As we near the end of the year, it is anticipated that Congress will be discussing whether to extend certain federal tax credits such as the Alternative Fuel and Energy Efficiency Tax CreditsContact your representative to learn if they will support extending the Alternative Fuel Tax Credit and below energy efficiency tax incentives that also expire at the end of 2020. (Note that biodiesel credits are covered under the Biodiesel Income Tax Credit which continues through December 31, 2022. The Renewable Energy Tax Credits expire December 31, 2021.) 

  • Alternative Fuel Tax CreditA tax incentive is available for alternative fuel that is sold for use or used as a fuel to operate a motor vehicle. A tax credit of $0.50 per gallon is available for the following alternative fuels: natural gas, liquefied hydrogen, propane, P-Series fuel, liquid fuel derived from coal through the Fischer-Tropsch process, and compressed or liquefied gas derived from biomass. 
  • Commercial Building Energy-Efficiency Tax DeductionA tax deduction of up to $1.80 per square foot is available to owners of commercial buildings or systems that save at least 50% of the heating and cooling energy as compared to ASHRAE Standard 90.1-2007 (or 90.1-2001 for buildings or systems placed in service before January 1, 2018). The deduction is available for buildings or systems placed in service after December 31, 2017 through December 31, 2020. Partial deductions can also be taken for measures affecting the building envelope, lighting, or heating and cooling systems.
  • Residential Tax Credits for Energy Equipment & Energy Efficiency Improvements: Homeowners can claim a federal tax credit for installing appliances that are designed to boost energy efficiency or making certain improvements to their homes (10% of cost up to $500 or a specific amount from $50-$300).  
  • Tax Credits for Builders of Energy Efficient HomesHome builders are eligible for tax credits for a new energy efficient home that achieves energy savings for heating and cooling over the 2006 International Energy Conservation Code (IECC) and supplements. A required amount of energy savings must come from building envelope improvements. This credit also applies to contractors of manufactured homes conforming to Federal Manufactured Home Construction and Safety Standards and meeting the energy efficiency requirements. Alternatively, a manufactured home also qualifies for a $1,000 tax credit if it meets ENERGY STAR requirements. 

If you would like additional information regarding the above incentives visit the Database of State Incentives for Renewable Energy (DSIRE)email your Clean Cities coordinator, or contact MEC at (816) 531-7283. 

Photo by Dennis Schroeder, NREL 47301

Electricity is tied to our lives in a way you might not expectand not in the sense of necessity or convenience.  Instead, our daily behavior, waking and sleeping, dictates how utilities generate power.  As we wake up, hit the lights, fire up the microwave or turn up the furnace, demand rises.  Through the day, generation increases to meet our needs.  Demand peaks in late afternoon and starts dropping at 6:00 or 7:00 in the evening as we leave the factory or office and head home.  This cycle changes with the seasons, with our use of air conditioning pushing demand to its annual high in summer.  It also varies from region to region. 

But whatever the season or region, from around 11:00 PM to 7:00 AM, electric utility output is at its lowest.  This nightly low-level output is called baseload generation – the minimum needed for essential systems that run continuously – and it never stops.  Baseload plants, typically coal or nuclearrun near or at capacity nearly all the time.  They’re the biggest power plants since the formula “Bigger = Better makes economic sense for systems in continuous operation.  These plans are extremely efficient.  They also run continuously because baseload plants are ferociously expensive.  KCP&L (now Evergy) completed its 850 MW Iatan coal plant in 2010 at a cost of about $2 billion.  The more continuous hours a plant that big and expensive runs, the sooner it can be paid off.  Nuclear plants are far more expensive, but that’s a story for another article. 

There’s another reason that coal and nuclear dominate baseload generation – time.  As demand for electric power grows through the day, there’s no reason that it can’t be met by increasing output at another coal or nuclear plant.  The question is how many hours or days later that electricity will arrive.  It takes days to bring a nuclear plant from a cold shutdown to full power, and up to eight hours for a coal plant to hit peak output even from a warm start.  On a 100F summer day, as air conditioner use spikes quickly to beat the heat, utilities don’t have hours to spare.  That’s why a second breed of power plants exists – peaking plants, designed to quickly provide electricity above and beyond baseload.   

Peaking plants are a very different animal from their baseload cousins.  They’re generally smaller, and typically operate using natural gas or pumped hydroelectric storage, depending on location.  They only operate for a limited number of days every year – as little as 10% of the time.  They’re also much faster to respond to demand spikes and can start generating power in five to ten minutes.  But speed has a price – they’re also far less efficient than baseload plants. 

