
In few years renewable power may become a better economic option - dgudkov
https://www.weforum.org/agenda/2018/01/renewables-will-be-equal-or-cheaper-than-fossil-fuels-by-2020-according-to-research
======
ghouse
They already are less expensive in areas that have the specific resource. For
example, in windy parts of the world, wind is the least expensive. In sunny
parts, solar is the least expensive. This is without subsidies.

With specific subsidies, the area where they are less expensive is even
larger.

Of course, fossil fuels receive considerable direct and indirect subsidies,
further complicating answering the question "what's least cost?"

~~~
CountSessine
_Of course, fossil fuels receive considerable direct and indirect subsidies_

This is the received wisdom of the clean energy movement, but every report
I’ve read says otherwise. Oil and gas receive little if no operational
subsidies in most countries and in fact are heavily taxed at every stage of
exploitation. Even government investments in oil and gas typically return far
better than the risk-free rate, which is remarkable for government.

Of course there are some terrible externalities that we don’t price in...

~~~
joshuahaglund
I googled coal subsidy and this is the first result.

There's a lot of tax credits and subsidies. "Clean coal" for instance, or 3.4
billion for carbon sequestration (did that get past the lab yet?)

[https://www.taxpayer.net/energy-natural-resources/coal-a-
lon...](https://www.taxpayer.net/energy-natural-resources/coal-a-long-history-
of-subsidies/)

~~~
Kaidera
So even combining every possible subsidy given to the coal industry since 1950
they still only get a total of $72 billion of subsidies in present value.
Given that coal's current contribution to GDP is ~$50 billion and the coal
industry was larger in the past its pretty fair that the subsidies are
completely insignificant and probably don't exceed 1% of the industry's
economic value.

So subsidies for coal are incredibly small.

------
DennisP
That'd be great but the word "storage" does not appear in this article. For
wind/solar to truly be cheaper than fossil, the cost of storing enough energy
to get through a few windless nights has to be included.

Backing up by natural gas doesn't count; natural gas is a fossil fuel and if
you take methane into account it might even be worse than coal.

Hydro and geothermal don't need storage but they're also geographically
limited. We can't expand them arbitrarily the way we could expand wind/solar.
This also means using hydro to store energy from wind/solar can only go so
far.

None of this matters in the near term, since we can certainly expand
wind/solar a lot before we run into problems. But over the next several
decades we need to replace fossil entirely.

~~~
pdonis
_> natural gas is a fossil fuel and if you take methane into account it might
even be worse than coal_

Huh? Natural gas only produces about half the CO2 per unit of energy that coal
does.

~~~
CydeWeys
The point is that natural gas (also known as methane) can leak out into the
environment during production and distribution, and methane is a very potent
greenhouse gas, 30X as bad per mass.

So if burning methane only produces half the CO2 per unit of energy, but just
2% of it leaks into the atmosphere at any point in the production/distribution
pipeline, then it's actually worse.

~~~
quotemstr
Methane has a relatively short half-life in the atmosphere, only 8.6 years,
which means that over the long term it's not that potent a GHG versus long-
lived CO2 (about 100 years, but it's complicated). The radiative forcing alone
doesn't tell the whole story.

~~~
DennisP
Yes but it's not only direct forcing over the long term that matters. Push the
planet hard enough in the short term, and we'll kick off positive feedbacks
that take things several degrees further with no more help from us. The exact
threshold is unknown but it's thought to be about two degrees C over
preindustrial.

~~~
pdonis
_> Push the planet hard enough in the short term, and we'll kick off positive
feedbacks_

Which have never actually been observed. The whole "positive feedbacks" thing
is based on computer models which have been falsified by the actual data.

~~~
DennisP
No, it's based on extensive geological evidence. See Hansen's book for
details.

Besides that, it's based on the fact that we're already seeing things like
polar ice melt and emissions from permafrost.

