Opinion

The Great Debate

Renewables roll-out needs price guarantees

John Kemp Great Debate– John Kemp is a Reuters columnist. The views expressed are his own –

Power generation from renewable sources such as wind turbines, solar cells and biomass plays a small but important part in satisfying total electricity demand around the world, and is growing at an exponential rate thanks to generous public subsidies and government support.

Renewable sources have increased their share of worldwide generation from just 0.4 percent in 1980 and 1.1 percent to 2.3 percent in 2006. In its “World Energy Outlook 2008″, The International Energy Agency (IEA) projects their share will double to 4.9 percent by 2015, and then almost double again to 8.7 percent by 2030. Click here for PDF.

Policymakers are relying heavily on renewable generation to meet projected growth in the electricity demand over the next 20 years while limiting growth in the emission of greenhouse gases.

Unlike reserves of oil and gas, which may be exhausted within the next 70 years, renewables will remain a source of power indefinitely. Much the same could be said of coal, but renewables do not contribute to increased carbon dioxin concentrations in the atmosphere.

Renewables to spark U.S. grid revolution

John Kemp Great DebateGrowing power consumption and the U.S. administration’s plan to rely more heavily on renewable generation sources will increase the demand on America’s already overloaded electricity grid and require major investment in transmission and distribution networks.

Upgrading power transmission and distribution systems is likely to cost as much as installing new generating capacity over the next 20 years.

While Congress provided an extra $4.5 billion of funding for grid improvements in the recent fiscal stimulus, federal loan guarantees and other support, far more investment will be needed if the administration’s targets for renewable generation are to be realized.

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