As demand risesutilities have to produce more power.  They have three options  producing more from what’s already online, bringing additional plants into service, or buying it from other utilities.  Althree options cost money.  That’s why, as part of an overall movement towards deregulating electricity markets, some utilities now charge different prices for electricity, depending on when it’s needed.  Peaking power at 4:00 PM in August is much more expensive than baseload power at 4:00 AM in January.  On the other hand, if a utility has surplus, they can sell it for far more.  This evolving market is one of the reasons the industry is changing rapidly. 

“There is nothing simple about operating a power grid.” 

Other rapid changes are shifting the baseload baseline.  One key reason is renewable.  Other than the rapid growth in natural gas in the last 30 years, the big story has been wind.  From producing very little at industrial scale as recently as the year 2000, wind energy now produces more power than hydroelectricity.  But wind energy is generated at Nature’s pleasure.  When the wind really blows, the question becomes what to do with all that surplus power.  And when the wind doesn’t blow, what are the best resources to handle the load?  Electricity isn’t water or soybeans or money – it can’t be stored at scale, at least not yet.   

These are the challenges facing the power industry today as it adjusts to advancing energy generation technologies.  Grid integration or smart-grid tech is an emerging technology capable of managing the challenge.  It can handle variable amounts of energy from renewable sources, finding ways to store electricity, and maintaining reliable power suppliesmeeting one of the biggest infrastructure and tech challenges we’ll face this century.  Stay tuned.  We’ll provide more detail on that promising solution, and more, in forthcoming articles. 

                It’s probably an overstatement to call propane America’s most overlooked fuel.  That said, it does kind of fly under the radar.   For many of us, our only interaction with it comes when replacing a cylinder for the barbeque grill.  But beyond the bottle cage at Lowe’s, and once you leave the city, propane is ubiquitous.  In America, if you’re in the country, you’re in propane country.  83% of all households that heat with propane are in rural areas.  In the rural Midwest, it’s close to 90%.  Propane is affordable and easy to purchase and use, thanks to a well-developed supplier network.

Part of oil and gas formations, propane is one of the natural gas liquids (NGLs) along with butane, pentane and a few more.  During oil and gas production, NGLs come hissing to the surface, mixed with natural gas.  They’re then separated during refining and sold as feedstocks for plastics, solvents, and (in the case of propane) for heating and fuel.  They are a small slice of the global oil and natural gas market, about 14% of output.  But as fracking has boomed in the past decade, nearly doubling American propane production, more auto manufacturers and fleet managers are taking another look at propane-powered vehicles.

Propane Power

Like any fuel, propane has its pluses and minuses for transportation.  Propane is less energetic than either gasoline or diesel.  You would have to use 1.38 gallons of propane to match the energy of a gallon of gasoline, and 1.52 gallons to equal a gallon of diesel.  The flip side is that propane is cheap – it typically costs about 30% less than gasoline and 50% less than diesel fuel.  It’s also far cleaner than diesel, producing far less in the way of smog-forming chemicals.  This means that many components of diesel emissions control systems – DPF regeneration, diesel oxidation catalyst, selective catalytic reduction, diesel emissions fluid – are eliminated by switching to propane.  Diesel emission controls work, but they also make for complicated, expensive maintenance.

But in the end, there’s still an impact.   Propane is still a fossil fuel, and still part of the big global machine that produces oil and gas, and also pumps ever-more carbon into the atmosphere.  Or at least it was a fossil fuel, until now.

The Renewable Difference

What’s new?  Renewable propane.  It’s chemically identical to fossil propane, but produces between 60% and 70% less carbon when used.

Renewable propane and diesel have some things in common with biodiesel.  All three can be made from the same renewable feedstocks, like corn oil, soybean oil, tallow and waste grease.  But the methods to produce these fuels are very different.  You can make biodiesel at low temperatures and at small scale, in laboratories or classrooms – there’s even a user’s guide for high school students interested in biodiesel.  But renewable diesel and renewable propane come from refineries, produced by some of the same processes as fossil fuels.  They’re chemically identical to their petroleum versions, and have the same properties.

As a clean-burning, low-carbon fuel produced from renewable feedstocks, there’s a lot to like about renewable propane.  This is especially true in major markets like California.  There, tough clean air standards give cleaner-burning fuel an edge over conventional options, and clean fuel credits can sweeten the financial picture for users.  Today renewable propane only accounts for somewhere between 1% and 2% of all propane output.  But prospects for rapid growth of this lower-carbon and completely renewable energy source seem bright.

