New analysis finds that best combo will generate ‘Super Power’ enabling new industry and jobs while creating trillions in new value
LONDON and SAN FRANCISCO, Oct. 27, 2020 (GLOBE NEWSWIRE) — By 2030 electricity systems comprised entirely of solar, wind and batteries (SWB) can provide both the cheapest power available and two to three times more total energy than the existing grid in the continental United States, and most populated regions globally, bankrupting coal, gas and nuclear power companies and slashing consumer costs dramatically, according to a new report by RethinkX.
“Rethinking Energy 2020-2030: 100% Solar, Wind and Batteries is Just the Beginning” finds that the dramatic cost reductions in clean energy generation and storage technologies will drive a rapid and inevitable disruption of the sector. A 100 percent SWB system will possess much more generation capacity than used on most days currently, which will produce an enormous amount of electricity at a marginal cost close to zero. The report authors show that this “Clean Energy Super Power” will enable new business models and industries, create trillions in new value, and could help repatriate energy-intensive manufacturing.
“The implications of this clean electricity disruption are profound,” said internationally renowned energy expert Tony Seba, RethinkX co-founder and report co-author. “Not only can it solve some of society’s most critical challenges but it will usher in hundreds of new business models and create industries that collectively transform the global economy. When a system generates hyperabundant electricity at a marginal cost close to zero, the potential for new value creation is limitless. This isn’t a problem of overcapacity. This is a Super Power solution.”
“There is a misconception that too much solar and wind energy is a problem,” said Dr. Adam Dorr, report co-author. “That is looking at the equation through the old fossil fuel system lens, and doesn’t recognize the fundamentals of disruption. Sunlight and wind are free, and it is irrational to curtail the nearly costless clean energy we produce with them. As with other technology disruptions, it is a mistake to ask how the existing system will accommodate SWB. The grid as we know it will rapidly evolve into a larger, more flexible, diverse and capable system, just like the landline telephone network evolved into the Internet. Instead we must ask, ‘how can a new energy system based on SWB minimize costs and maximize benefits at every level of society and the economy?’”
Tony Seba and RethinkX have been consistently more accurate in predicting the speed, scale and impact of disruption than mainstream analysts and think tanks, which take a linear extrapolation and silo-ed approach to their analyses. RethinkX uses the Seba Technology Disruption Framework, which takes into account the systemic, complex and dynamic nature of disruption.
Using conservative SWB technology cost trajectories and constraining assumptions, excluding energy imports, arbitrage, tech breakthroughs, subsidies, efficiencies and other improvements, the report analyzes three electricity systems: California, Texas and New England (see findings below), which together provide a representative range of the combined solar and wind resources in the continental United States, and most populated regions globally.
The analysis shows that there is a fundamental cost tradeoff between energy generation and storage capacity that follows a convex cost function, which the authors call the “Clean Energy U Curve.” Optimizing for this nonlinear curve, 100 percent SWB systems are the cheapest option for new power generation, and, in many cases, cheaper than just the cost to operate existing fossil fuel and nuclear plants. And they will generate surplus electricity, or super power, on most days. In California, for example, super power output of 309 terawatt-hours from the lowest-cost 100 percent SWB system is greater than total existing electricity demand of 285 terawatt-hours. The investment to build a 100 percent SWB system for the continental U.S. would be less than $2 trillion between now and 2030, and will deliver an average cost of electricity generation nationwide under 3 cents per kWh if 50 percent or more of the system’s super power is utilized. This is less than the average cost of continuing to operate existing coal or gas power plants.
The amount of super power produced by 100 percent SWB systems is so large and so cheap that it could displace up to half of all fossil fuel energy use beyond the existing electric power sector alone. Combined with electric vehicles, a 100 percent SWB system could eliminate all fossil fuel use and greenhouse gas emissions in the road transportation sector as well, cutting half of the country’s overall carbon footprint by 2030.
This report is the first in a series to examine the decisions required now in order to maximize the extraordinary benefits of a new energy system.
“It is no longer a matter of if the SWB disruption of energy will happen, it is only a matter of when and where,” James Arbib, co-founder of RethinkX, said. “Timing matters and the social, economic, political, and environmental stakes could not be higher. The actual outcomes depend on choices made today, and those who lead rather than follow or resist will benefit the most.”
RethinkX is an independent think tank that analyzes and forecasts the speed and scale of technology-driven disruption and its implications across society. We produce impartial, data-driven analyses that identify pivotal choices to be made by investors, business, policy and civic leaders.