Utility scenario predicts rosy future for renewables

PALO ALTO, California, US, April 5, 2006 (Refocus Weekly)

Wind has the potential to grow from 11 billion kWh in 2003 to 35 b-kWh by 2025, while solar can increase from 1 to 6 b-kWh, under a scenario developed by the U.S. utility industry.

The Electric Power Research Institute has unveiled four new scenarios which explore a range of technologies critical to meet future energy needs. The scenarios do not predict the future but serve as planning tools for utility executives to prioritize technological improvements.

The ‘Double Whammy’ scenario factors both high prices for natural gas and high societal concerns about environmental costs which, together, produce a “more than proportionate share in their impact on the economy.” It reflects a “significant change in beliefs and values of the majority of Americans, industry, and government leaders toward the position that anthropogenic changes in global climate are occurring, that they are harmful, and that they must be addressed soon.”

Under that scenario, six renewables are considered to be potential key technologies which, combined, would increase output from 364 b-kWh in 2003 to 491 b-kWh in 2025. Hydroelectricity is the major technology, increasing from 275 to 307 b-kWh over the period, followed by biomass (37 to 81), geothermal (18 to 33), wind (11 to 35), municipal solid waste (22 to 29) and solar PV and solar thermal (rising from 1 to 6 b-kWh over the period). Biomass includes combined heat & power and co-firing with coal, while MSW includes landfill gas.

Under the Double Whammy scenario, the initial focus is on conservation, improved end-use efficiencies, combined heating and renewables but, over time, “innovations occur that generate surprising impacts on efficiency, cost and environmental quality while delivering enhanced features.” Clean coal technologies emerge as a transition fuel leading to a zero-emission future, and nuclear also plays an important role in the generation mix of this scenario.

The scenarios explore different assumptions about the evolution of fuel prices and CO2 costs and, now that scenario frameworks have been developed, specific technical implications of each scenario will be developed and published by EPRI this summer.

Many people see opportunities to expand the use of renewables as well as advanced nuclear and advanced storage systems, and officials suggest that “many of these technologies would find wider use in the market if traditional energy technologies were paying their full cost, especially related to environmental externalities,” the report explains. “The majority of energy industry leaders are concerned about imposing such costs because it would challenge their sunk investments; nevertheless, a growing niche of business leaders in some of the biggest companies are beginning to see new possibilities and opportunities for profit in creating new energy systems and models of service.”

“The 2008 national elections prove pivotal in shifting U.S. environmental policies to a new level,” it speculates. “Following several years of destructive storms in the Southern states and melting ice caps, environmental concerns rise to the top of the political agenda” and the winning Presidential candidate challenges voters to create a cleaner future and to develop a policy that demonstrates U.S. concern over the environment.

“Consumers need time to learn about new technology options and adjust to their particular features,” it explains. “Just as cell phones went from ‘bricks’ to photo-taking flip phones over a 20-year period, new solar designs, emerging fuel cells and battery systems offer new features related to cleanliness, mobility, reliability, security and power quality.”

“Engineers accustomed to running coal plants have to learn how to match wind energy systems with hydro-based firming and energy storage services and to run chemical plants that produce gas from coal and capture CO2,” it adds. It will take 15 years for changes to make an impact but, by 2020, “long-term investments and risk taking by companies with foresight are beginning to pay off in growing earnings.”

“By this time, utility executives are boldly forecasting the end of the era of natural gas, just as they had dropped oil in the 1980s and 1990s,” and the transition to a more modern energy base is accomplished without much sacrifice in economic growth. “Market responses lead to collaboration and sustained investment in research and development of new and alternative energy products and services to meet more stringent environmental requirements. This world has a great role for nuclear energy and renewable sources and energy efficiency. Distributed generation might play a key role in a system integrated with renewables.”

EPRI was established in 1973 as an independent centre for public interest energy and environmental research. Its members represent 90% of the electricity generated in the United States.


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