The Cost Of Renewables Continues To Plummet
According to a new report from the Institute of New Economic Thinking at the University of Oxford, previous estimates about how quickly the price of renewables will fall have consistently underestimated reality (We think they are pointing their fingers at the International Energy Agency here.)
Here’s the first few paragraphs of the report:
“Rapidly decarbonizing the global energy system is critical for addressing climate change, but concerns about costs have been a barrier to implementation. Most energy economy models have historically underestimated deployment rates for renewable energy technologies and overestimated their costs. The problems with these models have stimulated calls for better approaches and recent reports have made progress in this direction.
“Here we take a new approach based on probabilistic cost forecasting methods that made reliable predictions when they were empirically tested on more than 50 technologies. We use these methods to estimate future energy system costs and find that, compared to continuing with a fossil fuel based system, a rapid green energy transition will likely result in overall net savings of many trillions of dollars (emphasis added) — even without accounting for climate damages or co-benefits of climate policy.
“We show that if solar photovoltaics, wind, batteries and hydrogen electrolyzers continue to follow their current exponentially increasing deployment trends for another decade, we achieve a near-net-zero emissions energy system within twenty-five years. In contrast, a slower transition (which involves deployment growth trends that are lower than current rates) is more expensive and a nuclear driven transition is far more expensive.
“If non-energy sources of carbon emissions such as agriculture are brought under control, our analysis indicates that a rapid green energy transition would likely generate considerable economic savings while also meeting the 1.5 degrees Paris Agreement target.
“Future energy system costs will be determined by a combination of technologies that produce, store and distribute energy. Their costs and deployment will change with time due to innovation, economic competition, public policy, concerns about climate change and other factors.”
“It’s not just good news for renewables. It’s good news for the planet,” co-author Matthew Ives, a senior researcher at the Oxford Martin Post-Carbon Transition Program, tells ArsTechnica. “The energy transition is also going to save us money. We should be doing it anyway.”
“Our approach is based on two key design principles: 1) include only the minimal set of variables necessary to represent most of the global energy system, and the most important cost and production dynamics, and 2) ensure all assumptions and dynamics are technically realistic and closely tied to empirical evidence. This means that we focus on energy technologies that have been in commercial use for sufficient time to develop a reliable historical record.
“We choose a level of model granularity well suited to the probabilistic forecasting methods used, i.e. one that allows accurate model calibration, and ensures overall cost reduction trends associated with cumulative production are captured for each technology. Our model design can be run on a laptop, is easy to understand and interpret, and allows us to calibrate all components against historical data so that the model is firmly empirically grounded. The historical data does not exist to do this on a more granular level.”
Omitted Technologies
“Consistent with our two design principles, we have deliberately omitted several minor energy technologies. Co-generation of heat, traditional biomass, marine energy, solar thermal energy, and geothermal energy were omitted either due to insufficient historical data or because they have not exhibited significant historical cost improvements, or both.
“Liquid biofuels were also excluded because any significant expansion would have high environmental costs. Finally, carbon capture and storage in conjunction with fossil fuels was omitted because i) it is currently a very small, low growth sector, ii) it has exhibited no promising cost improvements so far in its 50 year history, and iii) the cost of fossil fuels provides a hard lower bound on the cost of providing energy via fossil fuels with CCS. This means that within a few decades, electricity produced with CCS will likely not be competitive even if CCS is free.” (emphasis added)
Massive Storage Capacity
“Since renewables are intermittent, storage is essential. In the Fast Transition scenario we have allocated so much storage capacity using batteries and P2X fuels that the entire global energy system could be run for a month without any sun or wind. This is a sensible choice because both batteries and electrolyzers have highly favorable trends for cost and production.
“From 1995 to 2018 the production of lithium ion batteries increased at 30% per year, while costs dropped at 12% per year, giving an experience curve comparable to that of solar PV. Currently, about 60% of the cost of electrolytic hydrogen is electricity, and hydrogen is around 80% of the cost of ammonia, so these automatically take advantage of the high progress rates for solar PV and wind.”
