When our energy cost drops – Can we still breathe?

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The cost of renewable energy is dropping worldwide. Solar energy projects have dropped in cost by 75% since 2009, however this cost is primarily due to “soft” costs which relate to project, design, efficiency and reduced cost of recruiting customers. In the past 6 years the cost of wind has dropped by 66% in the U.S. and worldwide has added 1 million jobs and $110 million to local economies in 2015.

In 2013, we reached a turning point where more renewable energy capacity is being added than fossil fuels. At the end of 2016, the price of unsubsidized solar is less than both wind and fossil fuels in some parts of the world. By 2030 it is projected that renewable energy capacity will be quadrupled.

10 MW Solar Photovoltaic Facility - St.Lucy, Barbados. Completed by the Barbados Light and Power Company in 2016

The U.S. solar industry has experienced a record-breaking 99% increase in installations between July and September 2016. This was primarily due to utility scale installations.

But does this mean that we will see a reduction in fossil fuel use and pollution soon?

Does this mean that we will all automatically pay less for our electricity?

Not for a while if we depend only on centralized electricity generation systems which underestimate the risk of fossil fuels.

If we focus on a very basic conversation, how have we managed to ignore the risk and cost of fossil fuel pollution for so long? In 2015, China experienced an air apocalypse even though they have and continue to significantly reduce coal use. Exactly which cities can we live in which will not require clean air as a prerequisite for us to live? Exactly how can we function in the present world (forget about the future), if the costs of addressing health issues worsened by air pollution swallow up our wallet and our time?

Have we managed to ignore the health costs of fossil fuel because the healthcare facilities and most other institutions which we depend on still rely on fossil fuels?

It is time that we shift this energy generation institutionalization from fossil fuels to renewable energy – the technology exists and the cost of fossil fuel is too high to continue to ignore.

Neighbouring solar and cement plants in Barbados.

The Cost to Breathe

Damages from the environmental risk of fossil fuel electricity generation are still considered a hidden cost which utility and energy investment companies continue to underestimate. In 2005 the National Academy of Sciences (NAS) published a study estimating these hidden costs at $120 billion based mainly on the health effects of air pollution from both electricity generation and motor vehicle transportation. This $120 billion cost excludes costs from climate change, ecosystem damage, air pollutants such as mercury, and risks to national security.

NAS has specifically priced the air pollution damage from SO2, NOx, and particulate matter air pollution from coal at $62 billion for 2005 or 3.2 cents per kilowatt-hour (kWh). In 2010 the cost of pollution from coal combustion was approximately $187 billion annually, or 9.3 cents per kWh. If we include the cost of illnesses, premature mortality, workdays lost, and healthcare – the public health added cost is 47 cents per kWh for coal, oil, and natural gas combined which is more than double the fossil fuel retail price in the U.S and most countries.

Even with this information, the societal and environmental risk of fossil fuels still seems to be an underestimated afterthought in our transition to renewable energy. This risk is underestimated even when it dominates press coverage in the form of being identified as the root issue of conflict and turmoil in Aleppo or an oil spill near the proposed North Dakota Access Pipeline (NDPL).

Although there was an oil spill 150 miles southeast of a heavily protested natural gas pipeline (NDPL), based on their statements to the press, investment companies remain undeterred and confident that the natural gas pipeline is worth the risk. To the confusion of many there is still a possibility that the NDPL will be completed with the changing U.S. administration.

The Science Exists

The reason for the underestimation of fossil fuel pollution and deteriorating profitability is not due to a lack of scientific studies. Risk assessment based on ecological economics and damage analysis have identified the full cost of fossil fuels historically and validated methods to continue to assess damage in the future.

The evaluation of risk and pollution from fossil fuel use has been examined and validated in a scientifically rigorous way. So what is the issue, really?

It is understandable that we won’t see an immediate reduction in pollution because of the increased renewable energy capacity. It takes time to evaluate and make a conclusion on pollution concentrations.

But why isn’t the price of our electricity immediately reduced when renewable energy is installed?

Why don’t we see immediate financial benefits especially if our centralized generations systems are primarily dependent on overseas and conflict burdened sources of oil which both result in high transportation costs and fluctuating oil prices?

To answer these questions, we need to consider how we scale out, initially where the money for this scaling out comes from and how quickly the results pay off.

So this is a conundrum, it won’t pay off until we see how it pays off.

The irony is real.

This is why even with growth in renewable energy, most of us are still stuck bearing the consequences and cost of fossil fuels.

The good news is that the “how” and “who” of renewable energy is dependent on action by multiple people, hybrid technology systems and a working equation between centralized and decentralized energy generation. Most of us live in countries with both urban and rural areas, hence the reason why both types of generation are necessary for a 100% transition to renewable energy.

It is a false dichotomy that we must choose one method of systematically transitioning to renewable energy or that we must choose one type of renewable energy technology champion. We are simply doomed for eventual failure if we hedge all our bets into one technology and this is exactly what we are doing when it comes to fossil fuels.

Fossil fuel drunk

Fossil fuel use is still heavily government subsidized and institutionalized into electricity generation systems. We are drowning in an intoxicating fossil fuel concoction and our bartenders continue to serve us round after round because we are paying for it.

But just like your bartender has no ties to you nor requirements to slow down your consumption, the good ones do slow you down - because they are responsible (and if your car crashes they will probably feel terrible).

It is time that we change the drink, incentivize bartenders effectively or serve ourselves if necessary.

- Ariana Marshall Ph.D, Clean Energy Bartender and Environmental Scientist.

......with a side of Environmental Risk Management on some days.

#renewableenergy