At MEC, our job is to keep tabs on energy use in the central Midwest, but why should that matter? Because the ways that people and businesses use energy can affect lives. Technology has yet to come up with a solution that moves people and goods without releasing some sort of air pollution, and air pollution affects human health.  The problem is that every power source that can power a vehicle will create emissions and will have a carbon footprinteven electric vehicles.  There are, however, many alternative fuel options that arefar cleaner than gasoline and diesel.  If you’re looking for a vehicle that produces less emissions, there are a lot of factors to consider when making your decision. 

Let’s compare the different ways that the energy we use affects our health. In 2017 the emissions from vehicles on the road passed up the amount of emissions released from power stations.  That switch has shown up as health problems, such as the increase of child asthma cases for families living near highways and railroads.That’s simply because vehicle emissions get concentrated in the air around the places that people and goods get transported. Transportation emissions are now the #1 source of greenhouse gases too, making it globally important to choose our transportation wisely.  For the sake of our local and global health, we must decide to make transportation cleaner. The question now is how. 

For some, their ideal chosen solution is to walk or bike more places, and to only shop for things in stores within walking distance of their house.  But what if you need transportation?  Remember that COVID shutdowns produced sudden, startling air quality improvements the likes of which we haven’t seen in decades.  As residents of Los Angeles and New York saw with their own eyes, less vehicles on the road immediately improved their air quality, even in heavily polluted cities.  But the shutdown of society isn’t a realistic model for fighting climate change in the long run.  Movement of people and goods still must happen.  Are there cleaner solutions than what’s commonly used to move people and goods right now? The simple answer is yes.  For a more complete answer, here are options that make sense for our health, the economy and the environment. 

Electric vehicles (EVs), which plug in to an electrical supply to “fuel up, are creating a lot of buzz right now, and rightly so. All-electric vehicles have zero emissions coming out of their tailpipesso they appear to be the magic bullet for clean air around our roadways.  Plug-in hybrids are also great, in that they make use of electricity as a primary fuel, but are equipped with a fuel tank as a backup for longer trips.  EVs are great as urban or suburban family cars, transit buses, or local delivery trucks that rack up limited daily miles before returning to base to recharge.  Plus, long-range batteries, fast charging stations, and new heavy truck technologies are under rapid development, so the list of compatible uses is getting longer by the day.  

You may not realize that you can help your electrical grid become more efficient with the electricity being generated just by owning an EV and charging it at night.  The electrical grid is set up to estimate how much power is needed, and then generate slightly more than that amount to provide for our electricity needs.  Whatever electricity is generated at power plants either gets used, or it dissipates with non-use.  If you charge an EV overnight, it utilizes that energy that would otherwise be wasted. 

Biofuels are another cleaner transportation option available now.  They come from farm-produced food commodity byproductsthey emit substantially less air pollution when burnedand they’re surprisingly less expensive than the worst emission producers, gasoline and diesel.  Ethanol and biodiesel have been around for a while, and just like your cell phone, their design and our use of them has greatly improved over the last 20 years. 

In the 1990s, car manufacturers started figuring out how to protect the insides of vehicle fuel lines from the extra corrosiveness of ethanol blends, which is basically ethyl alcohol (moonshine!) mixed with gasoline.  By 2012, ethanol had busted into the mainstream, and most vehicle manufacturers now support up to 15% ethanol (E15).  To save money and get a cleaner burn in your vehicle, look for the E15 label on pumps at gas stations.  The added ethanol increases the octane, which is actually better for modern, more fuel-efficient engines.  Plus, the more ethanol mixed into gasoline, the fewer harmful, carcinogenic gases get released into the air around it All of this is why today most gasoline at the pump already has 10% ethanol in it.  You can choose higher blends if your vehicle is rated to use them.  Then it’s a matter of finding a local gas station where that blend is available to support your choice.  When you’re buying a family vehicle and want the option of using high blends of ethanol (E20-E85)ask to look at flex-fuel” options at your dealership Typically, a flex-fuel vehicle will have a yellow gas cap, indicating that you can safely use blends up to 85% ethanol, wherever you should find them. 

