GREEN GROWTH: FROM RELIGION TO REALITY - Sustainia

Chapter 18 See Thomas Hughes’ excellenttreatment of the interaction oftechnology, social structures, andpolitics during electrification, inNetworks of Power: electrificationin Western society, "1880-1930(Baltimore: The Johns HopkinsUniversity Press, 1983) and “TheElectrification of America: thesystem builders”, Technology andPolicy 1979, pp124-161.9 Indeed, European Union EnergyCommissioner Günther Oettingerhas called for € 1 trillion in newenergy infrastructure investmentin the European Union over theperiod 2011-2020, in order to accommodatenew renewable energycapacity. See “Energy InfrastructurePriorities for 2020 and beyond– a blueprint for an integratedEuropean energy network” (TheEuropean Commission, November2010).10 Most studies of the manageabilityof high-renewable-energy systemssuggest 20% as the limit forrenewable energy penetration inthe current system. See, for instance,“Accommodating High Levelsof Variable Generation” (Integrationof Variable Generation TaskForce, North American ElectricityReliability Corporation, 2009).Denmark already obtains 20%of its electricity from renewableenergy, mostly wind. At high-windperiods, the flood of wind energyinto the power grid can destabilizethe grid and drive electricity pricesbelow zero. As a consequence,the Nordpool energy markets, ofwhich Denmark is a part, haveimposed a € 200/MWh tariff onDanish wind farm operators whodo not shut down their turbinesat periods of high energy demand.11 See, for instance, "Van Jones,The Green Collar Economy: howone solution can fix our two biggestproblems" (San Francisco:HarperOne, 2008); The EuropeanCommission, “An Energy Policyfor Europe”, Communication tothe European Parliament andEuropean Council no. SEC(2007)12, 2007; and United States PresidentBarack Obama, “State of theUnion Address”, January 27 2011."Viewed as mere source replacement, the green energyrevolution would have only a limited impact on theeconomic activity of an advanced industrial economy"electrons to power a clean energy economy. Why, then,do we speak of a transformation of the energy system,rather than a program for investment in new energysources? We would argue that source replacement alonecannot achieve the scale of renewable energy adoptionrequired for serious decarbonization of the energy supply.Moreover, viewed as mere source replacement, thegreen energy revolution would have only a limited impacton the economic activity of an advanced industrialeconomy. Technically, large shares of renewable energypose serious challenges to today’s centralized, constantload,supply-equilibrated energy supply. Economically,mere replacement would have a defined and very limitedscope, limiting further the growth prospects for replacementof cheap fossil fuels with expensive renewable energy.Thus any hope of both decarbonizing the energysupply and achieving economic growth via clean energyrequires looking at the possibilities of the broader energysystem.Technically, renewable energy poses three challengesto the functioning of modern energy systems. Today’senergy systems provide constant energy supplies throughcentralized distribution systems that treat demand as anexogenous variable. Tomorrow’s renewable energy systemsmust manage both demand and supply to accommodatethe variability of renewable energy generated bya wide range of distributed energy systems. These threechallenges together imply an energy systems transformation.They also demonstrate the importance of the powergrid to this transformation.Centralization poses the first challenge. Since NikolaTesla’s alternating current system won out over Edison,large, centralized power plants have dominated modernenergy systems.8 Improvements in long-distance transmissionnow mean that most generation plants are nowlocated far from centers of economic demand. Electricityflows almost exclusively from the plant to the center ofdemand, via a series of transmission substations.Renewable energy requires a very different structurefor the energy system. Because plants must be locatedwherever renewable resources may be found, renewableenergy frustrates any attempt at centralization. Toaccommodate distributed generation, a power grid designedaround centralized power plants must be reconfiguredto handle different inputs, of different scale, froma geographically disperse set of resources. This will requiresignificant new investment in transmission anddistribution capacity.9These investments are closely related to the secondchallenge, intermittency. Fossil fuel sources provideselectricity as stable as the supply of fossil fuels to theirboilers. This has meant a reliable, stable, dependable energysupply for industrial societies. In contrast renewableenergy resources like wind and solar are notoriously intermittent,in ways unrelated to the actual demand forenergy.10 Stabilizing the energy supply from renewableenergy sources therefore requires complementary measuresof one of two forms. Geographic diversification providesone possibility. Intermittency is very weakly correlatedover long distances: wind speed in North Dakotaand solar intensity in Arizona don’t vary in the same wayat the same time. If transmission capacity can tie togethersufficiently geographically dispersed markets, then energysupply can be averaged to match energy demand.Alternatively, a range of new energy storage solutionscan be added to the grid in order to stockpile energy generatedat times of low demand for use at times of high demand.Again, however, this requires that the power gridhave the ability to accommodate a much wider diversityof sources than it does at present, and to manage thosesources in real time against the demands of industrialsocieties. In either case, however, the problem remainsthe same: moving away from fossil fuel dependence forthe power supply will require a set of complementarychanges to the electricity grid. Source replacement alonewill not suffice to achieve a low-carbon energy systemstransformation.Whether some of these challenges can be made easierby demand management brings us to the third driver ofenergy systems transformation. Historically, the energysystem treated demand as a given and worked to providesufficiently flexible supply capabilities to satisfy it. Butmanaging demand against supply may offer both priceand performance advantages to the energy system. Ifsome forms of energy demand can be adjusted in tandemwith variability of renewable energy supplies, it could increaseboth the efficiency and the stability of the system.Such an approach would be vital to the large-scale incorporationof electric vehicles, which would simultaneouslyrepresent an enormous new demand on the systemand a huge potential pool of electricity storage.Thus three challenges—intermittency, distributedgeneration, and demand management—suggest that onlya transformation of the energy system will suffice to decarbonizethe energy supply of modern industrial societies.Source replacement alone cannot achieve the level ofrenewable energy generation required without posing seriouschallenges to the stability and reliability of the electricgrid. Taken together, this implies a threefold transformationfor energy production, distribution, and use.This transformation will require huge investmentsacross the economy. A variety of popular and policy argumentshas suggested that these investments represent thenext technological transformation of the economy, implyingmanifold new opportunities for innovation, employment,and economic growth.11 If true, the economicpossibilities they imply could more than offset the costsof investment. The “green growth” that ensued wouldturn the logic of climate change on its head, suggestingthat climate change mitigation could generate real, materialbenefits in addition to the abstract benefit of avertedglobal climate change. This would fundamentally changethe terms of debate. But how should we understand theGreen Growth: From religion to reality 7