Energy Transition and Disruption

Bill Maclay on November 17, 2014

The rapidly evolving revolution in power generation, storage, and distribution.

The rapid transformation in renewable energy technologies and plummeting costs for renewables, generation, storage, and distribution systems is now revolutionizing the global energy sector as powerfully as the Internet, social media, and other recent high technology sectors. It is also transforming our energy infrastructure and delivery to the greatest degree in the last century. The shift to renewables with the decentralized generation of renewables is changing the century old energy utility model with centralized power generation. While power companies have been solar panelstrying to stop this trend, market forces continues to drive the evolution to a global decentralized energy system.

Global examples and trends

By way of example, the German government has subsidized the wind and solar industries to the extent that China has entered both markets and has led to the drop in renewable costs below fossil fuels. Importantly, Germany has accomplished this solar benchmark while maintaining the most competitive energy rates in the European Union – disproving the argument that renewable subsides increase energy costs. As is summarized in the September 13, 2014 NY Times article, Germany is only third globally when looking at percentage of renewable production of power from renewables. In recent years, renewables account for over 20% of German’s energy production. Brazil is first with over 80% and Canada is second with over 60% renewable generation. The US is in 9th place globally with about half the percentage German renewable power.  However, even in the US, states like California have renewable energy goals of 33% by 2020 and appear to be headed towards that goal. The second largest US homebuilder, Lennar Corporation, has picked up on this opportunity and is providing solar photovoltaic on all of their new homes with a 20 year contract guaranteeing a 20% discount from utility rates. This is a further demonstration that net zero and renewables are financially prudent today. (Gillis) For further details on these US, German, and global trends follow this NY Times article. While this decentralized renewable trend gains momentum, most US utilities are trying to buck the trend by controlling the market under the old and outdated centralized model.

Renewables and Vermont

However, in Vermont, as the Burlington Free Press reported on in these two articles (September 4, 2014 and windturbineSeptember 14, 2014), the city of Burlington is moving with the times by supplying 100% renewable powered electricity to the entire city of 42,000. The Burlington Electric Department will source 1/3 of its power from wind contracts, 1/3 from hydro (including a new local 7.4 megawatt plant and Hydro-Quebec), and 1/3 from a city owned biomass electric generation plant. Burlington is likely the largest community to reach 100% renewably sourced electricity. Burlington joins the likes of the Washington Electric Cooperative, which became 100% renewable this year and has about 11,000 customers. In addition, Vermont’s largest utility, Green Mountain Power has been a national leader in encouraging renewables such as wind, solar, hydro, biogas and biomass. The renewable future is increasingly obvious in all of this, but who the winners and losers will be in this “disruptive” transition is yet to be seen. That said, utilities in Vermont are leading the way.

Reference article:

Gillis, J. (2013). Sun and Wind Alter Global Landscape, Leaving Utilities Behind. The New York Times

Post written Bill Maclay on November 17, 2014 in Behavior change,Buildings & Environment,Renewable energy

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