Biodiesel is another clean fuel option. It can be used in most diesel-fueled vehicles, and also supports the regional economy as a value-added farm product. It is a renewable fuel made from vegetable oils, primarily soybean and sometimes corn oil, but also from recycled cooking oil and waste fat. No, you can’t just pour the grease from your deep-fried turkey into your pickup. Just like petroleum, it has to be refined first, and biodiesel at the pump has excellent quality controlsMost diesel engines can use blends of biodiesel and petroleum diesel up to 20% (called “B20), which can be found at some area fuel stations. It’s also an easy drop-in fuel option for farming equipment, heavy-duty freight engines, and industrial work trucks. Fortunately for companies with large industrial fleets, fuel distributors are ready today to bring biodiesel or ethanol blends directly to industrial sites. 

Natural gas, or methane, the same fuel that cooks your food and heats your home, can be used in specialized “Near-Zero” engines that are made to burn it Natural gas is a clean burning fuel with much lower emissions than plain petroleum diesel.  It comes in two possible transportation fuel products: compressed natural gas (CNG) and liquid natural gas (LNG).  Both are available in renewable options.  More on that later. Natural gas is widely available through existing pipelines, and fuel costs are lower and more stable than diesel. It’s a great option for heavy vehicles such as freight trucks, transit buses, and refuse trucks. And, because the engines are quieter than diesel engines, that 6 am trash pickup won’t disturb your sleep.  CNG engines eliminate nearly all smog-forming pollutantshence the trade name “Near-Zero” engines While CNG is available to the general public at some area fueling stations and you can convert some cars and trucks to use CNGit usually only makes financial sense for high-mileage vehicles or fuel-hungry service providers to use it.  A number of our regional governments and service providers are already using CNG today. 

Making natural gas more climate-friendly is a priority for many people and government agencies.  The ultimate low-hanging fruit in reducing climate emissions is renewable natural gas (RNG) which involves collecting and then using methane, a greenhouse gas far more potent than carbon dioxide. Methane comes from sources other than just underground and a whopping 39% of natural gas vehicle fuel comes from renewable sources like landfill gas, which comes out of landfills whether it’s used or not.  Other sources of RNG include wastewater treatment plants, food waste and agricultural byproducts Available in both liquid and compressed forms, RNG is rapidly gaining market share because of its ecologically friendly procurement methods Done right, RNG can even have a negative carbon footprint! 

Which fuel heats your grill AND gets your kids to school?  Propane (also called autogas for transportation uses) It’s yet another cleaner burning, low-emission fuel with notably quieter operation than diesel fuel.  That makes for a much quieter ride, which drivers appreciate.  Because of that stealthy qualitypropane is a popular option for fleets of larger vehicles, especially school bus fleets.  Propane on aautogas transportation contract costs much less than diesel, so school districts can save substantially on fuel costs.  Switching to propane also means that students don’t have to breathe diesel exhaust while waiting for their busesPropane is widely available, with distribution networks already in place nationwide.  Like with CNG, you can convert some personal vehicles to run on propaneand though a bit harder to find than gasoline, it is available at some retail fuel stations. Not to be outdone by its gaseous counterpart RNG, renewable propane is an emerging product As icing on the cake, propane engine manufacturers are actively developing their own version of a “near-zero” engine, expected to be available in coming years. 

Though none of these options are ‘perfect’, they each offer substantial benefits compared to conventional fuelslower cost, longer engine life, quieter operationslower emissions, and economic benefits to the farm economy.  Though no single alternative fuel captures all these benefitsthere’s likely an option that’s almost perfect for your needs When more people, businesses and government fleets embrace alternative-fuel options, the owners/operators enjoy lower costs, softer road noise and less air pollution.  And with more investment in alternative fuels, research and development efforts continue to make every available option even better Big picture: petroleum diesel is far and away the worst culprit in making our air harder to breathe.  In order to cut down on the emissions released into the air by our transportation practices, it’s necessary for all of us to recognize and support any and all options. We can’t yet eliminate vehicle emissions, but moving in that direction ifar easier than you might think.  

For more information on alternative fuels and vehicles, check out the Alternative Fuels Data Center.

It’s easy enough to find information about energysometimes too much information to get a handle onSo, when thinking about energy in the United States, it’s not a bad idea to simplify thingsthere’ll be time for details later. For electricity, think of The Big Five. The five biggest power sources provided 95.5% of all the electricity generated in the United States in 2019. They were, from biggest to smallest: Natural Gas (38.4%), Coal (23.5%), Nuclear (19.7%), Wind (7.3%) and Hydropower (6.6%). Last year, the Big Five generated nearly all of total US output of 4.12 million Gigawatt hours of power.But just as energy is always moving, our sources of energy are a moving target as well. Go back 30 years, and you’ll see a very different picture. Since 1989, coal’s share of the electricity market has collapsed to less than half of what it was, while natural gas has more than tripled. Nuclear power and hydroelectricity have declined slightly. Oil-fired power plants have largely disappeared. Meanwhile, wind generation, which essentially didn’t exist in 1989, has more than made up for the end of the oil-burnersAnd most of these changes took place within the last decade, not gradually. If you get only one essential takeaway from this very brief overview, it should be thisAmerica’s electrical grid is undergoing huge changes, along with the energy sources that power it, and the pace of those changes is accelerating.

