Global Energy Markets Reach Tipping Point Giving Renewables an Edge
Global energy markets are reaching a tipping point. A pathway has opened for climate progress, but only if governments, business and public recognize and exploit the opportunity.
For the first time, a large fraction of the world's fossil fuels could be replaced at a lower cost by clean energy, with today's renewable technologies and prices. And virtually no further investments in fossil fuels make long-term economic sense because higher fossil fuel prices over their useful life will be exorbitant.
For the first time, a large fraction of the world's fossil fuels could be replaced at a lower cost by clean energy. Photo courtesy of Shutterstock
Early awareness of that reality is driving major energy growth markets to look past the fossil fuel monopoly of the 20th century. The newly elected, pro-business Indian government of Narendra Modi, as its first policy initiative, promised to provide roof-top solar to 400 million off-grid citizens. Modi is also slashing fossil fuel subsidies with their skyrocketing fiscal and trade deficits from imported coal and oil. The Chinese government signaled its intent to cap overall CO2 emissions in its next five-year plan.
The private sector is joining in. Barclay's Bank recently downgraded the entire U.S. utility sector in fear that it would not respond to the disruptive challenge of distributed solar. Global banks are abandoning their intended financing of a major coal port at Abbot Point in Australia. International oil companies, after binging on ever more expensive and extreme oil plays pulled back sharply, as mega-project after mega-project was cancelled or delayed. "We have to curb costs, as we can't count on oil and gas prices' continuing to rise," Total's chief executive Christophe de Margerie told investors. Total was joined by BP, Chevron, Shell, Statoil. Even giant Exxon sold off its major investments in U.S. light-tight oil.
The latest Bloomberg New Energy Finance projection suggests that two-thirds of incremental global power generation over the next 15 years will come from renewables. Declines in coal use in developed economies will be sharp enough to cut the global share of fossil fuels from 64 percent today to only 44 percent in 2030.
Until recently transportation was different—there were no cheaper clean alternatives to oil except for shifting from road to rail. But the electric vehicle revolution, partnered in the U.S. with cheaper shale gas, means that oil at $110 a barrel is no longer the cheapest fuel—EV's, natural gas and ethanol are already cheaper for the driver. Goldman Sachs projects that with intelligent policy support—not subsidies—40 percent of the U.S. light duty fleet would be EV's by 2050, with internal rates of return above 15 percent.
While these sound like large numbers, they are clearly inadequate from a climate perspective—worse, they are far lower market shares for clean energy than least-cost economics would warrant. The Bloomberg power projection, for example, still leaves the world investing $2.6 trillion in fossil fuel electrical generation, mostly natural gas in the U.S. and coal in Asia. Bloomberg expects that coal will increase its market share in the Indian and Chinese power sectors—even though it would be cheaper for these countries to move towards renewables much more rapidly, because wind and solar will be cheaper at the margin than coal and gas for most of the lifetime of any new power plants built in the future.
In country after country, fossil fuels still retain market share no longer justified by cost—the precipitous drop in the price of renewables, accompanied by the escalating marginal cost of extracting oil, gas and coal, have created a fundamentally new market dynamic in which fossil fuels hold on in spite of the fact that they are more expensive, not cheaper.
These "renewable edge" markets are now much bigger than the current renewable share. Electricity currently provides only one percent of global transportation energy; EV's and rail could today replace the first 15 percent of the oil used by cars and trucks at with an internal rate of return higher than 15 percent. Fossil fuels generate 63 percent of the world's power, renewables less than 5 percent, but one-third of fossil electricity now costs more than competing wind and solar. Older, outmoded coal plants, along with electrons generated by oil, LNG and marine coal no longer make economic sense. Profitable building retrofits would cut fossil fuel used for heating and cooling by 20 percent, and displace another 15 percent of fossil fuel electricity demand.
Fossil fuels are thus no longer the lowest cost energy source in enough of the world's energy markets to enable disruptive clean energy technologies to scale at a rate which would give them overwhelming market-wide competitive advantages in a relatively short time frame—if markets responded competitively to price signals. But incumbent energy markets may not in fact harvest much of this renewable edge, because they are not price driven.
Why are investors poised, according to Bloomberg, to put $2.6 trillion into new fossil fuel power plants? Why is the oil industry still investing $674 billion a year in looking for new, and increasingly unaffordable, reserves? Why is investor behavior lagging price signals?
There are several factors. Advanced energy markets are quasi-cartels, and incumbent fossil interests obstruct market transitions. American public utilities are waging war on their own customers who choose cheaper rooftop solar, seeking to tax them out of the market. Or try buying $3.00 E85 instead of $4.35 gasoline for your flex-fueled vehicle at an Exxon station.
