Pergamon Renewable Energy, Vol.5, Part I, pp. 5-11. 1994

Elsevier Science Ltd Printed in Groat Britain

0961)-1481/94 $7.00+0.00

GLOBAL PROSPECTS FOR RENEWABLE ENERGY

MICHAEL JEFFERSON

Deputy Secretary General, World Energy Council, 34 St. James's Street, LONDON SWlA 1HD, U.K.

ABSTRACT

Global prospects for renewable energy are bright, but for a number of reasons the pace and scale of development will be slower than some assume.

KEYWORDS

New renewables, local environmental impacts; existing interests; economic/financing barriers; technology diffusion; potential climate change; energy efficiency/conservation.

INTRODUCTION

Recently there has been revived interest in new renewable forms of energy, and in promoting their accelerated development. This renewed emphasis has coincided with rising concern at potential climate change. Another influence has been pollution arising from fossil fuel provision and use having more local and regional effects.

As someone involved in the work of the Intergovernmental Panel on Climate Change, I closely fol low new scientific findings and the ongoing uncertainties. This is a subject which the World Energy Council (WEC) treats wi th the utmost seriousness, and which the WEC's Commission "Energy for Tomorrow's World" (1993) concluded deserved precautionary action on a "minimum regret" basis to achieve abatement and mitigation of impact.

However, drawing on the work of the WEC Commission; on the WEC's study "Renewable Energy Resources" (1993)and as updated in "New Renewable Energy Resources" (1994)1; and on the WEC's ongoing 1993-95 Work Programme, I would like to consider the global prospects for renewable energy in a broader context.

The main reasons for seeking out this wider perspective are: excessive optimism about the scale and pace of renewable energy development existing in many quarters; failure to take sufficient account of existing interests in the fossil fuels sector - the need to recognise the scale of existing investments end employment in fossil fuel provision end use, and both the unavoidable and the surmountable barriers they pose to desirable change;

1New renewable energy includes solar, modern biomass, wind, geothermal and ocean/tidal, but traditional biomass (from fuelwood, crop wastes and animal dung) and large hydro are excluded.

technological, economic, and institutional barriers to the rapid diffusion of new renewable energy supplies; problems of financing the rapid diffusion of new renewable energy supplies; excessive concentration on the potential problem of climate change as the "environmental imperative", whereas most new renewable forms of energy can have (especially if projects are not undertaken within tight and internally consistent environmental criteria) severely adverse local environmental impacts. Local environmental impacts are often taken too lightly by enthusiasts for renewable energy. Too many people seem driven by the sort of "technological imperative" of which they accuse those whom they deem over-enthusiastic about fossil fuel or nuclear alternatives.

I shall deal with these points in turn before setting out the conclusions reached by the WEC Commission and the WEC's Renewable Energy Resources Committee in illustrative (not prophetic) numerical terms. But before I proceed further, for the benefit of those who may have decided this will be a lukewarm or even hostile assessment of the global prospects for renewable energy, let me anticipate the conclusions of the WEC publications considered. Under certain circumstances (an Environmentally Driven Case) as much as 50% of global primary energy supplies could be coming from new renewable sources by the year 2100. A more conventional range of circumstances and evolution would indicate some 25% of global primary energy supplies could come from new renewable resources by the year 2100.

Excessive Ootimism

Regarding over-optimism: over-optimistic views on the speed of technological change, innovation and diffusion are widespread. They fail to recognise that our understanding and models of technology innovation are surprisingly limited. Past experience and realistic prospects do not allow us to predict a massive switch to renewable energy use from fossil fuel use within the space of 20 or 30 years. An appreciation of global population, socio-political, institutional and energy dynamics suggest the necessary build-up will take many decades. The WEC Commission Report looked in some detail at prospects in the period to 2020, and then in broader outline to 2100. It drew heavily on the work of the WEC's Renewable Energy Resources Committee.

Unless determined and successful efforts are made to accelerate the pace of development by effective policy measures and economic incentives, the volume of new renewable energy provision may only rise three or four-fold from 1990 levels by 2020. Given the overall growth of demand for the services provided by energy, reflecting in its turn population growth and development aspirations, this might result in new renewables contributing only 3% or 4% to global primary energy supply by in 2020. With effective policy support this "minimum" evolution might double, to provide a maximum of 10% to 12% of global energy supply from new renewable sources by 2020. In volume terms this "maximum" evolution represents by 2020 an eight-fold increase over 1990 levels.