As this series of articles continues, we’ll fly lower across this landscape to pick out more detailsand to ask more questions. As coal declines, what choices will states like West Virginia and Montana confront? What new technologies are in the pipelineand which old technologies can be reworked? Can we maintain our energy-rich lives in a climate that’s increasingly unpredictable? To what degree can we electrify transportation or buildingsAnd should weThe choices we make, and those that are made for us, will define our world for decades to come. 

 

 

You have power.   

Your access to energy would have cracked human credulity for most of our species’ time on earth. For millennia, we elbowed away the margins of night with the smoking glow of wood, grass or buffalo chips. Just 200 years ago, whale oil and candles lit the homes of a slowly industrializing world—for those who could afford them. For those who couldn’t, wood remained the main source of light, heat and cooking, along with the coal that drovthat industrialization. Now, in an eye-blink of human history, we have become the beneficiaries of a world in frenzied motion.   

The energy we use never stops moving. It hurtles from point to point at velocities approaching the speed of light. It slowly plows the oceans in ships big enough to dwarf the fever-dreams of Pharaohs. It is explosive coal dust shot into a furnace, feeding flames five stories high hot enough to melt platinum. It is water roaring 600 feet down a pipe, turning a generator the width of a small house 100 times per minute. It is mazes of pipes and conduits, steam and heat, toxic and explosive chemicals, all combining to refine Jurassic sunlight into jet fuel and gasoline. It is today’s sunlight knocking electrons out of their orbits and into batteries and wires. It is the fission of a single uranium atom unleashing enough energy to make a grain of sand visibly jump, triggered by a neutron moving 1.4 miles per second in reactor spaces unimaginably dense with such reactions. This frenzied motion never stops, only occasionally slows, and makes our world—food, music, lighting, medicine, communications, trade, everythingpossible. 

As Americans, how does all this shake out? What drives our nation’s energy system today, and what will that system look like tomorrow? And what kind of future do we face as the consequences of this vast, and amazingly productive disruption become clearer? These are the kinds of questions this continuing series of short essays will try and provide some answers to.   

We are Metropolitan Energy Center. Part of our mission is to present the best information available on energy, its principles, power and drawbacks, whether it’s heating your house or powering your car. We’ll be covering a lot of ground–from the grid to the feedlot, and from alternative fuels to solar technology. We’ll touch directly on the projects we pursue and probe larger questions of energy policy. We hope that in the process we can hold your interest, provide food for thought, and perhaps puncture a few myths about what new technologies can and can’t do.   

Things are already moving fast, and we hope you’ll hop on board for this excursion.

To the casual observer, battery-electric vehicles (BEVs) appear nestled comfortably on the upslope of a growth curve that would turn other industries green – with envy, in this case.  From a global grand total of about 20,000 EVs of all makes on the road in 2010, by 2019, the total number of plug-in hybrid (PHEV) and full electric autos on the road worldwide rose to 7.2 million.  That’s an almost a 360-fold increase in less than a decade.

The biggest surprise to date has been the number of surprises to date.  Who imagined that an automotive startup – the first such large-scale attempt since Kaiser-Frazier back in 1947 – would flat-out pound legacy OEMs in the US in any market segment?  In 2019, Tesla’s three all-electric models outsold GM’s EV/PHEV Bolt and Volt combined by nearly nine to one.  Also in 2019, the California upstart commanded more than 78% of US BEV market share.

Who imagined that battery costs would continue to collapse at the rate we’ve seen through 2019?  In 2010, battery costs per kwh averaged about $1,100 – in 2019, they hit a new low of $156.  Who imagined that price parity between EVs and conventional ICE models could arrive in some market segments by as soon as 2022, 2023, or 2025?  What year, of course, depends on whether the crystal ball you’re consulting belongs to Deloitte, Roskill or Carnegie Mellon University.

It’s this last bit – predicting the crossover– that we want to take a look at today.  Not surprisingly, it’s complicated.  Total cost of ownership for an EV can be substantially lower than for an ICE car.  With simple drive trains, EVs have fewer points of failure, and electricity is cheaper than gasoline in most industrialized nations.  Tax incentives and rebates can substantially sweeten the pot.  But in the words of a recent Automotive News article, mass EV adoption is “inevitable, yet elusive.”