~~~
pdonis
_> No, it's based on extensive geological evidence._

We don't have accurate enough geological evidence to support the kinds of
"positive feedback" claims that are being made. Hansen's book lays out a
partisan case.

 _> we're already seeing things like polar ice melt and emissions from
permafrost._

What were these things doing a thousand years ago? Five thousand years ago?
Ten thousand years ago? We don't know. And that means we don't have the data
to put what we're currently seeing in proper perspective. And nobody is
claiming that we do: as I said, the claims of possible disaster based on
positive feedback are based on models, not data. And the models have been
falsified by the data.

~~~
DennisP
I take it you've read his book then? Could you point out specifically what's
wrong with his evidence?

It seemed pretty convincing to me, since there were multiple independent lines
of evidence that all pointed to the same conclusion.

~~~
pdonis
_> I take it you've read his book then?_

No, I've read scientific papers on the topic, his and others. I don't trust
what is said in books on science for lay people; I've caught too many
scientists misrepresenting the science when they write for lay people, because
they know they can get away with it (and not just in climate science--I've
caught physicists doing it about general relativity and basic QM, which are a
lot more solidly nailed down by evidence and controlled experiments than
climate science is).

~~~
DennisP
Ok. Tell me something he gets wrong, and why it's wrong.

------
tokenadult
I hope there is further work on renewable aviation fuels, as vehicle fuels in
general will be a big source of demand for fossil energy extraction for quite
a while, and especially for aviation applications.

"Renewable energy in transport" report by IEA (.PDF)

[https://www.iea.org/media/training/presentations/Day_2_Renew...](https://www.iea.org/media/training/presentations/Day_2_Renewables_5_Transport.pdf)

~~~
AnthonyMouse
Ground transportation is a much larger component than aviation and has known
solutions. If we got to 80-100% electric cars and trucks before converting one
turbofan to <unknown alternative> it would still be major progress.

And in the worst case there are always biofuels or synthetic non-fossil liquid
fuels, which are a lot more carbon neutral after you convert the energy that
goes into their production away from fossil sources.

~~~
sp332
Right, now that ground transportation is close to being solved, we need to get
creative with air travel. It's about 2% of global emissions and it's a much
harder problem.

~~~
sjwright
Hybrid electric jet engines are being developed, and have real potential to
improve fuel economy. A substantial improvement in fuel economy could mean
carrying less fuel, which in turn improves fuel economy.

But if you’re talking about plug-in electric, the challenge is presumably
battery weight versus fuel weight.

~~~
sp332
Yes, they'll still probably have to carry liquid fuel because nothing else has
the energy density required. But maybe we can make this fuel from a carbon-
neutral source instead of oil pumped out of the ground.

------
hnzix
_" The stone age did not end for a lack of stone, and the oil age will end
long before the world runs out of oil."_ S. Yamani

~~~
whatshisface
The Energy Information Administration estimates that the US has 234*10^9
barrels of oil in reserves (unproven but technically recoverable). At today's
rate of production that's about 64 years. S. Yamani's quote sounds very likely
to come true.

[0]
[https://en.wikipedia.org/wiki/Oil_reserves_in_the_United_Sta...](https://en.wikipedia.org/wiki/Oil_reserves_in_the_United_States)

~~~
quotemstr
The volume of "technically recoverable" oil increases with price though, since
a higher cost per bbl can justify more expensive extraction. Somewhere around
$70-$100 bbl, shale oil becomes economical to extract, and the US and Canada
have trillions of barrels worth of the stuff.

We're never going to run out of oil in the sense that oil will become
unavailable, not in 64 years, and not in 640 years. Oil _will_ become more
expensive, and eventually, price increases will diminish and eventually stop
the use of oil as an energy source. It'll always be available for use as an
industrial feedstock and for use in highly specialized situations.

~~~
Retric
The issue is 200+$ a barrel oil is mostly useless.

