Market penetration of renewable energy

The ongoing slow process of market take-over by renewable energy technologies has been linked to political debates and concrete actions to speed up or slow down the transition process. Political initiatives to facilitate introduction have been based on the belief that fossil resources are close to their peak production and will gradually have to be marketed at higher and higher prices, as they physically get more difficult to extract, or in some regions simply get exhausted. In recent decades, a substantial part of the world have acknowledged the reality of increased greenhouse warming as a result of fossil fuel combustion, and used this an the key argument for a rapid introduction of renewable energy sources.

One should also take notice of the strong vested interests opposing renewable energy development: the fossil and nuclear fuel lobbies, large utility preservation organisations and economic advisors opposing any kind of fair market establishment that involves consideration of the different levels of environmental and social indirect costs associated with different energy technologies. It is not enough to have found the overall best solution. There must also be created a political will to implement it despite the possible efforts of loud minority opposition groups. This is a basic challenge to democratic decision-making.

Looking at the economically most viable renewable energy technologies, such as wind converters, the market introduction has been characterised by stop-and go policies in individual countries. Wind energy is an economically viable solution at favoured sites, which can be found in most countries of the world. However, for various reasons the development has been slower than a proper economic evaluation would suggest. Foremost among these reasons is perhaps the liberalisation of the power utility market, which in some countries have been carried through not on the basis of up-to-date, life-cycle assessment type economic thinking, but rather according to the primitive economic theories prevailing in the 18th century, in complete disregard of non-direct cost contributions.

It should be said at once, that life-cycle assessment does not offer four-digit economic comparisons relieving policy-makers from having to reflect upon their actions. Most life-cycle assessments of energy systems are indicative only, but this is also sufficient to state that wind power and certain other renewable energy systems in many places are competitive today, relative to fossil and nuclear alternatives. It is then the job of the responsible government to regulate the market place in such a way that individual customers see relative prices the same way as does the life-cycle assessment.

In addition to wind power, a number of biomass derived energy forms are cost competitive in a life-cycle perspective, including solutions for the otherwise elusive individual transportation sector. Yet, the preference today is to use biomass for simple combustion, an unworthy application with often severe pollution effects.

From a purely scientific point of view, it is difficult to understand the political preference in many countries for continued reliance on fossil fuels, rather than renewable solutions greatly benefiting the environment, and as stated above, in several cases economically preferable from the national economy point of view. We have already seen in Iraq the first outright war over oil resources, carried through in plain disregard for international law by a country shying away from the alternative of improving its own efficiency of energy use, even to the modest average standards of other industrialised parts of the world.

Seen in this perspective, there is little reason to be optimistic based on the rather spectacular results obtained so far by quite modest investments in renewable energy technology. Technical feasibility, decent price and general public acceptance seem insufficient to persuade the political elite and their industrial basis in many parts of the world. What additional arguments should be brought forward? Air pollution, greenhouse gas emissions, fossil resource exhaustion, nuclear accident and radioactive waste unacceptability have all failed to impact sufficiently on actual political decisions, although few would disagree that all the mentioned ones are problems "in the long run". The wicked circle behind this behaviour is connected with political governance being increasingly short-range motivated, probably at least in part due to the influence of media treatment, by media no longer independent and unbiased in their analysis and criticism, but owned by and serving special interests. So it seems tempting to conclude, that while several renewable energy solutions are already ready for the market, the playing rules in the marketplace have to be changed to include long-term human interests, if the marketplace is to become a level playing field. This again calls for political action, which will be taken only when and if the rules of the political game have also been modified to include long-term human interests.

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