The solar revolution is well underway. For years, the price of solar power has been plummeting, and is now the cheapest form of new electricity generation in many markets, including 16 U.S. states, Spain, Italy and India, according to energy research and consultancy firm Wood Mackenzie. Even through the pandemic, solar development stayed strong. In 2020, global solar capacity installation exceeded 115 gigawatts (GW). And even as solar panel prices rose last year, the cost of solar still managed to fall in 2021. While solar expansion has been on the rise in accordance with its increasingly competitive prices, however, it has not been swift or serious enough to fit with the growth trajectory needed in order to achieve the decarbonization targets set by the Paris Agreement in 2015. Instead, the renewable revolution has been met by the massive and seemingly immovable force of inertia.
On top of pushback from powerful fossil fuel lobbies and their allies, the current energy system is already heavily invested in fossil fuels, and continuing to run a coal- or gas- powered plant is often cheaper than building new solar infrastructure, as inexpensive as that new infrastructure may be. What’s more, “there is a lot of inertia in the system due to long-term contracts between utilities, energy producers, and mining companies,” Popular Science reported last year. “And since the country’s total energy use is not increasing that much every year, there isn’t much incentive to build new renewables.”
The global economy needed a major shock to the system in order to disrupt all this built-in inertia. And now we have it. The double whammy of the Covid-19 pandemic and Russia’s illegal invasion of Ukraine have sent shockwaves through the global economy and sent energy markets spiraling into disarray and scrambling for alternatives to Russian exports to keep the lights on and re-establish energy security. And many have set their eyes on solar to get it done.
In Europe, 18 out of 27 European Union countries set new records for solar power generation between May and August of this year, and the bloc is on track to see an average yearly increase of between 45GW and 52GW leading up to 2030 – a massive increase compared to pre-invasion projections. In the United States, the Inflation Reduction Act has offered massive tax breaks for clean energy development and solar investment is already exploding in response. Consulting titan McKinsey projects that global renewable electricity capacity will almost triple between 2021 and 2030, reaching over 8,800 gigawatts. The vast majority of this will come from onshore wind and solar.
While the incentives and the investments are there, however, the renewable revolution faces three major hurdles as it continues to expand at a breakneck speed: land, permits, and energy grids.
Land may be the biggest of these issues. “Utility-scale solar and wind farms require at least ten times as much space per unit of power as coal- or natural gas–fired power plants, including the land used to produce and transport the fossil fuels,” Mckenzie reports in a warning to solar investors. Indeed, renewable energy expansion is already embroiled in land-use battles across the nation as projects are developed in rural states which are often deeply red and devoted to fossil fuels. Currently, a ‘nasty’ fight is playing out in Indiana where a solar farm nearly the size of Manhattan is in the works.
Expansion is also bogged down by “long, unpredictable development guidelines” outside the control of developers, says McKinsey. Permitting is a nightmare process as legislation shifts, often according to the kinds of grassroots outrage popping up in response to land-use issues. As a result, permits for utility-scale solar and wind farms can often take up to ten years. Already, 31 states have passed ordinances restricting renewable expansion.
Finally, increased grid congestion poses a major threat. The energy grid infrastructure in the United States is aging, and will need massive infrastructure investments to be brought up to speed. Our grid system now is not smart enough or flexible enough to handle the dynamic and variable nature of massive-scale dependence on renewables. This will require a huge increase in energy storage technologies. “Because the stability of the power grid depends on predictability and a balance of supply and demand, the US grid is not always able to immediately integrate all new wind and solar power,” reports McKinsey. This means that finished solar projects often have to wait for months before they can actually connect to the grid. What’s more, the urban areas that need the most energy are often far away from the rural areas where these massive amounts of clean energy will be produced, requiring a huge expansion of transmission lines to bring energy to end users.
While the rapid expansion of utility-scale solar and wind projects is a long overdue necessity for meeting climate goals and avoiding the most devastating impacts of climate change, there are some serious bottlenecks that must be considered. And these will require some major politicking at a time when the country has never been more divided.
By Haley Zaremba for Oilprice.com
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