If we look much further ahead - to the year 2100 - then one can anticipate generations of technological innovation, and radically changed economics. By then one can quite readily sea new renewable energy accounting for more than the world's current total primary energy demand - over 9 Gtoe (gigatonnes oil equivalent).

The point is that to expect vast changes by 2020 is unrealistic. This is not to express complacency. The period to 2020 is the key transitional period if real progress is to be made in diversifying energy sources, abating fossil fuel emissions, and - not least - pressing ahead with energy efficiency and conservation.

In one other sense there seems to be over-optimism. Just because a technology exists at the laboratory-scale, or is available in the market, does not ensure take-up or radical change. IT exists to improve information processing and communication now which could radically transform lifestyles and work patterns. How far have lifestyles and work patterns changed in

ways which reduce energy consumption or raise energy efficiency? In an *Economic Study of the City of London" published in 1967 we (I speak as a co-author) anticipated fundamental changes derived from IT. Developments in the past 27 years have been much more modest than many of us anticipated then.

Exi~tina IntQrests

Huge investments have been made in the provision of the various fossil fuels, in their processing, and in the equipment which uses them. Huge numbers of people are employed in many related activities, and most of us in this world have a financial stake as a result.

We need to shift away from current patterns of energy provision and use. We need also, however, to recognise the barriers and inertia which exist. We need to recognise the implications of the current economic advantages of the available fossil fuels, and the difficulties in achieving "a level of playing field" - not least with respect to the costing and pricing of externalities, including environmental impacts. We may well deplore energy subsidies, but cannot fail to recognise the political and social interests vested in their continuance. We need to recognise the simultaneous, and perhaps competing, claims of nuclear power generation.

These existing interests are also likely to slow down the pace of development of new renewable energy, even though problems - actual or perceived - associated with fossil fuel use and nuclear power may simultaneously spur renewable energy development.

Other Barriers

The cost and availability of the various forms of new renewable energy provide other sorts of barrier to development. In many instances costs are coming down and technological innovation is occurring. But in market systems there is often a reluctance to take the long-term view if the short-term economics seem unattractive. In centrally-planned systems other major errors may occur - and in general government intervention has quite different results from those intended.

Problems of Financing

The financing of energy development in general, and of new renewable forms in particular, provides further challenges. The demand for energy financing in the three decades to the year 2020 is likely to total at least U.S.$30 trillion at 1992 prices. At least 10% of that figure is likely to be accounted for by new renewables, excluding transmission. The total figure is some 50% greater than the world's GDP in 1990. The total figure in the second decade of the next century is likely to be about U.S.$3 trillion annually. Historically, energy investments have accounted for somewhat less than 5% of global GDP but about 15% of global investment expenditures.

The currently categorised developing countries, where the bulk of additional demand for the services energy provides will come, are perceived as requiring at least U.S.$100 billion annually by way of energy investments. Some would claim this is the figure required by the electric power sector alone. At best some U.S.$2 billion per annum has flowed from external private sources. In future, a number of financial specialists have suggested, international financing will not meet more than 15% to 20% of global requirements, and competition for these funds will intensify. Although savings ratios are often relatively high in developing countries by comparison with many OECD economies, the relevant institutions do not exist or do not function effectively to marshall and invest these funds. There are, in any event, competing domestic claims.

Financing new renewable energy development, and energy development more generally, will therefore not be an easy task - especially in poorer and less dynamic economies, or in those

economies unable for other reasons to attract the necessary external or domestic funds. Naturally, many developing country signatories to the UN Framework Convention on Climate Change have optimistic hopes that developed country parties to this Convention will provide the funding and technology they desire. There is liable to be a degree of disappointment here, not least because many ordinary people in developed countries suffer unemployment and constrained incomes, and have other spending priorities. Politicians and tax-raisers will not be unmindful of the relevant forces.

There is also the dilemma that the financing of new renewables development is not helped by poor or uncertain economics of technology and projects. This is something which is confidently expected to improve over time. But it is difficult to counter the argument, widespread at the moment, that if these renewable energy projects were so economically attractive money would be pouring into them.

Environmental Considerations

Finally, in this catalogue of factors constraining the pace of new renewable energy development, there are the local environmental impacts that renewable energy can - and often does - have.

