A lot of recent debate has focused on renewable subsidies – how much they cost, what their value is and whether they can or should continue, writes Jerry Hamilton.
The full benefits of a thriving renewables industry will take years to realise and, to some, costly subsidies now seem hard to justify. This view is short sighted, but equally we must envision a time when subsidies come to an end. Renewable energy does no one any favours by becoming a bottomless pit for taxpayer’s money.
The rightful role of subsidies is to get a socially useful but disadvantaged market to maturity. Renewable energy generation offers the same commoditised output as fossil fuels – kilowatts hours of energy fed into your home or business. But they are years behind in terms of supply chains, R&D and infrastructure. They can compete, but they need support to get to that stage. Subsidies so far have brought us a long way towards that point, but we are not there just yet. We should continue until we are.
This presents us with a couple of questions: What do we hope to achieve from renewables? And at what point do we agree we’ve reached that point and stop subsidising them?
The first question has several answers. The most obvious is that they reduce our reliance on fossil fuels. This is not about renewables replacing fossil fuels – that will take decades. It is about getting them to a stage where they can play a viable part in the energy mix and can be supplied at a price energy companies, and ultimately consumers, are willing to pay for.
We are not yet expecting wind to compete with natural gas on a per kilowatt hour basis. But with power plants close to capacity, adding renewables to the mix can avoid the need to turn on another power station – an expensive way of dealing with a 10% energy increase each evening. In this situation, wind or solar can be very cost effective very soon.
But the advantages of renewable energy go beyond cost. It is also about energy security. Russia provides about 30% of Europe’s natural gas and in June it cut off supplies to Ukraine. As a net importer of both oil and gas, the UK is not immune to political instability in oil and gas producing nations, which could dramatically increase prices and affect our ability to keep the lights on. Having viable, home grown energy resources is critical to avoiding this, and worth paying for.
Renewables also offer consumer benefits that fossil fuels don’t. Rooftop solar panels or wind give consumers power to control their energy in the way a grid supply with a monthly bill does not. A growing understanding of our energy consumption can give consumers more control, which can in turn drive greater change through smarter energy use and a more competitive energy market – driving down costs.
Giving consumers the power and control to better understand and manage their energy usage is paramount. The ultimate goal in energy security is to move to a decentralised energy model, where energy is produced and shared amongst consumers and fed back to the grid.
Much of the resistance is about reluctance to change the way we’ve always done things. If we can encourage and incentivise people to use renewables, uptake will happen naturally. Much of the value of subsidies is getting people through that pain barrier of change without undue cost to themselves.
Which brings us to the second question – when will renewables be self-sustaining?
This is harder to answer. In some ways it is already sustainable. The government have agreed a price of £92.50 for every megawatt hour of energy produced by the new Hinkley C nuclear power station – almost twice the current wholesale cost of electricity. There is no reason it couldn’t do a similar deal for renewables – recognising the long-term need for energy security.
Equally if oil and gas prices were to shoot up or become inaccessible, renewables would suddenly become very competitive.
But in reality, renewables still have plenty of gains to be made in terms of efficiency, and of end-user acceptance.
Subsidies speed this process along. There is no definitive answer as to when to stop, but it should be once they reach a point at which they can provide energy that plays an integral part in the complete energy mix, and one accepted by a critical mass of consumers and businesses. We are probably looking at 5-15 years, depending on global energy prices, cooperativeness of the big producers, and consumer willingness to embrace and understand renewable energy.
Jerry Hamilton is director of renewables and energy solutions at Rexel UK.
Photo: Kim Hansen via Flickr
7 New Technologies That Could Radically Change Our Energy Consumption
Most of our focus on technological development to lessen our environmental impact has been focused on cleaner, more efficient methods of generating electricity. The cost of solar energy production, for example, is slated to fall more than 75 percent between 2010 and 2020.
This is a massive step forward, and it’s good that engineers and researchers are working for even more advancements in this area. But what about technologies that reduce the amount of energy we demand in the first place?
Though it doesn’t get as much attention in the press, we’re making tremendous progress in this area, too.
New Technologies to Watch
These are some of the top emerging technologies that have the power to reduce our energy demands:
- Self-driving cars. Self-driving cars are still in development, but they’re already being hailed as potential ways to eliminate a number of problems on the road, including the epidemic of distracted driving ironically driven by other new technologies. However, even autonomous vehicle proponents often miss the tremendous energy savings that self-driving cars could have on the world. With a fleet of autonomous vehicles at our beck and call, consumers will spend less time driving themselves and more time carpooling, dramatically reducing overall fuel consumption once it’s fully adopted.
