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Energy is a basic need, yet the world relies primarily on polluting and exhaustible fossil and atomic energies. Consequently, we are faced with three essential geopolitical challenges: local security of energy supply; global depletion of conventional energy resources; and climate change. A solution for these problems is the speedy development of renewable energies. Renewable energies have been a shining star in some national economies and global investments are now exceeding US$50 billion/year with the creation of hundreds of thousands of new jobs. An overview of the current positioning of renewable energies is given here.
THE CASE FOR RENEWABLE ENERGY PROMOTION
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PV plant of 8.4 MW installed in 2007 in |
The potential for renewable energies (RE) to provide the world with clean, inexhaustible, and decentralised energy that is accessible to all is now generally accepted. The UN/IPCC report of early 2007 called for immediate action to alleviate climate change before it becomes irreversible. Renewable energies are perfectly placed to help in this action as they emit no greenhouse gases or atomic waste. And with most experts agreeing that fossil fuel resources, with the exception of coal, will be used by the middle of this century, REs offer an inexhaustible replacement.
The challenge is tremendous, requiring in not more than 50 years the complete restructuring of the current energy system that stands for a global business of trillions of dollars. And in the case of global change, we are running out of time. The limitation of fossil resources is already affecting today’s price markets. The oil price that leads the market price of all fossil energies, for example, was over US$90 in October 2007 – many times more than just a few years ago. For atomic energy the trend is similar with the price of fissile Uranium increasing in the past six years by a factor of 10. Prices for RE, however, are decreasing thanks to the economy of scale facilitated by a globalisation of the energy markets.
Many renewable energies are already competitive in today’s markets, eg solar water heaters in China, biofuels for transport in Brazil, passive solar gains in buildings and wind energy in Germany. In a few years, predictions are that market based competition will swing in favour of REs across the board and those political incentives, so important now, can be phased out.
Energy security is another area where REs come out on top. The sun shines everywhere and wind resources are widespread, whereas most of the world’s oil and gas reserves are in the ground of the Gulf States.
THE RE SHARE IN TODAY’S ENERGY MARKETS
Power generation
In 2007, 20 per cent of all investments in the global power sector went to RE power. Large hydro and the ‘new’ REs (eg in order of market share: wind power, small hydro, bio power, PV) together slightly exceed the overall capacity of all nuclear plants. Renewable energies also develop much faster than atomic power plants. In 2006, six atomic plants were taken from the grid and no new ones added, whereas 15 gigawatts (GW) of new wind capacity were installed worldwide, a €20 billion business.
Wind power
Global wind capacity reached 74.3 GW at the end of 2006, a tenfold increase since 1996. Two-thirds of the world’s wind capacity (48.6 GW) was installed in Europe, 28 per cent in Germany. During 2006 15 GW of new wind capacity was installed and, with 2.4 GW, the US took over the leadership as the largest wind market for new installations from Germany. The total German wind capacity in July 2007, however, covered almost seven per cent of the country’s net electricity consumption.
Today’s wind technology is highly mature with extraordinary progress being made in recent years. Market prices vary in the range of €1,000/kW and are unlikely to come down in the future. On top of the turbine price, there is around 30 per cent for installation costs and 4.8 per cent for operations and management. The optimal economic size for wind turbines corresponds to between 1.5 to 3 MW for physical reasons, with the majority of machines sold on the market falling in this range. Rotor diameters will be between 60 and 90 metres with tower heights ranging from 60 metres to the world record of 200 metres.
Virtually all wind turbines are currently deployed on land with offshore wind farms still in their infancy. By the end of 2007, globally installed wind power capacity will reach between 90 and 100 GW. Order books of the wind industry are currently full with virtually all wind turbines sold out. By 2011, observers expect a world market of over 200 GW.
Small hydro (units of less than 10 MW)
The world leader for small hydro is China with 38 GW in operation. (In 2006, global operations for small hydro stood at 60 GW.) In the European Union the installed capacity is 11.7 GW producing ‘normally’ 44 terawatt hours (TWh). Italy has the European leadership in this field.
Compared to the wind sector, market growth rates in the EU are small with capacity by 2015 possibly reaching 13 GW. China foresees at least 100 GW production by 2020.
Bio power
Bio power today represents over 40 GW of global capacity. It comprises different sectors, such as co-firing of wood in coal plants or dedicated bio power plants, small cogeneration plants employing vegetable oils and biogas plants feeding into power generators with Germany the world market leader in both vegetable oil cogeneration and biogas. In early 2007, 1,660 plant oil micro CHPs were in operation in Germany along with 3,260 biogas units.
Finland, followed by Sweden and Germany, is the lead country for solid biomass (logs, wood chips, pellets, sawdust, straw and crop residues). In 2005, the EU generated 44 TWh of electricity from solid biomass with three-quarters of this energy generated in cogeneration CHP plants. This sector shows an impressive growth rate of 16 per cent between 2004 and 2005. To these 44 TWh, a further 10.7 TWh can be added from the renewable part of municipal solid waste.
Photovoltaics
Solar photovoltaics (PV) are semiconductor plates that convert radiation directly into electricity without any moving parts. Market PV expansion has been so explosive that precise figures are not available, only approximations. Currently, seven GW of PV are in operation, a seven fold increase with respect to 2004. Germany has the largest share of that capacity (a third), followed by Japan and California.
In 2006 the global market accounted for around 2.5 GW with half of that installed in the EU. The global PV business exceeds €10 billion annually. Approximately 300,000 new jobs have been created in the past few years in this new sector with the industry developed by billions of Euro in investments.