Modern biomass provides both a potential threat and a potential opportunity. A potential threat to bio-diversity, replacing natural forests by monoculture energy plantations, perhaps threatening wetlands. Interplanting, the growth of standing timber, protection of wilderness areas and the deliberate creation of inter-connected habitats on the other hand might not only prevent, but even reverse past, degradation. One needs only to consider the impact of modern farming methods on wildlife species and ecosystems to recognise that potential benefits from modern biomass development cannot be taken for granted. Issues of effluents and disposal of waste have already intruded into modern biomass development. Very particular care, and appropriately strict policies and practices, will be required to avoid detrimental effects. This will include taking account of competing uses for agriculture land (e.g. in South Asia the demands for food of a rapidly growing population); avoiding the risk of accelerating tropical deforestation (e.g. in Latin America); careful drawing on irrigation channels and aquifers; maintenance and improvement of soil quality; and preservation of scenic landscapes.

There will also need to be a realistic assessment of the economics and emissions of biofuels used in road transportation.

A second area of concern is the development of tidal power in estuaries, where this involves barrages and headponds. In the U.K. the various potential sites which have been carefully looked at - Severn, Conwy, Mersey, Wyre, Duddon - all share the problem of substantial ecological impacts.

All are, or incorporate, sites of both national and international ornithological importance. There are, of course, other problems relating to specific sites - siltation, interference with shipping movements, loss of invertebrate and fish populations, risk of water penetration into chemical waste stored underground, and - some would say - unacceptable visual change. Although it has been claimed in the past that tidal barrage energy is "economically attractive", should be confirmed as such, and should be developed (Sir Peter Masefield in "Tidal Power: trends and developments" 1992, pg.1) the present evidence does not support this stance without gross manipulation of the figures. In any event, only a Severn barrage is calculated to produce significant power (around 8.5 GW - 17 TWh annually), and some other schemes seriously investigated would barely produce 0.b6 TWh annually. Outside the U.K. one can cite La Rance, France of which it has been said:

"The total closing of the estuary between 1963 and 1966 during the construction of the plant caused the almost complete disappearance of the original species". (M. Rodier, Electricit~ de France in R. Clare [ed]: "Tidal Power: Trends and Developments", 1992 pgs. 307-308)

Or Canada's Bay of Fundy where concern has been expressed by the Western Hemisphere Reserve Network and others about the possible impacts of further tidal barrage power developments. Or the unfavourable comment that Russia's Kislaya Guba plant near Murmansk has attracted.

Given the wide ranging environmental concerns and poor economics of these barrage schemes, it may be more prudent to pursue alternative tidal and wave power schemes which avoid some of the more critical problems. There are some interesting OTEC schemes proposed for the Indian Ocean, and near-shore tidal stream schemes being examined elsewhere.

Then there are the criticisms which a few U.K. windfarm developments - actual, agreed or proposed - have already aroused. Visual intrusion and noise are the main concerns. With careful siting, good turbine design, and use of a uniform size and design (unlike some major U.S. schemes) these problems in the main can be minimised or avoided. The British Wind Energy Association debated these issues at its 1993 Annual Conference (see my Opening Address: "Energy in Tomorrow's World" in K.F. Pitcher [ed.|: "Wind Energy Conversion", Mechanical Engineering Publications Ltd., 1994.)

In a nutshell, it does not seem prudent to be placing windfarms in the middle of particularly beautiful countryside, or on an important Bronze Age site, or (in the case of a possible 267 x 300 kW turbine scheme) within sight of the finest stretch of the Emperor Hadrian's Roman Wall. The development of wind energy can proceed at quite a satisfactory pace outside excessively provocative locations. Eventually one would hope to see, as one has begun to do in Denmark, off-shore windfarms - of which Vindeby is an excellent example - provided they are located sufficiently far away from major bird migration routes. In this latter respect, the old CEGB proposal for Wells-next-the-Sea, Norfolk would indeed seem to have been provocative. These are all U.K. examples, but for various - and generally related - reasons, windfarm developments have been meeting stronger opposition in Denmark, The Netherlands and the USA recently. They cannot be brushed aside or manipulated away.

There may also, of course, be visual intrusion from the other main forms of renewable energy - solar and geothermal - if large or unsightly structures are built in scenic areas or wilderness habitats. There are also more basic pollutants involved - such as C02, hydrogen sulphide and mercury emissions from existing geothermal plants; to concerns at some of the coatings and films used in solar P.V..

With proper criteria, sensitivity and management, many of the problems discussed here can be avoided or satisfactorily minimised. They will have to be if the appropriate balance between potential global environmental threats and actual local environmental threats is to be achieved. They will, in short, have to be if new renewable energy developments are to proceed in a sustainable manner.

