WHY SOLAR MAKES SENSE
While a majority of the world's current electricity supply is generated from fossil fuels such as coal, oil and natural gas, these traditional energy sources face a number of challenges including rising prices, security concerns over dependence on foreign imports, growing environmental concerns over climate change risks associated with power generation using fossil fuels and decreasing amounts of nuclear generation in the utility generation mix. As a result of these and other challenges facing traditional energy sources, governments, businesses and consumers are increasingly supporting the development of alternative energy sources and new technologies for electricity generation. Renewable energy sources such as solar, biomass, geothermal, hydroelectric and windpower generation have emerged as potential alternatives to new fossil generation which address some of these concerns.
Solar power generation has emerged as one of the most rapidly growing renewable sources of electricity. Solar power generation has several advantages over other forms of electricity generation:.
- Reduced Dependence on Fossil Fuels. Solar energy production does not require fossil fuels and is therefore less dependent on this limited and expensive natural resource. Although there is variability in the amount and timing of sunlight over the day, season and year, a properly sized and configured system can be designed to be highly reliable while providing long-term, fixed price electricity supply.
- Reduced Dependence on the Water Supply. A 2012 study by the River Network stated for every gallon of water used in an average household, five times more water (40,000 gallons each month) is used to provide that home with electricity via hydropower turbines and fossil fuel power plants. Electricity production by coal, nuclear and natural gas power plants is the fastest-growing use of freshwater in the U.S., accounting for more than about half of all fresh, surface water withdrawals from rivers. This is more than any other economic sector, including agriculture, and occurs in an era when all other use sectors are reducing water withdrawals. The report notes that experimental “clean coal” technologies are only expected to significantly increase water use. The energy sector already accounts for about 15% of the world’s total water use, led by coal and nuclear generation each of which use approx. 500-800 gallons/MWh. By contrast, all solar power technologies use a modest amount of water (approximately 20 gallons per MWh) primarily for cleaning whereas a typical family uses about 20,000 gallons of water each year, more than the amount of water needed by a megawatt of photovoltaic generation capacity (i.e., generation that supports, on average, approx. 200 homes).
As of 2010, global water withdrawals by the energy industry stood at 583 billion cubic meters (BCM), and consumption stood at 66 BCM. Under current policies, IEA projects consumption will increase 85 percent by 2035, or over 120 BCM. Withdrawal will increase to 790 BCM. Under much more aggressive attempts to cut carbon emissions, IEA sees withdrawal barely rising at all by 2035 to, 600 BCM. But consumption would still double. Most of China and South Asia’s water resources are already “vulnerable,” India’s and some of Africa’s are “stressed,” and other parts of Africa are already suffering “absolute scarcity.” These areas are home to much of the world’s poorest and most vulnerable populations. Adding to this issue, there’s climate change: water sources become less reliable as higher temperatures drive more precipitation and evaporation: snowpack goes down, which hurts freshwater supplies; higher surface water temperatures can make power plant cooling more difficult; and floods and sea level rise threaten freshwater supplies with contamination.
- Environmental Advantages. Fossil fuels must be burned to produce electricity. Burning them creates unwanted byproducts that can create air and water pollution and release huge amounts of greenhouse gasses into the atmosphere. When in use, solar panels produce power without waste or emissions. Further, solar PV generation uses very little water, an increasingly precious commodity worldwide.
- Matching Peak Time Output with Peak Time Demand. Solar energy can effectively supplement electricity supply from an electricity transmission grid, such as when electricity demand peaks in the summer.
- Modularity and Scalability. As the size and generating capacity of a solar system are a function of the number of solar modules installed, applications of solar technology are readily scalable and versatile.
- Flexible Locations. Fossil fuels must be located, excavated and transported before they can be used. These processes are invasive and detrimental to the land through side effects such as erosion and ecological and geologic instability. Then the deposit or well is depleted. Energy from the sun is infinite and free. It can be harnessed and turned into power anywhere a solar panel can be mounted.
- Jobs. In 2012, there were a total of 137,650 permanent coal-related jobs nationwide and 806,831 oil and gas jobs as of 2011. By contrast, there were 3,401,279 green jobs in 2011. The Department of Energy predicts using conservative estimates that by 2030 there will be over half a million wind jobs alone. The overall job story is that renewable energy will provide more and higher paying jobs, with more diverse opportunities. This is because $1 million dollars’ worth of oil and natural gas output directly create 0.8 jobs, and $1 million of coal produces 1.9 jobs. By contrast, building retrofits for energy efficiency create 7 jobs per $1 million, mass transit services create 11 jobs per $1 million and other areas fare as well: building the smart grid (4.3), wind (4.6), solar (5.4), and biomass power generation (7.4).
