A different perspective on energy
It is sometimes good to look beyond the shores of our tiny island to gain some perspective on important issues such as energy.
The excellent article in the Deloitte Insight titled Global Renewable Energy Trends — Solar and Wind Move from Mainstream to Preferred by Marlene Motyka, principal in Deloitte Transactions and Business Analytics LLP, Andrew Slaughter, executive director for the Deloitte Centre for Energy Solutions, and Carolyn Amon, manager with the Deloitte Centre for Energy Solutions, is just such an opportunity.
This opinion piece is a series of quotes from these highly qualified and well-informed authors.
“Having only recently been recognised as a ‘mainstream' energy source, renewable energy is now rapidly becoming a preferred one. A powerful combination of enabling trends and demand trends, evident in multiple developed and developing nations globally, is helping solar and wind to compete on par with conventional sources and win.”
The first enabler: “Renewables are reaching price and performance parity on the grid and at the socket. Ahead of projections and despite lingering perceptions to the contrary, wind and solar power have become competitive with conventional generation technologies across the top global markets, even without subsidies.”
• “As wind and solar capacities grow, many conventional sources will start operating at lower capacity factors, causing the levellised cost of energy of both existing and new-build conventional projects to increase.”
• “Australia and Europe have more residential and commercial rooftop solar than utility-scale solar capacity, raising the prospect of distributed versus utility-scale solar-plus-storage becoming the defining energy resource competition when grid and socket parity are reached.”
• “One of the most often cited obstacles to the deployment of solar and wind energy has been their intermittency. The situation is reversing: wind and solar may soon cease to appear as problems to be solved, but rather as solutions to grid balancing.”
• “In global practice, the deployment of solar has flattened midday price peaks, while wind has lowered night-time prices.”
• “Three quarters of the top 20 US solar and wind states have electricity prices below the US national average; one quarter is among the nation's ten states with the cheapest electricity, including the wind leader, Texas.”
• “With the addition of storage, wind and solar become more dispatchable, eroding the long-held advantage of conventional energy sources. While the cost of renewables plus storage is higher, they can provide capacity and ancillary grid services that make them more valuable.”
• “Renewables combined with storage are also reaching price parity as lithium-ion battery costs have fallen nearly 80 per cent since 2010 and solar penetration has increased.”
The second enabler: “Solar and wind can cost-effectively help balance the grid. Indeed, renewables have not been as difficult or costly to integrate as anticipated. What's more, they have demonstrated an ability to strengthen grid resilience and reliability and provide essential grid services.”
• “Most countries and regions are at renewable penetration levels that require minimal adjustments to the grid: renewables either barely register at the system level or require only small changes in operating practices and in the use of existing resources.”
• “In countries or regions with a high penetration of renewables, requiring more complex systemic changes, conventional energy sources are adjusting to enable more renewables to be integrated cost-effectively.”
• “Traditional generation plants [are used] to provide additional flexibility and stability.”
• “US states with the fewest outages are among the top solar and wind states. Over the past decade as wind production increased 645 per cent in Texas, the state's grid reliability metrics significantly improved.”
• “Wind and solar can become important grid assets. Intermittent renewables are already helping to balance the grid.”
The third enabler: “New technologies are honing the competitive edge of wind and solar.”
Automation is dramatically cutting time and costs for solar and wind production and operations. Artificial intelligence fine-tunes weather forecasting to optimise the use of renewable resources. The case for blockchain is compelling for energy attribute certificates.”
• “FirstSolar automated its US manufacturing plant last year and tripled the size of its panels at a cost that undercut its Chinese competitors by 30 per cent by transforming production from a hundred-step, multi-day process to one that takes just a few steps and hours.”
• “In July, the world's largest offshore wind farm deployed fully automated drones and cut the inspection time from two hours to 20 minutes.”
• “Looking ahead, crawling robots currently under development will enable automated microwave and ultrasonic inspections of the internal structure and materials in solar panels and wind turbines.”
• “Automated processes collect troves of data that AI can help analyse for predictive and prescriptive purposes.”
• “AI fine-tunes weather forecasting to optimise the use of renewable resources. Weather forecasting is a key component in the integration of renewables because weather shapes the availability of wind and solar resources, as well as their consumption.”
• “National forecasting systems in the leading solar and wind markets have integrated AI and driven significantly improved accuracy and cost reductions for operators.”
• “One of the clearest use cases [for blockchain] is energy attribute certificate markets — predominantly renewable energy certificates in the United States, and Guarantees of Origin in Europe.”
• “EACs are conceptually simple: each energy attribute credit certifies 1MWh of tradable renewable electricity generation.”
• “By providing a shared and trusted master list of all transactions, blockchain obviates the need for registry providers, brokers and third-party verification.
“These trends will likely continue to strengthen through two mutually reinforcing virtuous circles. The deployment of new technologies will help further decrease costs and improve integration.
“Meanwhile, the demand for renewables is inexorably growing. Solar and wind power now come closest to meeting three energy consumer priorities: reliability, affordability, and environmental responsibility.”
“In leading renewable markets such as Denmark, supranational, national and local community interests are aligned on these goals. In others, such as the United States and Australia, where the national leadership is retreating on decarbonisation efforts, cities, communities and corporations have become the most relevant actors. They have stepped up to fill the vacuum and demand has continued to grow.”
Judging from the overwhelming support for the Bermuda Better Energy Plan in the 890-plus submissions to the Regulatory Authority of Bermuda's Integrated Resource Plan public consultation, the demand for renewables is inexorably growing in Bermuda as well because energy-consumer priorities line up with the reliability, affordability and environmental responsibility offered by renewable energy.
“The case for renewables has never been stronger.”
• Nick Hutchings is a member of the Bermuda Environmental Sustainability Taskforce's energy committee