In emerging markets raw energy is not enough—new infrastructure must be built to get that energy to consumers reliably when they need it—transmission lines, substations, pipelines, refineries. Hard infrastructure must be accompanied by complex administrative and economic mechanisms—rate regulation, credit arrangements, pollution standards, land use and leasing regimes.
The problems posed by renewables—generation intermittency, surface leasing rules for wind and solar farms, net metering—are not necessarily more difficult than those posed by base-load coal plants—fuel supply and storage, pollution damage or labor stoppages, grid failures, inability to meet peak afternoon loads. But the problems associated with fossil fuel energy are old problems, with established solutions and the security of being "proven." Disruptive clean energy solutions pose new kinds of challenges. Ossified energy bureaucracies would rather deal with intractable old problems, rather than wrestle with potentially much easier but innovation-dependent new ones.
(It is remarkable how often the "intermittency" of solar power is cited as a barrier to its growth in India by people who routinely back up their local grid with diesel, in a country where the biggest brown-out risk is on hot summer afternoons when solar is at its most reliable, and where almost any local solar array is more reliable).
And, the economic chatter of market fundamentalists notwithstanding, market lag is normal. For example, most analysis suggests that solar or wind should only displace coal or gas as investment choices AFTER they become cheaper and "grid parity" is achieved. That's logical if you were building a power plant that could be equally well fuelled by wind, sunlight, natural gas or coal—buy the cheapest fuel today. But if you build a fuel-specific power plant based on today's costs, and it operates for 20 years, you can easily blunder, because you have to pay tomorrow's much higher cost for fuel most of the time, as Japanese importers of Qatari LNG are doing today under their old contracts.
Here's a chart that shows that risk:
This chart contrasts the costs of building a solar vs. natural gas plant in 2012, operating it for 25 years, assuming that grid parity occurs in 2017. A solar power plant costs the same $0.18 for the whole life of the project. A gas plant starts cheaper—at $0.155—but gradually climbs with the price of gas and inflation to $0.25 by the end of its life. The red area—savings from cheaper gas power for the first five years—are dwarfed by the light pink area—savings from cheaper solar power for most of the project life. In most markets parity between clean and fossil energy is projected to occur within 7-8 years. Infrastructure lasts for 25. So almost no new piece of fossil dependent energy infrastructure—vehicles, power plant, transmission line and building—will pay off on a lifetime cost basis.
Market true-believers may argue that this could not be true—if solar plants would generate cheaper electrons in India over a 25 year period Indian utilities would build them. But that version of market efficiency is preposterous. The world is cluttered with bankrupt projects built on the basis of outdated assumptions about the future. What is true is that companies—or countries—who see the clean energy revolution and act on it sooner will have much better balance sheets in 15 years than those who stick with a sinking fossil ship.
It's time for climate advocates to start pointing out what the data makes obvious—with no price on carbon, clean energy should still be replacing fossil fuels as fast as we can get it built—and future investments in new coal plants, or finding new $120 oil—are going to be stranded assets, whatever the world does about climate change.
We aren't asking for sacrifice—just common sense.
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By Zahida Sherman
Cooking has always intimidated me. As a child, I would anxiously peer into the kitchen as my mother prepared Christmas dinner for our family.
Falling in Love With Food All Over Again<p>Slowly, through my most intimate relationships with friends and partners, I began to see the beauty — and rewards — of cooking.</p><p>I got tired of giving in to defeat and always bringing chips or paper products to social gatherings. I started asking my mom to send me her Christmas and Thanksgiving recipes. I even volunteered to host Thanksgiving dinner at my place.</p><p>Each time I heard my loved ones sing the praises of the foods I prepared for them, I felt a tinge more confident that I could carry out our traditions my way.</p><p>In reaching out to other relatives for their favorite recipes, I learned that they had a little help of their own. They didn't rely solely on their ancestral cooking instincts. They turned to Black chefs for guidance.</p><p>These 7 cookbooks by Black chefs have inspired my family and fed us in nutrients, joy, and spiritual sustenance. They're also helping me overcome my personal fears of cooking.</p>
Get CookingWhether you're in recovery from cooking fears like me, or are just looking to expand your culinary confidence with dishes honoring Black heritage, these Black chefs are here to support you on your journey.Turn on some music, give yourself permission to make mistakes, and throw down for yourself or your loved ones. Glorious flavors await you.
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By Tara Lohan
The conclusion to decades of work to remove a dam on the Middle Fork Nooksack River east of Bellingham, Washington began with a bang yesterday as crews breached the dam with a carefully planned detonation. This explosive denouement is also a beginning.