Final Energy
“To understand these scenarios it is important to distinguish final energy — which is the energy delivered for use in sectors of the economy — from useful energy, which is the portion of final energy used to perform energy services, such as heat, light and kinetic energy.
“Fossil fuels tend to have large conversion losses in comparison to electricity, which means that significantly more final energy needs to be produced to obtain a given amount of useful energy. Switching to energy carriers with higher conversion efficiencies (e.g. moving to electric vehicles) significantly reduces final energy consumption.
“Our Fast Transition scenario assumes that eventually almost all energy services originate with electricity generated by solar PV and wind, making and burning P2X fuels or using batteries when it is impractical to use renewables directly. The Fast Transition substantially increases the role of electricity in the energy system.”
The INET report focuses mainly on the process of technological advancement, which is part of what has made renewables cheaper. Renewables have routinely performed beyond the expectations of previous papers. “They’ve been getting these forecasts wrong for quite some time,” Ives said. “You can see we’ve consistently broken through those forecasts again and again.”
Rather than a plateau on renewable energy costs, Ives said the greater likelihood is that the prices will decrease slower once things like solar and wind end up dominating the market. At that point, technological advances may very well still happen, but they might not be rolled out as frequently as they are now. “It’s the deployment that slows it down,” Ives says.
Michael Taylor, senior analyst at IRENA, agrees. He tells ArsTechnica his organization found that the cost reduction drivers — improved technology, supply chains, scalability, and manufacturing processes — for solar and wind are likely to continue at least for the next 10 to 15 years. With regard to previous forecasts, he says, “I would expect they’re overly pessimistic.”
Unforeseen issues such as the global pandemic and supply chain woes could slow the decline in the cost of renewables, as well as other barriers such as oil and gas subsidies, public opinion, permitting, and political considerations. “Just on purely economic grounds, there are increasing benefits to consumers to be had by accelerating the roll out of renewable power generation,” Taylor says. “We encourage policymakers to look very seriously at trying to remove the barriers that currently exist.”
The Takeaway
The report from the Institute of New Economic Thinking is a breath of fresh air. In particular, it explodes all the tripe being trotted out by fossil fuel companies to justify the continued use of their products. Carbon Capture? Pure baloney, a chimera they can hide behind while the continue their relentless greenwashing campaigns.
INET envisions consumers saving trillions of dollars as renewable energy takes over from thermal generation. The bottom line is we must stop burning fossil fuels as soon as possible if we want to keep the Earth habitable for humans. This report comes just in time for the COP 26 climate conference in Glasgow. In a rational world, global leaders would seize upon it as justification for moving forward aggressively with favorable renewable energy policies.
That’s unlikely. Those political leaders are beholden to fossil fuel companies, so expect a lot of rending of garments and gnashing of teeth as they try to spin their way out of the obvious. The only thing we as renewable energy advocates can hope for is that the price of renewables will get so low that anyone with the acumen of kumquat will have to recognize the truth. Ultimately, those free market imperatives reactionaries are so fond of will drive a stake through the heart of their beloved fossil fuel industry. We can’t wait!
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Hyundai Motors is recalling 145,235 EVs and other “electrified” vehicles in the US, citing concerns about a loss of driving power, the National Highway Traffic Safety Administration (NHTSA) said on Friday.
The NHTSA announced this morning that the recall affects selected IONIQ 5 and IONIQ 6 EVs, as well as certain luxury Genesis models, including the GV60, GV70, and G80 electrified variants, from the 2022-2025 model years, Reuters reported.
It looks like the issue stems from “the integrated charging control units in these vehicles, which may become damaged and fail to charge the 12-volt battery. This malfunction could lead to a complete loss of drive power, posing safety risks for drivers,” the NHTSA stated.