Multiple factors are in play.  Infrastructure buildout is slower than it could be.  Manufacturers may increase their margins once EVs hit a tipping point, given the substantial sunk costs they’ve already incurred.  Moving the needle on consumer acceptance is still difficult.  Though we’re expecting the arrival of multiple EV models by multiple OEMs by 2023, 14 different brands didn’t offer a single EV option as recently as the end of 2018.  And there’s still a rough $6,000 – $9,000 gap between EV models and their ICE counterparts in non-luxury categories.  In the end, it may be mandates that do the heavy lifting.  For all of the reasons above, and given Americans’ aversion to mandates, IHS Markit projects 40% of EU cars will be hybrid or pure EV by 2031, compared with 20% of the American passenger fleet.

Above and beyond the usual suspects, there’s one you might not have suspected – reliability.  At least in the US, drivers are holding onto their cars longer than ever, thanks in part to better quality.  By this July, the average age of an American car was a record 11.9 years, and per IHS, one in four cars on the road in the United States are more than 16 years old.  This is something of a tribute to improved automotive quality:  as noted in the article linked above, “Back in the ’90s, one-quarter of cars parked at the grocery store were not Ford Mavericks and Chevy Vegas. Nowadays, that beige 2002 Corolla is still ubiquitous.”

With COVID driving economic worries for consumers, auto purchases may be viewed as more discretionary than ever, particularly when it comes to buying a new car.   At the same time, until the pandemic is under control, road trips (vs. flying) and commuting by car (not public transit) may keep long-term auto demand simmering, even as our wheels continue to gray.  How all of the preceding will drive EV acceptance in the next few years is hard to forecast, but we’ll be watching closely.

Since January, there’s been a lot of discussion, analysis and 151-proof worry about the COVID virus – understandably.  Viral impacts have produced (in less than six months) the biggest economic implosion since the 1930s, public health lockdowns spanning the planet, and a global death toll of (at this writing) 434,388, with nearly 116,000 of those confirmed deaths in the United States.

As you’d expect, there has also been a certain amount of silver-lining searching.  It’s only natural – as human beings, we look for the lesson, or what we could have done differently or what we might gain in times like these.  And with cars off the road and factories closing down, citizens of cities as remote from one another as Los Angeles, Beijing and New Delhi looked out the window and realized something truly strange was happening – the air was cleaner than it had been in years, even decades.  This four-minute clip from CBS has visuals that I won’t try to convey via keyboard.  For many, the spectacle of suddenly invisible (a.k.a. “normal”) air was startling.

With that kind of obvious impact, the next Big Question didn’t take long to surface:  if substantially shutting down Normal looks like this, what kind of impact is it having on the climate?  The early returns are in, and the answer is – not much.  NOAA reports globally averaged CO2 content of 417.07 ppm (parts per million) for May – up from 414.65 ppm in May 2019 and 411.24 ppm in May 2018.  There’s science behind this lack of change.  Earth, in effect, breathes – this was Charles Keeling’s great discovery in the late 1950s.  Atmospheric CO2 content rises and falls each year, bottoming out in October as most of Earth’s landmass hasn’t yet released carbon dioxide before the northern winter, and peaking in May before northern hemisphere forests have really begun to reabsorb it.  This means that COVID’s clean air aftereffects hit just as seasonal CO2 growth approached its peak.

Early estimates are that pandemic shutdowns led to an 8% drop in anthropogenic CO2 output, and that it would take 20-30% reductions for at least six months to put a dent in atmospheric readings.  As climatologist Katherine Hayhoe notes, imagine all the carbon we’ve put into the atmosphere as a pile of bricks.  We’ve been piling them up for about 250 years, more or less, and cutting a slice from latest brick dropped on top of the pile doesn’t make that much of a difference.  And we’re already seeing a rapid rebound in human CO2 output; “Things have happened very quickly”, in the words of one climatologist tracking current conditions as economic activity ramps back up again.

So if even something as disastrous as COVID can’t substantially alter the pace at which CO2 continues to pile up in the planet’s atmosphere, what will?  And if all the efforts made to clean up our energy act to date haven’t materially changed things, what can?  It would be easy to throw up our hands and assume that this spring’s lack of substantive results represents something permanent.

It doesn’t.