The History<p>The Middle Fork Nooksack drains glacier-fed headwater streams that run off the icy summit of 10,778-foot Mt. Baker. The Middle Fork joins the North Fork and then the mainstem of the Nooksack River, which travels to Bellingham Bay and Puget Sound. The entire Nooksack watershed stretches 830 square miles across Washington and into British Columbia.</p>
A Plan Comes Together<p>The Middle Fork dam is not a pool dam built for water storage. Much of the time, water flows over the top until dam operators drop a floodgate to divert water to new locations. That water travels about 14 miles through tunnel and pipeline to Mirror Lake, then Anderson Creek, and to Lake Whatcom before finally being delivered to residents' taps.</p><p>Before removing the dam, engineers had to move the water intake 700 feet upstream and situate it at an elevation that still enabled city water withdrawals throughout the year, regardless of flow conditions.</p><p>They also needed to make sure that the rushing water didn't sweep up fish and accidentally send them through the water-supply system.</p><p>"The solution required a fairly complex design in the intake structure, including a fish exit pipe out of that structure to put fish back into the river in a way that meets current environmental permit standards," explains LaCroix.</p>
Project layout for the removal of the Middle Fork Nooksack diversion dam and rebuilding of water intake. City of Bellingham<p>Despite the cost and the work, she says, being able to continue to meet their municipal water obligations while opening up habitat for threatened species has been a win-win.</p><p>"I think there's a lot of benefits to having a dam removal versus fish passage — the main one being that you get a free-flowing river that can be a dynamic ecosystem and change over time," she says. "A static fish ladder just can't provide that same level of ecosystem benefit."</p>
Restoration Success<p>Despite local authorities' championing dam removal on the Middle Fork, the project has largely flown under the radar, overshadowed in the Pacific Northwest by heated discussions about a much larger potential project — removing <a href="https://www.seattletimes.com/seattle-news/feds-reject-removal-of-4-snake-river-dams-in-key-report/" target="_blank">four federal hydroelectric dams on the lower Snake River</a>, a major tributary of the Columbia River.</p><p>Proponents of dam removal there see it as the best chance for recovering threatened salmon populations, including Chinook, which could help starving Southern Resident killer whales. Those dams also provide irrigation water, barge navigation and hydropower, so there's been more pushback against removal efforts.</p><p>Previous dam removals around the country, however, have proved successful at aiding fish recovery and river restoration.</p><p>Most notably the 1999 demolition of <a href="https://therevelator.org/edwards-dam-removal/" target="_blank">Edwards Dam on Maine's Kennebec River</a> restored the annual run of alewives, a type of herring essential to the food web. The fish run has gone from zero to 5 million in the two decades since dam removal. Blueback herring, striped bass, sturgeon and shad have also extended their reach. And the resurgence has brought back osprey, bald eagles and other wildlife, too.</p><p>The overwhelming success of river restoration on the Kennebec helped to spur a nationwide dam removal movement that's now seen 1,200 dams come down since 1999. Last year a record <a href="https://www.americanrivers.org/conservation-resource/a-record-26-states-removed-dams-in-2019/" target="_blank">90 dams</a> were removed in 26 states, including <a href="https://therevelator.org/cleveland-forest-dam-removal/" target="_blank">20 dams in California's Cleveland National Forest</a>.</p>
Spider excavators remove on dam on San Juan Creek in California's Cleveland National Forest. Julie Donnell, USFS<p>The results have been seen in the Pacific Northwest, as well, which boasts the largest dam removal thus far in the country. In 2011 and 2014, the demolition of <a href="https://therevelator.org/elwha-dam-removal/" target="_blank">two dams</a> on Elwha River, which runs through Washington's Olympic National Park, opened up 70 miles of habitat that had been blocked for a century. Scientists have started seeing all five species of salmon native to the river coming back, particularly Chinook and coho. Bull trout, they've observed, have increased in size since the dams were removal.</p>
Benefits on the Middle Fork Nooksack<p>McEwan hopes to see a similar outcome on the Middle Fork.</p><p>Like the Elwha the Middle Fork Nooksack is a relatively pristine river with little development, and dam removal is expected to provide a big boost to fish. The additional miles of spawning habitat are important, but so is the temperature of that water.</p><p>The dam removal will open access to cold upstream waters, which are ideal for salmon and getting harder to come by as climate change warms waters and reduces mountain runoff.</p><p>"This is really great for the climate change resiliency for these species," says McEwan.</p><p>Steelhead will get back 45% of their historic habitat in the river, and scientists expect Chinook populations to increase in abundance by 31%.</p><p>That <em>could</em> help Southern Resident killer whales.</p><p>"When you get to the ocean, it's a little bit of a black box in terms of what you can model and say definitively is going to help, but more fish is better for orcas," McEwan says.</p><p>Upstream habitat will see benefits, too.</p><p>Oceangoing fish like salmon enrich their bodies with carbon and nitrogen while at sea. When they return to their natal rivers to spawn and die, the marine-derived nutrients they carry back upriver become important food and fertilizer for both riverine and terrestrial ecosystems — aiding everything from trees to birds to bears.</p><p>"Once the fish start making their way back, it will start changing the whole ecological system," says Delgado.</p><p><span></span>But any ecological benefit from salmon restoration, either in the ocean or the upper watershed, won't be immediate.<br></p><p>"The population of salmon on the Middle Fork is so low that we expect it's going to take quite a while to rebound," she says. "But the big picture is that what's good for salmon is good for the region — our history and our destiny are intricately intertwined."</p><p>After decades of work, that process of restoration has finally begun.</p>
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By Katie Howell
A new tool called The Food Systems Dashboard aims to save decision makers time and energy by painting a complete picture of a country's food system. Created by the Johns Hopkins' Alliance for a Healthier World, the Global Alliance for Improved Nutrition (GAIN), and the U.N. Food and Agriculture Organization (FAO), the Dashboard compiles food systems data from over 35 sources and offers it as a public good.
