Published on October 28th, 2020 | by Zachary Shahan
October 28th, 2020 by Zachary Shahan¬†
The theme of the past decade in the energy industry has been sharply dropping solar power, wind power, and battery prices. This has already led to enormous changes in the energy sector across the world. However, it‚Äôs sort of like the arrival of somewhat low-cost cellular flip-phones. Yes, their arrival changed communications like many had not thought possible, but that was only the tiny beginning of the transformation. Smartphones later came along, led by the first Apple iPhone, and you can hardly even say that 2020 communications technology is in the same sector as flip-phones from the early 2000s.
So, yes, the energy sector ‚ÄĒ from electricity generation to energy sources that propel cars ‚ÄĒ has changed a great deal as solar power has gotten much cheaper. But we ain‚Äôt seen nothin‚Äô yet.
A¬†new report¬†by¬†RethinkX explores this topic much further. Here‚Äôs the one-line summary: ‚ÄúBy 2030 electricity systems comprised entirely of solar, wind and batteries (SWB) can provide both the cheapest power available and two to three times more total energy than the existing grid in the continental United States, and most populated regions globally, bankrupting coal, gas and nuclear power companies and slashing consumer costs dramatically.‚ÄĚ
Such cheap clean energy doesn‚Äôt just mean somewhat lower costs, though. It means disruption ‚ÄĒ to some extent or another. Why is it disruptive, not just cheaper? Because when you get down to basically ‚Äútoo cheap to meter,‚ÄĚ business models shift around, new business potential appears, and the market transforms.
‚ÄúA 100 percent SWB system will possess much more generation capacity than used on most days currently, which will produce an enormous amount of electricity at a marginal cost close to zero. The report authors show that this ‚ÄėClean Energy Super Power‚Äė will enable new business models and industries, create trillions in new value, and could help repatriate energy-intensive manufacturing.‚ÄĚ
Excess electricity at about $0 means a business or entire industry that relies on a lot of electricity will be attracted to the region like Pooh is attracted to honey. As this becomes the situation in many regions, electricity costs become a moot point for where to place a factory or other business, which can also shift the map around.
Of course, electric cars, electric buses, electric trucks, hydrogen storage facilities, and potentially even electric airplanes and robotaxis can soak up excess solar- and wind-produced electricity that‚Äôs going for $0.01/kWh or $0.00001/kWh or even negative prices.
‚ÄúNot only can it solve some of society‚Äôs most critical challenges but it will usher in hundreds of new business models and create industries that collectively transform the global economy,‚ÄĚ Tony Seba, RethinkX co-founder and report co-author, noted. ‚ÄúWhen a system generates hyperabundant electricity at a marginal cost close to zero, the potential for new value creation is limitless. This isn‚Äôt a problem of overcapacity. This is a Super Power¬†solution.‚ÄĚ
But really ‚ÄĒ is more than 100% renewable energy possible? I‚Äôm glad you asked. As I wrote just before this piece, a couple weeks ago, the state of South Australia produced 100% or more of its electricity from solar power alone for one hour. And that was just solar. And it‚Äôs just 2020.
‚ÄúThere is a misconception that too much solar and wind energy is a problem,‚ÄĚ said¬†Dr. Adam Dorr, report co-author. ‚ÄúThat is looking at the equation through the old fossil fuel system lens, and doesn‚Äôt recognize the fundamentals of disruption. Sunlight and wind are free, and it is irrational to curtail the nearly costless clean energy we produce with them. As with other technology disruptions, it is a mistake to ask how the existing system will accommodate SWB. The grid as we know it will rapidly evolve into a larger, more flexible, diverse and capable system, just like the landline telephone network evolved into the Internet. Instead we must ask, ‚Äėhow can a new energy system based on SWB minimize costs and maximize benefits at every level of society and the economy?‚Äô‚ÄĚ
Ah, I see now that they also brought the phone metaphor to the story. Cool.
‚ÄĒ Mark Z. Jacobson (@mzjacobson) October 27, 2020
For this report, RethinkX dove into the electricity systems in California, Texas, and New England. For more on the details of those states, check out the report.
‚ÄúThis report is the first in a series to examine the decisions required now in order to maximize the extraordinary benefits of a new energy system,‚ÄĚ the RethinkX team writes. So, stay tuned for more.
Importantly, the authors note that as we plow forward into this new energy system, it‚Äôs not only about technology. Anyone working in this sector has to have the right mindset.
‚ÄúIt is no longer a matter of if the SWB disruption of energy will happen, it is only a matter of when and where,‚ÄĚ James Arbib, co-founder of RethinkX, said. ‚ÄúTiming matters and the social, economic, political, and environmental stakes could not be higher. The actual outcomes depend on choices made today, and those who lead rather than follow or resist will benefit the most.‚ÄĚ
Naturally, RethinkX was not the first organization to think about electricity overproduction from renewable energy resources that are fundamentally free. Indeed, more than 8 years ago, researchers from the University of Delaware (UD) and Delaware Technical College (DTCC) put forward a ‚Äúradical‚ÄĚ idea for dealing with wind and solar power‚Äôs intermittency while also acknowledging wind and solar power‚Äôs falling costs: why not just overbuild wind and solar power plants in the future?
As we enter that era, though, aside from super cheap solar and wind ‚Äúprematurely‚ÄĚ shutting down power plants from more expensive fuel supplies (like coal, nuclear, and even natural gas power plants), the question is how fast and what type of growth we can, should, and will stimulate.
I returned to that 2012 study last month and found it as relevant as ever, but not quite as fringe.
Images courtesy RethinkX
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