IPCC report on renewable energy sources and climate change mitigation

An energy supply system dominated by renewables can be realized by 2050, says the IPCC. The technology is to hand, or in sight. But integration of renewables with existing energy systems remains uncosted.

Renewables Integration Is Uncosted

The headline message, that close to 80% of the world’s energy supply could be met by renewables by 2050, was widely reported in the weeks before final publication of the ‘IPCC Special Report on Renewable Energy Sources and Climate Change Mitigation’ in mid-June. The IPCC’s work will provide the evidence base for the energy policies of governments around the world.

The scenario that shows 77% of global primary energy needs supplied by renewable energy in 2050 is, admittedly, the most optimistic of many scenarios in the report. It would require further technological development and considerable technology cost reductions. But the report finds a number of renewable energy sources are already competitive with fossil fuels. Technological advancement and cost reductions are proceeding at dramatic pace.

There is also historical precedent for rapid change in global energy systems, according to Professor Ottmar Edenhofer of the Potsdam Institute for Climate Impact Research and Co-Chair of the IPCC Working Group behind the report. National electricity grids are less than 90 years old; the global oil industry has existed for 80 years and the global gas industry for just 50 years.

“It is not a technical issue. It is an economic issue,” said Edenhofer at a launch event for the report in Berlin in May.

Pricing integration

“Regardless of the present energy system, whether in energy-rich or energy-poor communities, higher shares of renewable energy are technically feasible but require careful and consistent long-term planning and implementation of integration strategies and appropriate investments.”

The IPCC report looks at integration of renewable energy into global energy systems in three ways: actual operational experience of renewable energy integration; integration studies that have evaluated the potential implications of even higher levels of renewable energy supply; and the technical and institutional solutions that can be used to help manage renewable energy integration concerns.

Professor Edenhofer highlights a crucial finding from that investigation.

“Knowledge of the costs of integration of renewable energy into a fossil fuel dominated energy supply system is low,” he says. “It is astonishing that everybody seems to like renewables and talks about renewable energy, but there is so little knowledge about the costs of renewables.

“That lack of understanding forms one of the most important barriers to greater use of renewables.”

The few comparative assessments in the literature of the integration of renewable energy into fossil fuel-dominated energy systems are mainly for relatively low shares of renewable energy (such as wind electricity in Europe and the USA and biomethane injection into European gas grids). Those assessments show that the additional costs of integration are wide-ranging and site-specific.

The report sets out a range of cross-cutting issues that can affect renewables’ integration, including energy distribution and transmission, system reliability and quality, energy supply/demand balances, system flexibility, storage systems, project ownership and financing, operation of the market, supply security and social acceptance.

The distribution, location, variability and predictability of renewable energy resources will determine the scale of the integration challenge. The characteristics of renewable energy resources, such as their unpredictability and variability over timescales ranging from seconds to years, can constrain the ease of integration and result in additional system costs, particularly as renewable energy begins to account for higher shares of electricity, heat and fuels. Variable wind, wave and solar resources can be more difficult to integrate than dispatchable reservoir hydro, bioenergy and geothermal resources.

One of the most important measures of the ability of renewable energy systems to integrate with existing energy systems is the ‘capacity credit’ range of each renewable energy technology, according to Professor Edenhofer. Capacity credit is an indicator of the reliability of a generation type to be available during peak demand hours. If a generation type has low capacity credit, the available output of this generation technology tends to be low in high demand periods. The capacity credit of bio energy, geothermal and hydropower are comparable to fossil fuel power plants. Wind and direct solar energy have, in the worst case, relatively low capacity credits.

Studies show that combining different variable renewable sources will be beneficial in smoothing the variability and decreasing overall uncertainty. Network infrastructure will be a key issue. In electricity supply systems, overall balancing will become more difficult to achieve as partially dispatchable renewable energy penetrations increase. Yet, delivering new network infrastructure will face institutional challenges. In particular, providing incentives for the required transmission investments and ensuring social acceptance of new overhead lines or underground or sub-sea cables, will be a challenge.

There are opportunities to dramatically reduce the cost of integration, as well as threats of increased costs. In a number of industries fossil fuels could be replaced with biomass residues, and some of today’s industrial energy consumers, such as sugar and rice processing, could become net suppliers of heat and electricity. Flexible demand response services such as smart metering with real-time prices and more efficient thermal electricity generation may lead to dramatic changes in future electrical power systems.

Oracle with a Kaleidoscope

According to the IPCC report, the changing landscape itself creates gaps in our knowledge related to integration options that may become important in the future. The characteristics of future electrical power systems that include widespread deployment of non-synchronous generation cannot be known at this stage. Not enough is known about the protection and interoperability of meshed HVDC networks required to connect offshore wind and ocean energy. The changes that would be needed to protective relaying to ensure system reliability and safety are not clear. New probabilistic methods will be needed for planning in the context of high proportions of variable stochastic generation. Changes in the non-renewable generation portfolio (such as the impact of retirements, flexibility characteristics and the value of possible fleet additions or upgrades) cannot be predicted. Better – but not yet designed - market arrangements will be needed for variable renewable and flexible sources. And, of course, the world is not a monoculture, nor do we operate a globalized economy. Integration needs in new and emerging markets will differ from those in the developed world, according to the IPCC team.

The net result of the IPCC team’s investigations is that we simply cannot plan at the macro level with any real certainty. As Professor Edenhofer puts it: “We haven’t been able to say something quantitatively on the integration costs. What we have are nice examples, but we do not know to what extent those nice examples can be upscaled.”

“The inability to determine ‘typical’ integration costs across the many differing systems and present them as ‘representative’ is a barrier to wider renewable energy deployment and modeling scenarios.”

Like any good scientist, Professor Edenhofer is keen to identify all the limitations to his research conclusions:

“The report has identified the most important known-unknowns, like the future costs and timing,” he says. “We have to deal with the unknown-unknowns. The existing scientific knowledge is significant and can already facilitate the decision-making process. However, the unknown unknowns require the flexibility to learn from experience and to adapt to inconvenient and convenient experience.”

Further analysis would be useful, he concludes.

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