By Manuela Callari
It can grow to a maximum of six inches (16 centimeters), change color depending on mood and habitat, and, like all seahorses, the White's seahorse male gestates its young. But this tiny snouted fish is under threat.
Building an Ocean Seahorse Destination<p>Seahorses are found in tropical and temperate coastal water worldwide, but are most abundant around Australia, China and the Philippines. </p><p>Trade in the tiny creatures is strictly regulated because of their use in traditional medicine, aquariums and their sale as dried curios. But because they are poor swimmers and cannot easily move elsewhere, habitat loss is a particular threat for these curious animals. </p><p>Seahorses wrap their tails around seagrass and corals to avoid being carried away on currents. They use the habitat to spawn and hide from predators such as crabs, while also feeding on riches of plankton and small crustaceans living in the reef.</p><p><span></span>Where corals aren't available, <a href="https://onlinelibrary.wiley.com/doi/abs/10.1002/aqc.1217" target="_blank">scientists</a> found seahorses taking up residence in fishing nets and old crab traps abandoned at the bottom of the ocean. </p>
Mixing With the Locals<p>Baby seahorse mortality is high in the wild because they are easily caught, so those bred in the protected environment of the aquarium weren't ready to be released into the wild until early May.</p><p>The team released 90 new arrivals into Sydney Harbor, placing some directly into the purpose-built hotels, and others onto a net that wild seahorses had already settled on.</p><p>Before setting them free, the researchers marked each young seahorse with a fluorescent tag with unique IDs inserted just beneath the skin to track how they get on in the different environments. </p><p>"The most exciting part was being able to put these animals into the wild and then go back a month later and still see them surviving and growing," said McCracken. </p><p>The seahorses will be old enough to mate and reproduce around October or November 2020. And researchers hope that by then, they will be able to breed with the wild population. </p>
Building a Global Seahorse Hotel Chain<p>With seahorses everywhere facing the loss of their coral reef homes, similar projects have sprung up in places like Greece and South Africa, home to the world's most endangered seahorse, the Knysna seahorse. </p><p>"The endangered South African seahorse is benefiting from something quite similar, even though it wasn't intentional," said Peter Teske, professor at the Department of Zoology, University of Johannesburg.</p><p>In the South African <a href="https://www.researchgate.net/publication/322649251_An_endangered_seahorse_selectively_chooses_an_artificial_structure" target="_blank">case</a>, seahorses have bedded down in "Reno mattresses" — wire cages filled with rocks — that were used to build a new marina. Researchers from NGO Knysna Basin Project found the structures acted as a refuge for the animals.<span></span></p><p><span></span>While Teske describes the seahorse hotels as "a positive news story" and a great way to create public awareness of conservation, he added that establishing artificial habitats in some areas will only prevent the extinction of local populations.</p><p>"For a complete recovery, it is necessary to give the natural habitat a chance to regenerate," said the seahorse expert. </p>
Underwater Mascot<p>In Australia, the researchers hope the project could provide an opportunity to raise awareness not only of the plight of the Sydney seahorses but the other animals with which it shares its ocean habitat.</p><p>The waters around Sydney and the east coast are rich in biodiversity and include several threatened species like the weedy seadragon — a relative of the seahorse — and the grey nurse shark. Like the seahorse, they're also under pressure from pollution, ocean traffic and habitat loss through storms and coastal construction. </p><p>"It's a good thing to get people's support and interest. The seahorses are a useful vehicle to get people concerned if the harbor is in trouble," said David Booth, professor of marine ecology at the University of Technology Sydney who is also working on the project. </p><p>The hotels have become an attraction for divers hoping to catch a glimpse of these small but near mythical creatures. </p><p>"Everyone loves seahorses," added Booth, "they are so popular." </p>
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