The world runs on _cheap_ oil, not just oil. And the supply of cheap oil is
finite.

~~~
quotemstr
I don't agree that $200/bbl oil would be useless: there's plenty of room at
that price point for aviation and industrial chemistry. But it doesn't matter,
because there are trillions of barrels of unconventional oil available at
between $80-$100/bbl. That's expensive, but not infeasibly so. Short-lived
supply shocks notwithstanding, there's no reason oil should rise above that
price for a good long time.

~~~
njarboe
What hopefully will happen is that electricity from non-fossil fuels will
become cheap enough and technology will become advanced enough that humans can
create hydrocarbons from the air and water (CO2 and H2O) at a price that keeps
those trillions of barrels in the ground. Or at least lets us stop burning
them.

~~~
quotemstr
Sure. The simultaneous trends toward cheaper low-emission sources and more
expensive fossil fuels will force a switch at some point. We'll also need
negative emissions (i.e., atmospheric carbon removal) at some point too.

Now, will it be more expensive to keep drilling and remove the emissions than
it will be to cook long-chain hydrocarbons? It's not clear. And it doesn't
really matter, since either way you can hit a carbon target.

------
BurningFrog
Then we can only hope people will continue to be greedy, and global warming
should go extinct!

------
marcoperaza
Great if true, but color me skeptical.

Almost anytime there is a story like this, the fine print is that renewables
are only “cheaper” because of government subsidies. Is that the case here?

Also, cheaper in some situations (e.g. hydro power for purchasers right next
to a dam) does _not_ mean cheaper when scaled to a whole country. Is that the
case here?

~~~
ghouse
Globally, conventional fossil fuels receive greater subsidies (nominally, not
$/MWh) than renewable power. Estimated to be up to $6 trillion when
considering indirect subsidies [1] and $260 billion when only considering
direct cash subsidies [2].

[1]
[https://www.sciencedirect.com/science/article/pii/S0305750X1...](https://www.sciencedirect.com/science/article/pii/S0305750X16304867)
[2]
[https://www.iea.org/newsroom/news/2017/december/commentary-f...](https://www.iea.org/newsroom/news/2017/december/commentary-
fossil-fuel-consumption-subsidies-are-down-but-not-out.html)

~~~
mikeash
Coal alone kills a million people a year worldwide. If we take the EPA's value
of a statistical life of about $10 million, that's effectively $10 trillion in
subsidies just for coal deaths.

We don't typically consider being allowed to pollute to be a subsidy, but we
really should.

~~~
travisoneill1
$10 million per person fails the sniff test

Global GDP per capita: $17,300 Global life expectancy: 72 72 * 17300 =
$1,245,600 upper bound

~~~
mikeash
Sure, that’s the “if.” Although even the monetary value of a life is probably
more than just the economic contribution.

------
ibatindev
That's a wonderful news but damn, that image by IRENA Renewable Cost Database
it's awful.

~~~
rossdavidh
My thoughts exactly. A repeating axis that goes "2010-2017-2010-2017"? It
would be difficult to make it less intuitive.

------
scythe
Unfortunately renewable energy economics has to fight against the way that
human minds perform time discounting. A wind energy product may be more
economically efficient over its lifetime, but a coal-firing plant costs less
today, even if fuel costs will add up over time. So these encouraging numbers
may not obviate the case for government action in encouraging the uptake of
renewable energy.

------
rossdavidh
This is, on balance, great news. However, when it happens, nations like Saudi
Arabia and Russia (that depend on oil revenue) will encounter a cataclysmic
change in their situation. Are we actually ready for a world in which Saudi
Arabia and Russia have cratering economies? It could get ugly.

~~~
CitizenTekk
I agree with this. But on the contrary, nations like Saudi could also go with
the trend and opt in to using renewable energy such as solar as same goes to
Russia. One must adapt to changes in order to allow balance. But yes, as we
know, it will come with risk, much as been said, fossil fuel is also one of
the things that deteriorate our environment and leave a mark. They either can
have less the usage of fossil fuel or reserve it as for larger market such as
aviation fuels or with in a large scale of industries and reduce as day to day
usage basis.

------
Someone1234
Subsidized renewables or at full cost?