At present, however, there seem to be real problems: of insufficient, and insufficiently clear, constraints on renewable energy development where it should be banned; and excessively cumbersome and costly procedures where environmental and other sensitivities are much more limited. These problems are not confined to the U.K., but one observes that recent U.K. Planning Policy Guidance notes have not really helped their resolution although aimed at tackling the latter one. This provides fertile ground for those who would overstep proper boundaries and yet can justifiably complain about the complexities and delays within acceptable boundaries.

Global Prosoects

Bringing all these factors together suggests new renewable energy development still has excellent prospects in the long run.

That view is more cautious on the pace and scale of development than some recent studies. It would not encompass, for instance, statements of the following generic type:

l0

"Although some environmental uncertainties remain and require further investigation, especially at the site - specific level, no major factors have so far been identified that would inhibit the wider implementation of tidal energy, assuming proper attention to scheme design." (J.E. Cavanagh et al. "Ocean Energy Systems" in T.B. Johansson et al. [eds.] "Renewable Energy: Sources for Fuels and Electricity", 1993 pgs.529-530).

It does recognise, however, that around the world differing needs and priorities will influence the balance of concern between energy provision and environmental protection or renewal.

In the Appendix, Table 1 provides some of the basic assumptions lying behind the WEC Commission's four cases to 2020. They are intended to illustrate possibilities, and are not forecasts. Cases A, B and C were continued through to 2100 in outline.

Table 2 provides the Commission's assumption on energy mix to 2020 under the four cases. Table 3 provides "minimum" and "maximum" figures for new renewable energy by 2020, which can be related back to the figures for Cases B and C appearing in Table 2. New Renewable energy developments in Cases A and B are expected to fall within the indicated range. The implications of these assumptions and numbers will, of course, be profound for the pattern and pace of global energy, social end environmental development. They encompass far too many facets to explore here: the amelioration of living conditions in urban communities; the possible discouragement of a drift from rural to urban areas; local provision of the services required from energy; potentially clean and efficient energy provision; the capacity to move from finite to renewable energy sources; a major contribution to the energy needs of the developing countries. The WEC's "New Renewable Energy Resources" study provides much more detailed discussion of many of these issues.

Table 4 provides the global energy mix assumed for the Commission's three cases extended into the long term, to the year 2100. Tables 5 - 9 provide Regional Fuel Mix assumptions 1990 and 2020 under the Commission's four cases. Table 10 provides energy demand by main regional groupings to 2100 under the assumptions of the three long-term cases.

Finally, Table 11 outlines the possible implications of the WEC Commission's three long-term cases to 2100 for CO2 emissions from fossil fuel combustion and for atmospheric C02 concentrations.

CONCLUSIONS

The global prospects for renewable energy development are bright, but over the next few decades the pace and scale of development are expected to be more modest than many enthusiasts proclaim. This paper has outlined some of the constraints:

the time needed to achieve really substantial change; existing fossil fuel and nuclear power interests, and the investments and employment behind them which make "a level playing field" difficult to achieve; the continuing failure fully to cost and price externalities. other technological, economic and institutional barriers; problems of financing, and the need to balance concerns with potential climate change against the many local environmental impacts of new renewable schemes.

The WEC Commission concluded that, with some very tough assumptions and policies, it was possible to conceive that at the year 2100 global energy demand could still be no more than 20 Gtoe (little more than twice today's figure with double the current world population). New renewables might supply 50% of global energy requirements, all renewables (i.e. new plus traditional biomass and large hydro) about two-thirds. Atmospheric CO2 concentrations might have peaked around 470 ppmv (parts per million by volume), end annual CO2 emissions from fossil fuel combustion might be 60% below 1990 levels.

]1

But it is not just the development of new renewable energy which would have achieved this outcome. Many other actions and policies will have been required - not least, dramatic improvements in energy efficiency and conservation.

REFERENCES

Clare, R. (Ed.) (1992). Tidal Power: Trends and Develooment#. Thomas Telford, U.K. Johansson, T.B., H. Kelly, A.K.N. Reddy, R.H. Williams (Eds.) (1993). Renewable Enerav Sources for Fuel and Electricity. Island Press Washington, D.C.. Pitcher, K.F. (Ed.) (1994). Wind Enerav Conversion. Mechanical Engineering Publications Ltd., U.K.. World Energy Council (1993). Enerov for Tomorrow's World. Kogan Page, London / St. Martin's Press, New York. (Also available in French and Spanish editions.) World Energy Council (1993). Renewable Enerav Resources. WEC, London. World Energy Council (forthcoming 1994). New Renewable Enerqy Resources. Kogan Page, London.