If you’re an owner of one of these Hyundai models dating 2022-2025, stay tuned. Hyundai has not yet provided a timeline as to when affected vehicles will be repaired.
To make that happen, the company’s dealers will inspect and replace the charging unit and its fuse if necessary, NHTSA said. Free of charge, of course.
Importantly, no crashes, injuries, fatalities, or fires due to this issue have been reported in the US, Hyundai reported.
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Tesla announced that ‘Actually Smart Summon,’ its autonomous driving feature that enables moving its vehicles without anyone inside over short distances, is now being launched in Europe and the Middle East.
The automaker’s Full Self-Driving suite of features has been limited in those markets due to regulations and Tesla’s focus on making them work in North America first.
Actually Smart Summon is the vision-only version of Tesla’s “smart summon” feature, which was released years ago on Tesla vehicles with ultrasonic sensors.
When Tesla transitioned away from ultrasonic sensors, Smart Summon was one of the missing features that Tesla had yet to adapt to the vision-only (cameras and neural nets) system.
CEO Elon Musk said that it would be coming in 2022, but it finally came only a few months ago, in 2024.
However, that’s only in North America where Tesla focuses its Full Self-Driving (FSD) development, the feature package that includes Actually Smart Summon, also referred to as ‘ASS’.
Most of Tesla’s other markets, including Europe, don’t have the same capabilities under the Full Self-Driving package. That’s partly due to regulations, but Tesla also focuses on making the features work on North American roads first.
Now, Tesla has announced that its Actually Smart Summon feature is launching in Europe and the Middle East:
The feature can only be used on private roads, like parking lots and driveways. Most people have used it to bring their vehicles parked in a large parking lot to them as they exit a store or restaurant. However, the vehicle moves quite slowly under the feature and the owner needs to keep an eye on it at all time and be ready to cancel the summon as Tesla doesn’t take any responsibility for accidents caused by using Actually Smart Summon., like all other FSD features.
Therefore, most people I know who have the feature, myself included, tried once or try to see or impress some friends who have never seen a car move without anyone inside and then stopped using it.
The feature’s main useful use-case is for people with extremely tight parking spots. It enables them to exit the vehicle before it is in its final parking spot and then move the car in and out remotely.
However, that has been the case for years with the regular Smart Summon, as you generally don’t need the vehicle to handle complex parking lots. You mostly need it to move a few feet forward or backward.
But a recent update has broken this feature for some people. We recently reported on a very unfortunate situation that resulted in a Tesla owner having to get out of his car through his trunk.
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US Automakers are planning to ask Mr. Trump to retain President Biden’s EPA exhaust rules, in the face of signs that Mr. Trump might try to reverse them. If the rules are reversed, it would cost Americans hundreds of billions of dollars and thousands of deaths per year.
Interestingly, this is the opposite of what big auto did the last time a reality TV show came to the White House – signaling that they have perhaps learned their lesson this time ’round.
First, some history.
In the middle of the 20th century, the effects of human activity on the atmosphere became readily apparent. Certain cities – with Los Angeles among the forefront – were choked by smog, and it was soon found out that vehicle pollution was the primary reason for this smog.
Since Los Angeles was one of the most smog-choked cities, California led the way on clean air regulation, creating the California Air Resources Board in 1967 (under then-Governor Ronald Reagan).
The federal government gave California special dispensation to set stricter regulations than the rest of the country, in recognition that it had a unique smog problem in its primary metropolis. California has retained this dispensation, in the form of a “waiver,” since then. And other states can follow California’s rules, but only if they copy all of the rules exactly.
Thus, there have been two separate sets of clean air regulation in this country since then – the federal rules, and then the “CARB states” which follow California’s rules.
In 2012 that finally changed, when President Obama’s EPA negotiated with California to finally harmonize these standards and also implement higher fuel efficiency nationwide. This would have been a huge boon for both industry and consumers, saving money and giving regulatory certainty to the auto industry.