Today’s global PV market is booming with modules sold out currently in 2007. A bottleneck is the availability of the silicon feedstock, the same that is used in semiconductor chips. Silicon is currently being sold at 10 times its production cost, resulting in alternative thin-film PV cells aggressively entering the world market. By 2010 when the quantity of silicon feedstock on the market will have quadrupled, silicon solar cells may be less embattled than now.
PV modules currently cost a little less than 3€/Watt on today’s world markets. With the technologies available to us now, costs of 1€/Watt are around the corner. PV will then be able to achieve market competitiveness for electricity production from building integrated PV generators. Predictions see hundred of GW of PV installed around the globe in the long term.
Combined with battery storage, PV is ideally suited for independent power generation, such as in remote villages for lighting purposes and communication. Fifteen per cent of world production goes to these kind of applications in developing countries.
Concentrator solar power plants
Most solar power plants employ parabolic mirror troughs for solar concentration; other types are solar tower plants. Recently a number of 50MW solar plants have been built, with a few of these being built in areas with bright sunlight, such as the deserts near Las Vegas, Andalusia, and the Algerian Sahara.
Geothermal power
In 2007 9.7 GW of global capacity were in operation, an increase of 10 per cent over 2005. In the EU there is 863 MW capacity which generates 5.7 TWh. Almost all of this is in Italy.
Renewable biofuels for transport
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| A bioethanol production plant in Brazil. |
The EU has fixed a target of 5.75 per cent biofuels contribution in the transport market by 2010 and 10 per cent by 2020. For years the Common Agricultural Policy of the EU was plagued by overproduction of food and set aside regimes had to be introduced. At that time, solar advocates had proposed farming energy crops as an additional activity without success. In 2007 things have changed dramatically. Prices for cereals and sugar have soared on the global markets and farmers see biofuels as a new opportunity.
At current world market prices, cereals and sugar beet have become expensive feedstocks for bioethanol production. Now, second generation bioethanol produced from wood via gasification and Fischer-Tropsch synthesis is being developed, but will be expensive. Another hope will be the development of alternative crops, such as the highly productive sweet sorghum. The other biofuels market segments are the vegetable oils and the derived biodiesel. These are grown with highest productivity as palm oil in South-east Asia leading to rising concern that forests are being cleared to give way for new plantations.
Solar heat collectors
In 2007 the global park of solar heat collectors amounted to 200 million m2. Half of this surface area is installed in China with 10 per cent in the European Union and five per cent in Germany. In China, 200 million people benefit from solar heat; it will be 300 million by 2010. Europe expects to double its surface to 40 million m2 by that time. Unlike in Europe, China’s solar hot water systems are not subsidised.
Geothermal heat
Under the leadership of Hungary, Italy and France, the EU had a thermal capacity of 2.5 GW in 2006. Market growth rates are low. At the same time, Europe counted 600,000 low enthalpy geothermal heat pumps with an overall capacity of 7.3 GW (thermal). Unlike direct geothermal heating systems, the market for heat pump based geothermal grew an impressive 20 per cent between 2005-2006.
Bioenergy
In 2005, Europe consumed 58.7 million tonnes of oil equivalent (TOE) of bioenergy in the form of logs, pellets, chips, straw, residues and black liquor, a 5.6 per cent growth over 2004. France, Sweden, and Germany are the lead European countries. The market is expected to grow to 100 million TOE by 2010.
Passive solar buildings
Low energy houses and passive solar architecture, coupled with solar collector integration, has one of the highest potentials for renewable energy utilisation. In October 2007, California energy regulators adopted the target that all homes built after 2020 must produce at least as much energy as they consume through advanced insulation and solar power, one of the many examples currently being promoted around the globe.
Beyond individual buildings, whole communities and cities must become sustainable in terms of energy consumption by deploying renewable energy. The new ‘Masdar’ city currently being built by Lord Norman Foster in Abu Dhabi is such an example.
OUTLOOK
Renewable energies have benefited from significant market development over the past few years, which is encouraging for the future. New RE mass markets will rapidly accelerate their competitiveness with conventional energies. But the challenges ahead are tremendous, with China aggressively developing the new coal plants for power generation, making it the world’s largest CO2 emitting country in two years. There is also every chance that the world will endeavour to consume all remaining oil and natural gas resources to the last droplet.
The European Union has adopted the ambitious goal of tripling its RE share over the next 13 years to 20 per cent. As far as the US is concerned, new initiatives for more RE implementation are coming forward. Beyond the current administration’s 20 per cent biofuel share target in transport by 2017, the US Senate has unanimously adopted a resolution establishing a 25 per cent RE share by 2025 as a national energy goal.
What is needed most now is raising awareness about RE facts and figures and their unique role in controlling climate change. The alternative is simply a world in jeopardy that we leave to the next generation.
Author
Wolfgang Palz holds a PhD in physics and was for 20 years (1977-97) an EU official in charge of the European Union’s research and development of all REs. In 1997 he developed the target figures for RE implementation in Europe by 2010 and is currently Chairman of the World Council for Renewable Energy (WCRE). He is based in Paris. Wolfgang Palz has won a number of awards including the European Awards for merits in Photovoltaics, Wind power and Biomass and an Order of Merit of the Federal Republic of Germany.
Organisation
The World Council on Renewable Energies (WCRE) is a not for profit, non-governmental international organisation with the goal to promote renewable energies. Its secretariat is in Bonn.
