Plunging solar and wind prices have led to the brokering of new green power deals, from India to Mexico. Martin Wright gets energised about renewables
No one, it’s fair to say, really saw this coming. Even pundits who’d been predicting it for ages didn’t think it would happen so fast. ‘It’ is, of course, the renewables revolution, which has spun conventional wisdom on its head.
Like many revolutions, at its heart lies money. Driven by ambitious government programmes in Germany, India and China, along with fierce competition, prices of solar and wind power have plummeted farther– and faster – than anyone imagined possible. They have now reached the magical tipping point at which they start to compete head-on with fossil fuels. In Chile, a solar-based scheme won a major power auction by offering to supply electricity at a record low price of $29.10 (£22.80) per megawatt hour – well below the wholesale average. Prices in India, too, have tumbled, as that vast country cottons on to its solar potential. Chinese companies scrabbling for market share help push costs to new floors.
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As revolutions go, it’s so far been surprisingly apolitical. Conservatives may have traditionally opposed renewables, but the sheer weight of economic logic is shifting opinion, and fast. Over half of the renewable capacity recently installed in the US is in Republican-governed states. More US citizens are employed in solar power than in generating electricity through fossil fuels. The president may ‘dig coal’, as his campaign slogan had it, but when it comes to hard business logic, the markets trump Trump.
It’s not too much of a leap to imagine hardened Brexiteers jumping on to the green bandwagon with a cry of “British sparks from British wind!
Politics is playing its part, too. Every vehicle powered by electricity rather than petrol means less dependence on oil imports, many of which, of course, come from the Gulf states, with all the political entanglements that entails. The search for ‘energy independence’ helped fuel the drive for fracking; it’s starting to do the same for renewables. It’s not too much of a leap to imagine hardened Brexiteers jumping on to the green bandwagon with a cry of “British sparks from British wind! Let’s take back control of our energy!”
But before overheating with excitement, it’s only fair to remind ourselves that these are still early days. As a proportion of overall energy supply, renewables remain relatively puny. Wind and solar together accounted for just 4.4 per cent of world electricity production in 2015. Then there’s the inconvenient fact that the wind doesn’t always blow, and our sun doesn’t always shine. No matter how cheap the source, electricity grids needing to balance supply and demand struggle to accommodate large amounts of such ‘intermittent’ generation. So the day when renewables dominate the power market is still some way off.
But it is surely coming. Rapid advances in battery storage, led by Tesla, are helping to overcome intermittency issues. Electric vehicles are part of the storage solution as well, with their batteries acting as micro power plants to help balance the grid. The more there are, the more effective that role will be.
The president may ‘dig coal’, but when it comes to hard business logic, the markets trump Trump
Meanwhile, as growing numbers of households and businesses start to invest in their own generating capacity – principally solar – so we will start to see a network of ‘prosumers’: people who are not only consuming power, but producing it too, and earning income into the bargain. In turn, that could be the basis of a whole new pattern of energy infrastructure; one that’s moved away from a few centralised fossil or nuclear plants sending power down the grid, and towards a much more sophisticated, decentralised web of millions of producers and consumers, with electrons flowing to and fro: an ‘energy internet’, as it has been called. And in turn, that could herald a revolution not only in energy technology, but in its economics and its politics.
Renewable energy has experienced a few false dawns in its time. But few doubt that the sun is finally, and irrevocably, on the rise.
Martin Wright is a writer and editor specialising in environmental solutions and sustainable futures, and a director of Positive News
This article is featured in issue 90 of Positive News magazine. Become a subscriber member to receive Positive News magazine delivered to your door, plus you’ll get access to exclusive member benefits.