Tuesday, June 2, 2009

More on distributed vs. central renewable energy

Stefan Gsänger, Secretary General of the WWEA, had trouble adding a comment under my recent post about Dr. Czisch's plans for wind power from Africa, so I told him I would answer in a new post. Here are his comments:
Indeed we should be well aware of the pros and cons of our strategies and long-term visions. Obviously citizens and small and medium sized enterprises have been the main drivers in renewable energy deployment to date. Without them, only little progress has been achieved, as you can see in the UK or in Egypt, for example. What role do such groups play in Gregor's scenario? Can they still be drivers? Can such a scenario even support the development of such structures in North Africa and in the end still strengthen civil society and democracy? What impact does the grid parity of PV and small wind turbines have - will Europeans want to import at all electricity?
I did in fact speak with Czisch about all of these questions except civil society and democracy, which was totally foreign to the discussion at the seminar. In fact, the inclusion of civil society and democracy in a discussion about renewable energy is something you will hardly find in the US, which has mainly focused on large wind farms rather than the community-driven projects common in Germany. So I suppose Czisch is actually more in tune with mainstream thinking than Gsänger and I are.

I hope I represent him accurately below.

Czisch is the kind of renewables proponent who would do very well in the US. His focus is almost entirely on costs (and overcoming intermittence), and if we keep in mind that T. Boone Pickens has been talking about putting up several thousand megawatts of wind turbines on his own, then we realize that Americans are not impressed by Germany's performance, which they see as pecking. A number of US investors in wind projects have told me that it is simply not economical to put up a handful of turbines here and a handful of turbines there like the Germans are doing. You have to have economics of scale, they say.

So I am sure he would say that Egypt and the UK could easily overtake Germany's scattering of turbines quite quickly with proper utility-scale wind farms. And he would be right in saying so.

Obviously, with no community involvement in such large projects, the question of democracy never arises. In discussions about RPSs and net-metering, Americans do not seem to realize that they could not only have the option of buying green power, but also of producing it.

Czisch is in line with mainstream US thinking when he says we can basically forget about solar in terms of cost -- it will never get as cheap as the best wind sites, which is why he does not include it as more than a sliver of his pie, and then only provided that the cost of solar drops eightfold. As many Americans will tell you, let's just wait until the cost gets competitive...

Importantly, Czisch is also not convinced by the grid-parity argument, and his response is one we had better get used to hearing since grid parity is around the corner (expected in a few areas in only a few years and in many areas by 2015). Czisch says it does not make sense to talk about grid parity because renewables also need the grid. He says the only fair comparison is the cost of generation (Stromgestehungskosten); in other words, if coal plants can generate electricity for four cents per kilowatt-hour, that is the figure that solar and wind have to compete with, not the retail electricity rate.

We may very well end up with Czisch's vision, or at least something quite like it. It certainly makes sense to have these HVDC lines, and the grid in the US is in sore need of repair, having been built so long ago over such a vast country.

But I think the lesson for those of us who truly support distributed power generation is that we have to stress that citizen involvement is important. We need to allow people to have input in how their infrastructure is provided, and we need to allow them to put their money where their mouth is -- without turning them into philanthropists by not giving them a fair return on their investment.

We have so much unnecessary crap (I sure do) in Western society that I simply cannot understand the notion that we should somehow be getting the cheapest energy possible. Obviously, we have to keep costs in check, but if there are some other benefits to society, then those arguments have to be made as well.

So I'm on your side, Stefan. I just wonder if Czisch can have his projects alongside ours (and vice versa).

1 comment:

  1. I am tempted to answer again:

    There is an increasing interest also in North America in community power, as we saw during our WWEC2008 in Canada and now with the first feed-in law adopted in Ontario, followed shortly afterwards by Vermont. And the wind industry in the US should be aware that the development has just begun - today's wind capacity may only represent 1% of what will be installed in the country in the future. This means that soon the wind farms will come closer to where people are living. Less huge desert space will be available for huge wind farms. And already today people in some parts of the US have started to complain about the wind farms. Here we know, starting from the Danish experience, that people owning shares in wind farms have a much more positive attitude towards them. A recent study in Scotland compared a community and a utility owned wind farm and came to the same conclusion.
    Hence in the long term there is no alternative to more community wind power, be it the UK, in Europe, North America or at other places around the world. Economies of scale in this context has a completely different meaning - small may not only be more beautiful, but the only feasible approach.