The green economy already supports more jobs than the fossil fuel economy, and has for years, even though renewable energy accounts for only 11.98% of our domestically produced energy. The writing is on the wall: the key to creating American jobs now and in the future is not investment in fossil fuels, it is investment in the green economy. While many tout that putting a price on carbon will cost jobs, that argument is flawed: wind, solar, and biomass generate 2.5 – 9.25 times as many jobs as coal, oil, and gas for every $1 million contribution to GDP.
The evidence against the fossil fuel and utility lobbies is now so convincing that voters, energy customers, and most everyone else recognize that opposition to renewable energy is based solely on lost corporate profits; cries of “higher energy costs” and “lost jobs” are no longer credible arguments against the clean energy revolution.
- Price. Solar panels have a seen a consistent drop in prices over the last three decades, and in the last few years that drop has been meteoric. In the last 35 years solar panel prices have gone from $75/watt to around $.75/watt. Since 2008, the cost of coal has risen 13 percent. In some parts of the country – the most heavily populated areas – solar has already reached parity with utility prices.
While utilities and fossil fuel companies often state that solar is only economically effective due to government incentives, that argument is fatally flawed (as well as misleading) as oil, gas and coal receive subsidies that dwarf those of renewables ($409 billion vs. $60 billion globally). The obvious question is if fossil fuels are such a great deal for the American consumer, why does that sector require any particularly aggressive assist by the government? For fossil fuels, the incentives are enormous and include favorable leasing deals, R&D support, and infrastructure support as well as consideration in tax law, a lot of which the fossil fuel industry has enjoyed since its inception. Incentives also includes a long history of excuse from a full accounting of the local and regional environmental, economic, and public health impacts of fossil fuel operations, a situation that is only just beginning to be remedied.
- Utilities’ Capacity is Changing. Two-thirds of global solar capacity has been installed over the last three years. In contrast, 175 coal fired power plants in the U.S. are expected to be shut down over the next five years, which comprises more than 10 percent of total capacity. This is because the average age of coal plants in the U.S. is over 44 years, well beyond the useful life of such plants. New EPA regulations on air quality will likely serve to hasten the retirement of such old, inefficient and dirty generating units.
Since 2007, electricity generation from coal has fallen 24.9% from 2.02 billion MWh to 1.51 billion MWh in 2012. Meanwhile, over the same time frame wind grew 309% to 140.8 million MWh and solar grew 607% to 4.3 million MWh. That doesn't include distributed solar on residential rooftops or any installations from 2013, which was a record year for solar, installing about 4.4 GW in the U.S.
- Investment is Changing. While fossil fuels and utilities have been an omnipresent part of investment portfolios for decades, their reign may be coming to an end. Recently a number of reports have shed light on a possible impending correction wherein fossil fuel companies, which are valued in the market based on their reserves of unburned fuel still in the ground, may become less valuable due to the fact that climate change legislation may make a portion of such reserves economically unusable. This means that many fossil fuel companies are overvalued as they potentially have huge unburnable reserves of fuel. Several leading institutions believe once stricter climate regulations are put in place, the value of fossil fuel companies may fall drastically. Already, coal companies have dropped in value 75 percent over the last five years.
Major investors are already making this move. Warren Buffett has invested in one of the largest solar farms in the world and has predicted the end of coal as an American power source. It’s also worth noting, in terms of national energy policy, that the U.S. military has been aggressively leading the charge into clean energy from all angles, including advanced energy storage solutions that have already been flagged as a game-changer in the electric utility industry.
- Flexibility On and Off-Grid. Despite the cost, an advantage of photovoltaic systems is that they can be used in remote areas. Anywhere a diesel generator is the technology of choice, many times a photovoltaic system is a much better life-cycle cost option. Stand-alone photovoltaic systems produce power independently of the utility grid. In some off-the-grid locations even one half kilometer from power lines, stand-alone photovoltaic systems can be more cost-effective than extending power lines. They are especially appropriate for remote, environmentally sensitive areas, such as national parks, cabins, and remote homes.
Since the second industrial revolution got going 150 years ago, fossil fuels drove the global economy to expand by a staggering 5,000%. In those days, people generally consumed only as much energy as their own labor could provide. Nowadays, however, Americans consume energy at a rate of roughly 10 kW which is roughly equivalent to 500 manual laborers working 40 hour weeks for every man, woman and child. On the production side, while average cost of extracting fossil fuels has slowly risen since the turn of the century, the meteoric rise in market prices over the same period has made the fossil fuel industry immensely profitable. Not only do these windfall profits pay very handsome dividends to private investors, they also deliver handsome tax revenues to governments. Thus, change is immensely difficult and can be, at times, confrontational. However, the facts and figures are clearly and unambiguously demonstrating that renewable energy is cost-effective, efficient, clean, and that it is a positive development for the energy sector, moving into the future.