Recently, Sen. Bob Smith, among the “greenest” state legislators in New Jersey, introduced the Renewable Energy Transition Act (RETA), which mandates that renewable energy and energy efficiency provide 80 percent of New Jersey’s electric generation needs by 2050, and sets up annual milestone goals to achieve that ambitious goal.
Not surprisingly, the bill () has aroused opposition from the usual suspects -- such as the ratepayer advocate, large industrial users, and Tea Party types -- who tend to oppose any clean energy initiative that might increase consumers rates, even by trivial amounts, and no matter how beneficial or needed it may be.
Their arguments can be grouped into what I call the “Seven Deadly Myths” against RETA. Here are these seven “truthy” claims, and the facts debunking them:
Myth No. 1: Because the sun doesn’t always shine and the wind doesn’t always blow, it is not technically feasible to substitute renewable solar and wind energy, combined with energy efficiency, to replace 80 percent of the state’s electric power needs by 2050.
Rebuttal: Although solar and wind are intermittent power sources, we can still depend on them.
That’s in part because improved transmission between climate zones combined with rapidly emerging electric storage systems can enable renewables to replace 80 percent or even 100 percent of power needs by 2050, according to recent studies.
A study this year by PJM, which operates the power grid for New Jersey and 12 other states, found that this incredibly complex web of power plants and transmission and distribution lines can readily absorb 30 percent renewable power by 2026 without major problem. True, PJM estimates it will need to invest $8.5 billion in system upgrades to balance renewables and keep the grid stable. While that sounds like a lot of money, when the cost is spread over 13 states and 12 years, it comes to about 0.1 cents per kilowatt-hour, barely enough to be noticed.
Myth No. 2: Even if a renewable-driven grid is technically feasible, achieving the ambitious goals in RETA would break the bank of ratepayers who must pay for upgrades in their utility rates.”
Rebuttal: The cost of solar electric panels and wind energy turbines keeps tumbling every year, as technology advances and manufacturing expands. Solar panel prices dropped 80 percent in just the last six years, and the cost of complete systems fell by more than half.
At the same time, renewables produce more than electricity. The solar generators on thousands of New Jersey roofs create value for the entire electric grid, lowering peak electric costs on the wholesale market, and producing valuable societal benefits, including avoided environmental and global warming costs and creating jobs. When these “externalites” are quantified they come to a value added of 17 cents to 22 cents per kilowatt-hour. This far exceeds the 5 cents to 10 cents extra per kilowatt-hour it currently costs to produce solar power.
Myth No. 3: The rosy stories coming out of Germany are no longer valid, since that nation’s transition from nuclear and coal has stalled and is failing on the altar of high-cost subsidies borne by increasingly reluctant ratepayers.”
Rebuttal: Germany is doing great, thanks in part to its farsighted and enormously popular commitment to replace nuclear and coal with renewables (a major employment generator, creating an estimated 370,000 jobs so far).
At the same time, the reliability of Germany’s power-delivery system keeps getting better, and makes the United States seem like a Third World country. In 2011, for example, Germany’s SAIDI (“System Average Interruption Duration Index”) -- which compares countries’ total system downtime for a year -- hit a record low of less than 15, much lower than the rest of Europe, and far better than the US SAIDI of 244.
When Prime Minister Merkel threatened to back off on the country’s ambitious commitment to renewables, she was quickly dissuaded by the public outcry, including 82 percent in a national poll saying they support the renewables transition. Germany’s wholesale power prices have tumbled to record lows, sometimes going “negative” during the day because of the solar power flooding into the grid. Best of all, Germany is not alone. Its Nordic neighbors -- Denmark, Sweden, Norway, Finland, and Iceland -- as a group had already surpassed 63 percent renewables by 2012, while their economies are humming along at growth rates equal to or exceeding that of the United States.
Myth No. 4: A more cost-effective, tried-and-true approach to combating global warming is to increase reliance on plentiful new sources of clean-burning natural gas.
Rebuttal: If only it were true. If only carbon dioxide (CO2) emissions were counted, natural gas would reduce greenhouse gases by about half, compared to coal. But a far more damaging pollutant is emitted before the gas reaches a power plant: methane, and it is 86 times to 105 times as potent a greenhouse gas as CO2 (measured over the 25-year time horizon).
The release rates of the “fugitive methane” emitted in the production and transmission of natural gas, especially from fracking, wipes out any benefits at the power production stage. As a result, the greenhouse gas “footprint” of natural gas has become far worse than from burning coal, estimated at 115 percent to 415 percent of the climate change harm caused by coal (depending on which study is quoted).
Myth No. 5: In a renewable energy future, the role of utilities will be greatly reduced.
Rebuttal: Although distributed renewables empower people to create their own energy, that doesn’t mean we won’t need utilities. Far from it. A renewable-based energy system will require investments in new utility infrastructure, including long-distance transmission and electric energy storage. Greatly expanded energy efficiency and demand-side management will be essential, and highly cost-effective, features of such a future. The two-way grid also will be much more complex to control, and to plan. To meet those challenges, utilities will be needed more, not less.
Myth No. 6: State regulators and lawmakers should back off and let the ‘free market’ determine our future energy mix. If renewables are so good, they will out-compete fossil-fuel sources without more help from government.
Rebuttal: This Tea Party line makes no sense for at least two reasons: First, every energy source -- be it nuclear, coal, oil, gasoline, natural gas, or solar -- is subject to a diverse mix of government policies. There is, in short, no such thing as a “free market” in energy; there are only regulated markets, heavily infused with a complex of subsidies, tax preferences, and restrictions.
Second, while the competitive market is good at some things, it does a lousy job at others. Importantly, it fails utterly at providing remuneration or imposing costs for many of the “externalities,” both positive and negative, associated with an energy source. Pollution, for example, is an “externality cost” of fossil-fuel power that the industry offloads onto the public, making it a form of public subsidy for dirtier sources. By way of contrast, clean and renewable energy do not receive monetary credit for the “externality benefits” they confer, such as wholesale electric price reduction, cleaner air and water, job creation, grid resiliency, and combating global warming. So long as the societal value of these benefits equals or exceeds the cost of incentives, there is no subsidy for solar.
Myth No 7: At a minimum, New Jersey should wait to see if other states go first and not take the lead in such a bold experiment.
Rebuttal: This view is the biggest copout of all. It ignores the state’s long history of worldwide technological leadership -- as the birthplace of the Industrial Revolution in the United States, the laboratory of Thomas Edison, the cradle of the computer, the place where solar systems got their start. More recently, New Jersey was a national leader in solar energy policy, which explains why at one time the state was second only to California in solar installations.
New Jersey, which is falling steadily behind its neighbors in economic development and environmental protection, can ill afford not to accept the challenge of promoting the clean energy future represented by the RETA.