But then, in 2016, the candidate who got the 2nd most votes in the presidential election was headed for the White House. And automakers responded by immediately lobbying to torpedo these standards, even before inauguration.
Now, you might think that asking a profoundly ignorant individual, who ended up staffing the EPA with bought-and-sold science deniers (huh, that would never happen again would it?), to change rules which had already been set through years of negotiation and lobbying was not a great idea. And you’d be right.
Not long after automakers had the dumb idea to ask an idiot to fix something that wasn’t broken, that idiot went and broke things further, fracturing the agreement between California and the federal government and ensuring less regulatory certainty for automakers.
After realizing their blunder (which they could have avoided by, y’know, thinking at all about it beforehand), big auto relented and asked the government to please not implement the rollbacks automakers had asked for. Some companies even forged their own agreement with California.
But it was too late, and we are now back in the era of disparate regulatory regimes – something which John Bozzella, head of the Alliance for Automotive Innovation (formerly called Global Automakers), keeps complaining about these days, despite having lobbied for exactly this in the first place.
The US EPA and California are still not fully harmonized, but both released recent new standards which do have somewhat similar targets. If a manufacturer builds towards one set of rules, they’ll probably not be too far off from meeting the other.
So in the end, we did get better emissions regulations and California has continued to push forward with clean air regulations, thus signaling a failure on the part of Mr. Trump to cause the long term harm to Americans that he and his oil industry solicitors so desperately seem to desire.
The most recent EPA standards, finalized in March (after being softened at the auto industry’s request), do not mandate any particular powertrain, but rather require steep emissions cuts – and EVs are the easiest way to achieve lower emissions.
Notably, Tesla lobbied in favor of making this last set of standards stronger, and they also lobbied against ruining the Obama/CA standards in 2016 – being one of very few automakers who were on the correct side of that discussion.
Despite that the President Biden EPA’s rules do not mandate any particular powertrain, Mr. Trump, in his usual ignorance, has said that he will end the nonexistent EV mandate. And now that he has received more votes than his opponent for the first time (after three tries, and despite committing treason in 2021 for which there is a clear legal remedy), it looks like the upcoming EPA might be directed to end these emissions cuts and fuel/health cost savings for Americans.
But in this instance, it sounds like the automakers might actually do the right thing for once, and ask the government not to do any rollbacks, and instead let them continue on with the plans without disruption from a convicted felon who seems determined to cede a US EV manufacturing boom back to China.
Detroit’s Big Three automakers – GM, Ford and Stellantis – are all reportedly trying to figure out how to ensure that these rules stay in place. The mentality is that constantly changing regulations are not beneficial for companies – particularly in the auto realm, where models take on the order of 7 years to plan and execute. Long-term planning is important for the hundreds of billions in manufacturing investment that EVs have attracted in the US during Biden’s EV push.
These attitudes are notable, given that this is not what automakers did in 2016/2017. That time, they compulsively pushed for fewer regulations, and now they are asking for regulations to remain in place.
It’s further notable that Tesla CEO Elon Musk, whose company lobbied strongly in favor of emissions cuts and makes more use of the federal EV tax credit than any other company, is now allied with the very entity that’s looking to harm EVs. It seems that we have entered opposite world.
So it remains to be seen where we will go from here – on the one hand, doctors, nurses, scientists, environmental groups, many businesses, people who recognize that they have lungs which they would like to continue using, and so on, generally support the strongest regulation possible. Now, automakers have been added to the pile asking for strong regulations.
On the other hand, a former reality TV host – tagged along with by the CEO of the company that has sold more electric cars than any other – seem determined to kill electric cars, despite the harm that would cause to Americans’ pocketbooks and health insurance premiums. And that famously vindictive character may be even more spurred towards this harmful course of action after failing in his efforts the first time.
Who ya got?
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