We are at an inflection point in how we produce and use energy and the pace of change is only accelerating.  Coal, the dirtiest source of electricity, is dying in multiple major economies.  June 10th marked 61 straight days that the United Kingdom didn’t generate one kilowatt from coal.  COVID has cut demand, so that and an unusually sunny May are part of the story, but the UK’s power grid has fundamentally changed.  A kilowatt of electricity cost as much as 600 grams of CO2 in 2012 – this spring, as little as 125.  And this took place even as the country’s population grew from 64.5 million in 2012 to 68.9 million this year.  In the US, electric output from all renewables surpassed electricity from coal for the first time since the 1880s, and coal has essentially collapsed as a utility fuel – from a peak in 2008 at around 23 quads (Quadrillion BTUs), it’s now producing around 12 quads, as the graph at the link above powerfully illustrates.

And it isn’t just a question of generating electricity.  Large-scale battery storage, a long-time dream of clean power advocates, is expanding rapidly.  15 small-scale 9.95 MWh systems will support peak generation while smoothing out price spikes in Texas, and the state symbolized by the oil rig is already the nation’s leading wind generator.  In California, PG&E is negotiating 1.7 GWh of storage with the state – more than ten times the power of the Texas sites mentioned above.  Perhaps the single most striking change is the cost of solar energy;  between 1980 and 2012, the cost of solar modules fell by a stunning 97%, and those costs keep dropping, just as solar cell efficiencies climb to as high as 47% in some experimental designs.  Underpinning all of this is a simple, unignorable fact – renewables are now less expensive than fossil energy sources.  Markets are responding – unevenly in some locations, swiftly in others but responding all the same.

The task that remains is immense.  There is considerable doubt whether the goal of limiting further warming to 1.5 degrees C to avoid the worst of potential climate damage can be reached.  There isn’t all that much time left.  Lofty pledges of zero-emission goals by companies and countries by 2050 are fine, but we’ve already used up 1.5% of the time remaining between 2020 and 2050 to achieve those goals.  And yet, for the first time, there now appear to be enough tools on the bench – technological and economic – to let us get started on meaningful work.

So, when we talk about someone employed in “clean energy”, what does that cover?  Like “manufacturing”, many things. The Bureau of Labor Statistics (BLS) defines and tracks employment by sector, but it’s not the most user-friendly resource.  So, while BLS notes that there were nearly 6,000 wind turbine service techs employed in May of 2020, it divides them among five different industries, ranging from utility construction to consulting to local government.  Sadly, a BLS plan to categorize and track clean energy jobs begun in 2010 was abandoned in 2013 during a federal budget shutdown, and has never resumed.

More generally, clean energy jobs fall into four broad categories – energy efficiency (home upgrades or commercial building retrofits); renewables (solar, wind, biogas, or geothermal energy); grid and storage (electrical engineering, battery tech, and charging stations); and cleaner vehicles and fuels (hybrid and electric vehicle manufacturing or biofuel production).  Altogether, more than 3.3 million Americans work in one of these fields, and it’s worth noting that energy efficiency alone employed more than twice as many people as all fossil energy sectors combined.

Like nearly everybody else, clean energy workers have taken a hit in this economy.  About 147,000 jobs were eliminated in March, and April totals nearly tripled that.  More than 590,000 jobs in the sector evaporated by April 30th, two months ahead of projections by BW Research.  The same analysts now expect around ¼ of all green energy jobs to be gone by June 30th, some 850,000 in all.

Under the circumstances, this isn’t surprising.  Homeowners are unlikely to invite insulation crews into their homes in the midst of a pandemic.  Financial chaos means that banks are less likely to lend on large-scale clean energy deployments.  Cities facing budgets collapsing under tax shortfalls are going to emphasize essential services before clean energy buildouts.  And utilities are facing tumbling energy demand.  IEA estimates that from February through April, global demand for energy dropped 6%, the equivalent of all of India.  American energy demand is set to drop 9%, according to the same report.

Whatever the course of economic contraction and recovery, there are certain irreducible advantages to jobs in these industries.  To begin with, they tend to be site-specific.  Many renewable energy jobs are unlikely to be outsourced – those building and maintaining a thermal solar plant in Arizona, for example, are going to build and maintain it in that location for its useful life.  The same holds true for energy efficiency professionals – the homes and buildings in the United States aren’t going to offshore themselves.