- Magnetocaloric tech. The magnetocaloric effect isn’t exactly new—it was actually discovered in 1881—but it’s only recently being studied and applied to commercial appliances. Essentially, this technology relies on changing magnetic fields to produce a cooling effect, which could be used in refrigerators and air conditioners to significantly reduce the amount of electricity required.
- New types of insulation. Insulation is the best asset we have to keep our homes thermoregulated; they keep cold or warm air in (depending on the season) and keep warm or cold air out (again, depending on the season). New insulation technology has the power to improve this efficiency many times over, decreasing our need for heating and cooling entirely. For example, some new automated sealing technologies can seal gaps between 0.5 inches wide and the width of a human hair.
- Better lights. Fluorescent bulbs were a dramatic improvement over incandescent bulbs, and LEDs were a dramatic improvement over fluorescent bulbs—but the improvements may not end there. Scientists are currently researching even better types of light bulbs, and more efficient applications of LEDs while they’re at it.
- Better heat pumps. Heat pumps are built to transfer heat from one location to another, and can be used to efficiently manage temperatures—keeping homes warm while requiring less energy expenditure. For example, some heat pumps are built for residential heating and cooling, while others are being used to make more efficient appliances, like dryers.
- The internet of things. The internet of things and “smart” devices is another development that can significantly reduce our energy demands. For example, “smart” windows may be able to respond dynamically to changing light conditions to heat or cool the house more efficiently, and “smart” refrigerators may be able to respond dynamically to new conditions. There are several reasons for this improvement. First, smart devices automate things, so it’s easier to control your energy consumption. Second, they track your consumption patterns, so it’s easier to conceptualize your impact. Third, they’re often designed with efficiency in mind from the beginning, reducing energy demands, even without the high-tech interfaces.
- Machine learning. Machine learning and artificial intelligence (AI) technologies have the power to improve almost every other item on this list. By studying consumer patterns and recommending new strategies, or automatically controlling certain features, machine learning algorithms have the power to fundamentally change how we use energy in our homes and businesses.
Making the Investment
All technologies need time, money, and consumer acceptance to be developed. Fortunately, a growing number of consumers are becoming enthusiastic about finding new ways to reduce their energy consumption and overall environmental impact. As long as we keep making the investment, our tools to create cleaner energy and demand less energy in the first place should have a massive positive effect on our environment—and even our daily lives.
Responsible Energy Investments Could Solve Retirement Funding Crisis
Retiring baby-boomers are facing a retirement cliff, at the same time as mother nature unleashes her fury with devastating storms tied to the impact of global warming. There could be a unique solution to the challenges associated with climate change – investments in clean energy from retirement funds.
Financial savings play a very important role in everyone’s life and one must start planning for it as soon as possible. It’s shocking how quickly seniors can burn through their nest egg – leaving many wondering, “How long your retirement savings will last?”
Let’s take a closer look at how seniors can take baby steps on the path to retiring with dignity, while helping to clean up our environment.
Tip #1: Focus & Determination
Like in other work, it is very important to focus and be determined. If retirement is around the corner, then make sure to start putting some money away for retirement. No one can ever achieve anything without dedication and focus – whether it’s saving the planet, or saving for retirement.
Tip #2: Minimize Spending
One of the most important things that you need to do is to minimize your expenditures. Reducing consumption is good for the planet too!
Tip #3: Visualize Your Goal
You can achieve more if you have a clearly defined goal in life. This about how your money can be used to better the planet – imagine cleaner air, water and a healthier environment to leave to your grandchildren.
Investing in Clean Energy
One of the hottest and most popular industries for investment today is the energy market – the trading of energy commodities. Clean energy commodities are traded alongside dirty energy supplies. You might be surprised to learn that clean energy is becoming much more competitive.
With green biz becoming more popular, it is quickly becoming a powerful tool for diversified retirement investing.
The Future of Green Biz
As far as the future is concerned, energy businesses are going to continue getting bigger and better. There are many leading energy companies in the market that already have very high stock prices, yet people are continuing to investing in them.
Green initiatives are impacting every industry. Go Green campaigns are a PR staple of every modern brand. For the energy-sector in the US, solar energy investments are considered to be the most accessible form of clean energy investment. Though investing in any energy business comes with some risks, the demand for energy isn’t going anywhere.
In conclusion, if you want to start saving for your retirement, then clean energy stocks and commodity trading are some of the best options for wallets and the planet. Investing in clean energy products, like solar power, is a more long-term investment. It’s quite stable and comes with a significant profit margin. And it’s amazing for the planet!
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