Episode 5: Everything You Need to Know about Renewable energy
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Utilizing renewable energy is a major key in the decarbonization puzzle for every company. In this episode, Tad explains what renewable energy is, how to use renewable energy to meet greenhouse gas emissions reduction goals, and the future of renewable energy.
What is RENEWABLE ENERGY?
Renewable energy comes in many different forms including solar, wind, hydropower, biomass, and wave energy. Solar panels work when sunlight hits the panels and a chemical reaction occurs inside the polycrystalline panels that produces direct-current electricity. Next, this current goes through an inverter to produce alternating current electricity that we can use to power our homes and buildings. Wind turbines rotate when the wind is blowing and those rotations generate electricity. This process is the exact same as a power plant, except power plants use steam to rotate the turbine instead of wind. Another source of renewable energy is called solar thermal. Solar thermal energy creates hot water through solar panels. Water flows through very dark colored panels and the sun heats the water as it shines throughout the day. Hydropower is produced when a river is dammed and the water flows through it to create electricity. New hydropower projects are not currently being pursued because the process is very impactful and expensive. Biomass can be burned and considered a renewable fuel source, however, it is not ideal because it has to be burned. Finally, researchers are looking into wave energy that could produce electricity from waves in the ocean. There are clearly a lot of options for renewable energy, but solar panels and wind turbines are the most ideal options for companies as of right now.
President Biden announced the goal to slash U.S. Greenhouse Gas (GHG) Emissions by 50% by 2030. This is not the first bold goal we have seen. How can we actually meet this goal?
The first step is to improve our energy efficiency. By making our buildings more energy efficient we can reduce electricity consumption as well as natural gas and other fuel consumption. We can increase energy efficiency in our buildings through insulation, more efficient equipment, and better lighting. An extremely important way to increase our building’s energy efficiency is by reducing your overall consumption of energy. This is called demand reduction and it can be achieved through building and equipment upgrades. Operational changes such as improving programming for how we use energy is also an important step for demand reduction. However, there is only so much you can do to reduce energy consumption, so most companies will probably have to begin utilizing renewable energy. There are few different ways to utilize renewable energy. The first option is buying green power from your electric utility instead of getting a mix of standard grid energy. For this option, you would specify and pay a little more to get allocated electrons that were generated from renewable systems. This is called a green supply contract. Another option is to install solar panels directly on your property, but a lot of companies choose not to invest in this because it is very expensive. A popular option for companies it to do Power Purchase Agreements where a solar developer builds solar panels on the property. The solar developer owns all of the equipment and sells the electricity to the company at a reduced rate for the use of their property. Companies usually enter into a 10-15 year contract with the solar developer to do this. However, if a company does this, it is important to retain the ownership of the Renewable Energy Credits (RECs). These are tradeable units that give you the right to make a claim that your building is powered by renewable energy. If you do not own those RECs, someone else can buy them and make their own claim that their building is powered by renewable energy regardless of the fact that those panels are on your property. Finally, some companies are entering into a Virtual Power Purchase Agreement where they are investing a large sum of money in the development of a large scale renewable energy project.
what WOULD OUR FUTURE LOOK LIKE IF WE WERE ABLE TO MEET THE GOAL OF SLASHING U.S. GHG EMISSIONS BY 50% BY 2030?
A large amount of GHG emissions come from transportation. We will see more electric vehicles and renewable development as well as new technology that will allow storage of energy. We are a very energy intensive society and we all use a lot of electricity, so we won’t be able to magically make a full switch to renewable energy in the next 9 years. This process will be happening steadily over time and we are already seeing the grid mixes changing. Every year there are more and more renewable energy systems coming online, but it is still a small percentage of the overall electricity production system and it will take massive investment to install all of these systems. We will also see a lot more companies investing in these virtual power purchase agreements where they are part owners, or investors on these big renewable energy projects which will continue to drive much cleaner renewable energy while reducing GHGs.