~~~
diafygi
Full cost. The investment firm Lazard puts out an annual report on the LCOE
(levelized cost of electricity, e.g. subsidies removed), and this past year
wind was cheaper than natural gas[1].

[1]: [https://www.lazard.com/media/450337/lazard-levelized-cost-
of...](https://www.lazard.com/media/450337/lazard-levelized-cost-of-energy-
version-110.pdf)

~~~
Kaidera
That is absolute nonsense. It excludes intermittency and integration costs.
Just from skimming it almost every variable chosen is favorable to renewables
and the worst possible case for fossil fuels.

The notion that solar is cheaper than coal as a peak power source in a
developing nation like india with significantly higher costs of capital is
laughable.

~~~
diafygi
Hmmm, I feel like your sources of information are years out of date. Care to
elaborate on your sources?

First, intermittency and integration costs are a huge straw man because they
aren't a problem until you get well over 50% penetration of non-dispatchable
generation (e.g. renewables)[1]. For the first 50% of the transition, solar or
wind by themselves are way way cheaper[2], and by the time batteries are
needed at scale, they will be cheap enough to make dispatchable renewables
cost competitive[3].

Second, India is currently building way more solar than coal[4]. Also, they
are expecting solar + storage to be cheaper than coal within 8 years[5]. So
your assertions about India are way out of date.

I'm a bit worried why you still believe the renewable intermittency is a
problem or why coal is cheaper. Your "laughable" confidence is likely to lead
to you completely missing out on the profits from deploying renewables and
storage. Oh well, I guess more money for me then.

[1]:
[https://users.ece.cmu.edu/~smithv/docs/renewables_sgc_2013.p...](https://users.ece.cmu.edu/~smithv/docs/renewables_sgc_2013.pdf)

[2]: [https://about.bnef.com/blog/tumbling-costs-wind-solar-
batter...](https://about.bnef.com/blog/tumbling-costs-wind-solar-batteries-
squeezing-fossil-fuels/)

[3]: [https://www.bloomberg.com/news/articles/2018-10-09/how-
the-w...](https://www.bloomberg.com/news/articles/2018-10-09/how-the-world-s-
biggest-ev-market-delivered-a-lithium-superpower)

[4]: [https://cleantechnica.com/2018/08/13/62-of-capacity-added-
in...](https://cleantechnica.com/2018/08/13/62-of-capacity-added-
in-q2-2018-in-india-came-from-solar/)

[5]: [http://www.climatechangenews.com/2018/02/23/coal-india-
repor...](http://www.climatechangenews.com/2018/02/23/coal-india-report-finds-
renewables-will-substantially-decrease-coal-demand/)

------
marviel
Well, that's great, surprising news.

------
briandear
Nuclear is a better economic option already.

------
empath75
The only thing that’s going to fix global warming is making carbon based fuel
prohibitively expensive through some kind of carbon tax.

Energy demand is fairly elastic and if energy is free or cheap, people will
just use more of it, leaving us just where we started. See how bitcoin miners
are abusing subsidized renewable energy for example.

~~~
quotemstr
I don't think we should worry about the total quantity of energy consumed. The
wonderful thing about the market is that it finds its own level: once
externalities are properly Incorporated into prices, the quantity produced and
consumed (which must be idential at equilibrium) will settle at a level that
priorities competing concerns appropriately. Who's to say that this
equilibrium level is somehow wrong?

And what's wrong with miners using cheap electricity? The argument seems to go
something like "that subsidy is meant for productive activity and Bitcoin
mining isn't productive". Who's to say it isn't productive? The market things
it is. What is the market getting wrong? What externality is it not
incorporating?

~~~
empath75
It doesn't matter net if some people switch from fossil fuels to renewables,
and then somebody else starts using the cheaper fossil fuels for some marginal
economic activity that's now feasible with lower fuel costs.