Many skilled green energy jobs pay relatively well, can boost stressed economies and don’t require four-year degrees.  Wind turbine techs, for example, exemplify this beneficial clustering.  Wind turbines require regular service and maintenance, and wind farms are located largely in rural areas in the Midwest and southern Plains.  Technicians tend to live in smaller cities or towns near these sites, supporting the local tax base.  Median income for a turbine technician in 2019 was $52,910, which could go a long way in Russell County, Kansas or Alliance, Nebraska.  And training for the field takes one or two years, depending on program and specialization. Median income for solar installers was lower, but in 2019 stood at $44,890 per year, and for insulation crews, median income in 2019 was $44,180,

The issue, at least for now, is that the three specific categories mentioned above don’t employ very many Americans – about 75,000 in all in 2018 and 2019, according to BLS.  But broaden the focus, and green energy’s economic becomes clearer – and bigger.  Wind energy’s total economic footprint alone is already substantial.  In 2018, 530 plants in 43 states produced components – blades, nacelles, turbines, gearing and digital control systems. Outsourcing of some of this manufacturing is possible, but given the size and weight of components as turbines grow taller, is likely to remain largely here at home.  Moreover, the Department of Energy estimates as many as 600,000 jobs in all subsectors of wind energy in less than 30 years.

This kind of job generation potential is what makes remaking America’s energy system so important to inclusive economic recovery.  Utilities, states and cities are already beginning to implement plans to change how we generate and distribute energy in a carbon-constrained world.  These efforts have been patchy and slow, and to date unlikely to meet even minimal Paris Agreement standards.  But under the right circumstances, policy changes, like technological changes, can happen quickly.  Emphasizing the very real benefits of more clean energy jobs may help speed that vital process.

So where, as COVID redefines economies and politics, is the renewable energy sector?  What happens over the next few years – to technologies, investments, deployments and incentives – will determine multiple trajectories.  These include the jobs of millions of people, how quickly carbon accumulates in the atmosphere and oceans, and the possibility of stranded assets hampering any rapid, substantive switch from old to new.

If you’re thinking purely in terms of dollars and cents, the latest issue of Forbes has a fascinating article.  A joint study by the International Energy Agency (IEA) and Imperial College London reviewed returns on energy investments starting in 2009.  Combining German and French stock market data, the past five years showed returns of 178% for renewables and -20.7% for fossil energy.  UK renewable stocks returned over 75%, legacy energy 8.8%.  Here at home, where utility-scale renewable buildouts began later than in Europe, renewable returns were north of 200%, while oil, gas and coal stocks didn’t quite double.  Renewable investments proved more stable over the same periods measured.  But the same article notes that the biggest fossil energy shareholders – pension funds – are reluctant to disinvest from dividend-rich stocks.

Beyond that, an ostensible renewable energy transition is up against multiple countervailing factors – for starters $900 billion or more in potential “stranded assets” of global fossil energy companies.  The oil majors have talked a good game for years now, but the numbers don’t bear out their proclaimed commitments to renewables.  Exxon is now in court for, among other things, bragging on its green energy tech while spending less than ½ of 1% of revenues on renewable energy.  In 2019, BP projected spending between 3% and 8% (at best) of capex on renewables, and in February the company dumped an advertising campaign highlighting renewables.  And so on.

American utilities face the same kinds of stranded asset risks, though only 18% of utility employees view sunk costs in infrastructure as a top worry.  But power plants can be ferociously expensive to build.  Evergy’s Iatan 2 project, which went online nearly 10 years ago, came in at nearly $2 billion, with state-of-the-art environmental retrofits of the Iatan 1 plant adding to costs.  It can take large projects like this decades to pay for themselves; securitizing early retirement of fossil fuel plants can blunt risks to utilities, but so far has only been tried in three states.

Even bigger picture – there’s a substantial inertia built into an energy economy created more than 100 years ago – a vast, complex system that works remarkably well to meet the needs of its customers.  To date, renewables are still a small slice of total US electricity output.  In 2018, natural gas generated about 35% of our electricity, coal about 27%, nuclear a bit over 19% and all renewables, including hydroelectric, not quite 17%, with niche sources making up the rest.

To be clear, renewable energy’s recent eclipse of coal in the US has been remarkable.  In fact, the US Energy Information Administration (EIA) announced the very day this was written that in 2019 consumption of energy produced from renewables passed that produced by coal, the first time per EIA that this has happened since before 1885.  But a decarbonized energy economy is still decades away.  The International Renewable Energy Agency (IRENA) estimates that to even approach climate goals, renewables must increase to around 65% of global Total Primary Energy Supply by 2050 – and we’re nowhere close to that yet.  More on all of the above, COVID impacts and the state of play in our next renewable installment.