Facts Show Renewable Energy Success

Renewable Power is Increasingly Economical and Poised for Explosive Growth in The United States

Fierce Energy
February 22, 2013

DBL Part­ners’ Man­ag­ing Part­ner Nan­cy Pfund is quot­ed in this Fierce Ener­gy piece about the recent Amer­i­can Coun­cil on Renew­able Ener­gy (ACORE) pol­i­cy forum brain­storm­ing ses­sion.  Indus­try ana­lysts and oth­ers with inter­ests in the renew­ables space used the forum to out­line what the mix of renew­ables and lega­cy ener­gy sources should look like in future ener­gy pol­i­cy.  The costs of renew­ables like solar and wind have fall­en to the point where some (wind, specif­i­cal­ly) are on par with coal.  The stage is set for “explo­sive” growth in renew­ables, and ensur­ing a healthy mix of them in ener­gy pol­i­cy will see that through.  

There are plen­ty of mis­con­cep­tions about the costs and ben­e­fits of renew­able ener­gy. But while opin­ions vary as to the effec­tive­ness of gen­er­a­tion sources such as wind and solar, facts are indis­putable. And the facts show that renew­able pow­er is increas­ing­ly eco­nom­i­cal and poised for explo­sive growth in the Unit­ed States.

While the U.S. actu­al­ly saw sub­stan­tial decline in the renew­able ener­gy invest­ment dol­lars from 2011–2012 (from $300 bil­lion down to $270 bil­lion), that’s a mis­lead­ing fig­ure. The drop can be attrib­uted, in part, to falling costs of renew­able ener­gy mate­ri­als, and increased ener­gy use. In fact, 2012 was a record year for U.S. installed renew­able capac­i­ty at 17.4 GW.

Facts show that renewable power is increasingly economical and poised for explosive growth in the United States. Read more: Facts show renewable energy success - FierceEnergy http://www.fierceenergy.com/story/facts-show-renewable-energy-success/2013-02-19#ixzz2LaQ6SzDS Subscribe: http://www.fierceenergy.com/signup?sourceform=Viral-Tynt-FierceEnergy-FierceEnergy

Facts show that renew­able pow­er is increas­ing­ly eco­nom­i­cal and poised for explo­sive growth in the Unit­ed States.

Solar had a very strong year, but real­ly wind was the big win­ner over­all in terms of capac­i­ty,” said Ethan Zindler, head of pol­i­cy analy­sis at Bloomberg New Ener­gy Finance.

Zindler was part of a gath­er­ing of ener­gy ana­lysts at a recent Amer­i­can Coun­cil on Renew­able Ener­gy (ACORE) pol­i­cy forum, which high­light­ed indus­try advance­ments and act­ed as a brain­storm­ing ses­sion for the future of renew­able ener­gy pol­i­cy. While not opti­mistic about how renew­able ener­gy would fare over the next cou­ple years, Zindler not­ed that these tech­nolo­gies — wind, in par­tic­u­lar — are approach­ing cost par­i­ty with coal gen­er­a­tion.

Renew­ables enjoy falling costs

A Bloomberg New Ener­gy Finance analy­sis shows a 20–30 per­cent drop in the lev­elized costs (with­out sub­si­dies) of pho­to­volta­ic tech­nol­o­gy over the past 12 months, and the price of wind gen­er­a­tion con­tin­ues to be down.  “The short answer is that, in a num­ber of cas­es, these tech­nolo­gies real­ly are now very much get­ting close to being com­pet­i­tive with their fos­sil rivals,” Zindler said.

Mak­ing costs more rea­son­able is a prod­uct of increased invest­ment and research, and much of it was spurred from the Amer­i­can Recov­ery and Rein­vest­ment Act of 2009, a pol­i­cy move that pumped sub­stan­tial cash into renew­able ener­gy. The ulti­mate goal is to see the cost of solar, wind and geot­her­mal sys­tems con­tin­ue to fall. This is becom­ing increas­ing­ly nec­es­sary as nat­ur­al gas prices remain at his­toric lows.

Renew­ables will go toe-to-toe with nat­ur­al gas in the com­ing years, as state Renew­able Port­fo­lio Stan­dards and U.S. Envi­ron­men­tal Pro­tec­tion Agency reg­u­la­tions make it tougher to build new coal gen­er­a­tion and more cum­ber­some to keep old units oper­at­ing.

Impor­tance of con­tin­ued pol­i­cy sup­port

Just as pol­i­cy can encour­age devel­op­ment, its absence can stunt it. Renew­ables spend­ing slowed recent­ly over fear of revoked renew­able pro­duc­tion tax cred­its and sub­si­dies.

In time, the renew­ables indus­try will cer­tain­ly thrive on its own. But for now, pol­i­cy is crit­i­cal to sup­port­ing renew­able ener­gy growth.

Not only will pol­i­cy offer much need­ed finan­cial sup­port, but it is also part of the coun­try’s her­itage, accord­ing to Nan­cy Pfund, man­ag­ing part­ner at ven­ture cap­i­tal firm DBL Part­ners.

Even from the ear­ly days of land grants and coal rail­road devel­op­ment, the gov­ern­ment has played a crit­i­cal role in sup­port­ing the emer­gence of new tech­nolo­gies in the ener­gy field and tran­si­tion­ing us from one to the oth­er,” Pfund said, speak­ing at the ACORE forum.

Few of those pre­sent­ing at the forum pro­ject­ed wide-sweep­ing ener­gy leg­is­la­tion to hit any time soon.  But absent a com­pre­hen­sive ener­gy reform bill, there are like­ly to be incre­men­tal changes to help erect a stronger ener­gy roadmap, includ­ing focus­ing on con­tin­u­ing sup­port for fund­ing that could fur­ther dri­ve down the cost of renew­ables.

Per­haps Con­gress should also heed research that demon­strates a grow­ing num­ber Amer­i­cans want and sup­port renew­able ener­gy.

All the polls, all the stud­ies show that Amer­i­can’s love solar ener­gy and they want the gov­ern­ment to pur­sue poli­cies that sup­port it,” Pfund said. She pre­dict­ed that over the next few years, the renew­able ener­gy dis­cus­sion will shift from pol­i­cy pro­fes­sion­als to the broad­er con­sumer mar­ket­place.

This con­sumer sup­port also cre­ates an oppor­tu­ni­ty for util­i­ties to work with law­mak­ers in dri­ving renew­able ener­gy pol­i­cy and growth, she said.

All in all, the facts seem to be pil­ing up on the side of renew­able ener­gy. Pol­i­cy reform has been shown to work, and has dri­ven costs down. Like­wise, a lack of firm pol­i­cy has slowed advance­ment, again a tes­ta­ment to it’s poten­tial effec­tive­ness. The next few years will be crit­i­cal and chal­leng­ing for renew­ble ener­gy, but as long as installed capac­i­ty con­tin­ues to grow, and the facts demon­strate improve­ment, it will be tough to make the argu­ment against these gen­er­a­tion sources and the poli­cies that sup­port them.