IntroductionU.S. energy production from renewable sources was 10.7% of total energy production in 2010, up from about 7.6% in 1970. Total renewable energy production was 8,064,000 billion BTUs (up from 7,761,000 billion BTUs in 2009). In this case, “renewable” includes conventional hydroelectric and geothermal, along with solar, wind and biomass. Meanwhile, nuclear generation accounted for 11.2% of total U.S. energy production, or 8,440,000 billion BTUs.
Analysts at BP report that renewable power consumption grew by 15.5% worldwide in 2010, 12.6% in 2009 and 15.4% in 2008. However, this impressive growth does not mean that renewables account for a large amount of consumption. Instead, renewables as a percent of global energy consumption were about 1.3% in 2010, about double the rate of 0.6% in 2000.
Globally, in 2010, sources for worldwide generation of electricity included about 16% hydroelectric; 16% nuclear; and 2% “renewables” including waste, wind, geothermal and solar. Coal remains a primary source of electric generation in many parts of the world.
Wind power has seen rapid growth worldwide. Major technological advances in wind turbines (including much larger blades creating very high output per turbine, and blades that suffer very little downtime and are thus more efficient) and massive government incentives encouraging investment in wind generation have fueled wind turbine installation. In the U.S., wind power generation grew dramatically from 29,007 billion BTUs in 1990 to 258,385 billion BTUs in 2006 and 924,000 billion BTUs in 2010. The Global Wind Energy Council estimated total wind generation capacity worldwide at 74,052 megawatts in 2006, and forecast it to climb to 459,000 megawatts by the end of 2015. However, it remains to be seen whether financing can be found for that much expansion.
Solar power is enjoying significant technological innovation. The most important factor in solar is the percent of captured solar energy that is converted into electricity, and that ratio is climbing. The use of polymers is leading to exciting, flexible solar panels, and nanotechnology is creating breakthroughs in solar technology as well. The International Energy Agency reports that installed global solar photovoltaic capacity was 4,184 megawatts at the end of 2005 within the IEA Photovoltaic Power System Program Member Countries. By 2010, that number had soared to 40,000 megawatts.
Biomass energy (including the use of energy from waste and the production of bioethanol) has been growing rapidly as well, both in the U.S. and elsewhere. The U.S. Department of Energy reports that biomass accounted for 53.4% of all renewable energy consumption in America during 2010.
As for nuclear power, we are entering an era in which the construction of new nuclear generating plants will most likely accelerate rapidly in China and India, where demand for electricity is booming and dozens of new nuclear plants are planned. Several new plants are also planned in the UAE, and South Korea may require several new plants. However, the early 2011 destruction by a tsunami of multiple nuclear reactors at Fukushima, Japan makes it much less likely that we will see a rebound in nuclear plant construction in America or Europe any time soon.
It should be noted that the use of renewable sources does not always mean clean power generation. For example, burning wood or trash for energy under the wrong conditions can create significant pollution. Also, the clearing of land, such as rain forests, for planting for biomass to be used in ethanol or biodiesel refining can be highly destructive to the environment while creating huge quantities of carbon emissions. In addition, many types of renewable energy production require vast quantities of water.
In the U.S., emphasis on alternative energy and conservation has a varied history. The 1973 oil trade embargo staged by Persian Gulf producers greatly limited the supply of petroleum on the market and created an instant interest in energy conservation. Thermostats were turned to more efficient levels, solar water heating systems sprouted on the rooftops of American homes (including a system that was used for a few years at the White House) and tax credits were launched by various government agencies to encourage investment in more efficient systems that would utilize less oil, gasoline and electricity. Meanwhile, American motorists crawled through lengthy lines at filling stations trying to top off their tanks during the horrid days of gasoline rationing.
While some consumers maintained a keen interest in alternative energy from an environmentally friendly point of view, most Americans quickly forgot about energy conservation when the price of gasoline plummeted during the 1980s and 1990s. Gasoline prices as low as 99 cents per gallon were common for many years. As advancing technology made oil production and electricity generation much more efficient, a low commodity price trend kept market prices under control. As a result, Americans returned to ice-cold air-conditioned rooms and purchased giant, gas-guzzling SUVs, motor homes and motorboats. The median newly constructed American single-family home built in 1972 contained 1,520 square feet; in 2005 it contained 2,434 square feet. More square footage means more lights, air conditioning and heating to power. Meanwhile, federal and state regulators made efforts to force automobile engines and industrial plants to operate in clean-air mode, largely through the use of advanced technologies, while requiring gasoline refiners to adopt an ever-widening web of additives and standards that would create cleaner-burning fuels.
