive with coal and natural gas plants over their life time.
They are more expensive upfront but their fuel cost zero dollar. So they become more reasonable over time. Stills renewable energy will need a bit of help by way of tax credits and subsidies to be truly competitive.