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Concentration of CO2 in the Atmosphere

Business to Thrive in a Coming Economic Boom

ORPC, based in Portland, Maine, develops generating technology based on moving water. This RivGen power system now provides power to a village in Alaska. Credit Ocean Renewable Power Company.

George Harvey

Here at Green Energy Times, we see an impressive amount of real news. It leads us inescapably to an understanding that is a little different from some things one hears today. We have come to a strong belief that, unless we go seriously astray, we could be heading into an economic boom that will be unlike anything ever seen before. And that is because climate change is almost without doubt the biggest business opportunity ever to face humanity.

There are fearmongers who go on endlessly about how bad things will be if we try to get all our energy from renewable resources. Groups paid for by fossil fuel interests talk about the trillions of dollars that will have to be spent on new infrastructure. They talk about lack of reliability and increased costs. We should remember, however, that there could be a causative relationship between who supports them and what they say.

One really important issue is that dealing with climate change means employing millions of people at thousands of businesses for dozens of years. As part of his presidential campaign, Washington’s Governor, Jay Inslee, called for spending $9 trillion of investment creating eight million jobs, according to the Huffington Post (http://bit.ly/Inslee-plan).

One important aspect of renewable energy is that prices will almost certainly decline. Solar and wind power are already at parity with the least expensive fossil fuels in most of the United States (http://bit.ly/Lazard-LCOE-12). Wright’s Law of economics suggests that they will only continue to decline. (Please see an article at CleanTechnica, which I wrote, for more, http://bit.ly/CT-prices-dropping.)

All this means that spending money on renewables will save us money, especially because many fuel-burning power plants are old and need to be replaced anyway, making further investment in them unnecessary.

Battery prices have dropped to the point that utilities are already using them instead of the more expensive natural gas peaking plants. An article at CleanTechnica says the firm 8minutenergy is actually building a 520-megawatt-hour (MWh) battery in Nevada, which it claims will deliver power at $35/MWh (http://bit.ly/CT-8minute-battery). This is less than a quarter of the $152/MWh to $206/MWh energy from the natural gas burning peaking plants costs, according to Lazard’s Levelized Cost of Energy Analysis, Version 12.0 (http://bit.ly/Lazard-LCOE-12). Furthermore, the quality of the electric supply from batteries is significantly greater than that from fossil fuels and nuclear power, because batteries can respond to changes in demand instantly, and fossil fuel technologies cannot. Since batteries compete with peaking plants, it seems a lot of them will be built, and this means there is investment opportunity.

There are other benefits to this possible economic dynamo. Renewable investments mean our energy will be increasingly secure. This is partly because transmission lines are the most vulnerable parts of the grid and most renewable power sources will be closer to the customers. In some cases, they are at customer sites in microgrids which can continue to operate when grid power is down but often provide really inexpensive electricity when the grid is working, as an article at Climate Central explained (http://bit.ly/CC-microgrids).

Coal plants have been closing, and now natural gas plants are beginning to do so, because they cannot compete with renewables. An example, discussed in an article at CleanTechnica, is a natural gas plant in California, which GE is closing with a loss of two-thirds of a $1 billion investment (http://bit.ly/GE-plant-closing). But GE’s loss represents another investment opportunity which is why the company is now focusing on renewable energy.

Transportation is an important issue for renewable resources. Technology is improving rapidly, and costs are going down. Sales of EVs are mounting worldwide, according to GreenTech Media (http://bit.ly/GTM-EV-sales). At the same time, despite this growth, the overall car market is down, because gas mobile sales are off sharply.

Home heating costs are declining rapidly. Behind this is a surge in sales for both heat pumps and efficiency. Read just about any issue of Green Energy Times for examples of this and other advances in renewable energy.

Who would have thought airlines would represent a renewable power investment opportunity? Harbour Air, in Vancouver, is converting all 41 of its seaplanes to electric power. Photo: BriYYZ, CC-BY-SA 2.0 generic, Wikimedia Commons.

There are possible blocks to development, but they are almost entirely political and not based on economics in any way (apart from fears of stranded assets from those who still push fossil fuels and pay for political campaigns). We might examine a series of examples for this.

The electric bus (ebus) industry is expected to grow to $85 billion per year by the end of 2023, according to an article in MarketWatch (http://bit.ly/MW-ebus). Nearly all of this business activity is in Asia, with most of it in China. The U.S. position in the ebus market is so small that the article barely mentions it, as the country is held back from a lucrative market by lack of interest. Since the payback time for the extra costs of an ebus is so favorable, this will change in the U.S.

Most photovoltaic (PV) cells and panels are made in China. The U.S. produces very few. To protect the jobs of workers in two plants, both owned by foreign companies, we entered into a trade war. The result is that Americans pay more for PVs, and China has lots to ship to other countries. And China finances at least some installations by using potential military sites as collateral.

Neodymium, which is used for magnets in wind turbines, is mostly mined in China. We have mines, but ship the ore to China to be processed. Now that trade could be held hostage by the Chinese in a trade war, giving a big advantage to Chinese wind turbine makers, according to a Reuters article (http://bit.ly/US-dependence-on-China).

While we are being held back by oligarchs in Washington D.C., we can understand that the situation will not last forever. Whether it is because of investment potential or because the damage of climate change becomes too much to bear, we will respond. We hope it will happen within the next year or two. But we can be assured that when that time comes, investors who act on the facts, instead of “fake news,” will have a lot to invest in. And at that point, America will have a real opportunity to be great again.

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