Fortunately, the first energy crisis in the early 1970s did lead to the use of technology to create significant efficiencies in some areas. For example, prior to that time, as much as 40% of a typical household’s natural gas consumption was for pilot lights burning idly in case a stove or furnace was needed. Today, electric pilots create spark ignition on demand. Likewise, today’s refrigerators use about one-third the electricity of models built in 1970. Many other appliances and electrical devices have become much more efficient. While the number of electricity-burning personal computers proliferated, computer equipment makers rapidly adopted energy-saving PC technologies.
Today, fluctuating oil and gas prices, along with tax credits and other incentives, have created a renewed interest in all things energy-efficient. Smaller cars, high-efficiency homes and solar power are once again part of popular culture. At the same time, renewable energy sources and cleaner-burning fuels are of great appeal to the large number of American consumers who have developed a true interest in protecting the environment. For example, surveys have shown that some consumers would be willing to pay somewhat more for electricity if they knew it was coming from non-polluting, renewable sources.
Hybrid gasoline-electric automobiles made by Toyota and Honda are selling well in the U.S. “Clean diesel” cars that deliver very high mileage are extremely popular in Europe, and diesel cars made by Volkswagen and Mercedes are increasingly popular in America. Meanwhile, many municipalities, such as the city of Seattle, Washington, are investing in buses and other vehicles that are hybrids or run on alternative fuels such as natural gas. Plug-in hybrid electric vehicles, and fully electric cars, are slowly being introduced.
Alternative energy is also attracting rapidly growing interest from investors. Globally, venture capital has helped to support innovation at firms that focus on alternative energy or energy conservation technologies. Likewise, national governments are helping to fund many energy efficiency projects, ranging from fuel cell research to the design and development of high-efficiency buildings.
Legislation at state and national levels will continue to boost renewable energy development and conservation technologies on a global basis. In the U.S., state governments have passed stringent legislation requiring that an ever-growing percentage of electric generation come from renewable means. In Washington, D.C., the Obama administration has major programs in place to boost federal funding of renewable energy and conservation measures.
However, when analyzing plans, announcements and developments in renewable energy projects, it is best to keep an eye on a big challenge: where will the money come from? The global financial crisis of 2008-09 made money much more difficult to raise for organizations, corporations, utility firms and local governments. Many alternative and renewable energy projects were delayed or abandoned.
Nonetheless, renewable energy remains a viable business for the long term, as long as government support holds out. Meanwhile, technologies with a reliable return on investment, such as hydroelectric, remain extremely desirable. Conservation through advanced materials and technologies, such as retrofitting existing buildings with more efficient windows, insulation and air conditioning, is popular as long as a reasonable return on investment can be shown.
Alternative oil sources, such as oil sands and oil shale, harbor vast potential reserves, but it is a challenge to produce them at reasonable prices per barrel of oil equivalent. Canada’s oil sands industry has grown to massive size, and operators have learned how to increase efficiency.
Bioethanol and biodiesel, from an economic and environmental point of view, are questionable at the least, and extremely misdirected at the worst. Some production of bioethanol appears very efficient, particularly in Brazil where sugar cane is the feedstock. However, the diversion of corn and soy from the food chain to the energy chain for ethanol or biodiesel may be a very bad idea. Advanced technologies that capture carbon dioxide and utilize it to grow oil-producing algae appear to be a promising alternative.
At least two geothermal energy projects, where deep holes are drilled to tap the high temperatures of the inner Earth, have recently been cancelled due to concerns that these activities cause earthquakes. Tidal energy looks promising, but both installation costs and maintenance remain huge obstacles.
The bottom line is that most types of renewable energy production simply cannot exist without substantial government investments, incentives, loans and/or tax breaks. Hydroelectric is the rare exception, as it produces power at very low cost. In nearly all other cases, large-scale projects based on solar, wind or wave power can only be funded through high levels of government support. Consumers of such power will pay much higher rates for electricity, either directly through their power bills or indirectly through their taxes. It remains to be seen whether technologies in these fields can advance to the point that these renewable power sources can be economically viable on a self-sustaining basis.
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Video Introduction to Renewable & Alternative Energy Industry