Renewable Energy Laser Talk

Question:  How will a carbon fee help expand renewable energy?

Answer:  The price signal created under the Energy Innovation and Carbon Dividend Act will accelerate the adoption of renewables.

The term renewables generally encompasses solar, wind, hydropower, and sometimes biopower – electricity from biomass. These are all ways of getting electricity from the sun without increasing CO₂ in the atmosphere, and all are mature technologies.

Under a carbon fee, as fossil energy bears a steadily higher cost, renewable sources will be more and more attractive to electric utilities and manufacturers. With the need to electrify many of our energy needs, from the cars we drive to the way we heat our homes, the demand for climate-friendly electricity will go up rapidly.

There are still obstacles to the continuing growth of renewables. The biggest one is intermittency. The wind doesn’t always blow and the sun doesn’t always shine. [1,2] Hydropower and biomass supplies tend to be seasonal and may be vulnerable to extreme weather. One important solution for intermittency is energy storage, of which there are many competing forms, [3] but most are still not fully mature, [4] so renewables today are often backed up by natural gas plants that can be fired up quickly.

Another challenge is infrastructure. [5] Renewable resources are often located far from population centers, and the electrical grid was designed around large centralized power plants. That network has to be modernized and upgraded. Complex, outdated power markets need to be streamlined. [6] Facilities for quick, easy EV charging must be expanded. [7]

All of these changes will happen much faster under this policy, because the ‘market pull’ of a rising carbon fee creates the financial incentive to attract private investment in both tried-and-true technologies and new innovations.

This page was updated on 01/15/2019 at 10:12 CST.