The 2015 Sustainable Energy in America Factbook (PDF) is out now, and the solar outlook is somewhat bright. But there are some dark corners of American infrastructure still in need of illumination.
This year’s annual report from the trade and industry coalition Business Council for Sustainable Energy was produced by Bloomberg New Energy Finance, and it’s got mostly good numbers for renewables fans. From 2007-2014, total U.S. investment in clean energy — which the Factbook defines as “renewables and advanced grid, storage, and electrified transport technologies” — totaled $386 billion. Solar and wind have tripled in capacity since 2008, to 87 gigawatts in 2014. Solar’s buildout was 50 percent higher in 2014 than it was in 2013, and “project pipelines today suggest even bigger numbers for 2015 and 2016,” the Factbook explained.
Meanwhile, rooftop solar is the fastest growing form of distributed energy, which on a whole “is prompting a rethink of grids, business models, and buildings,” it added. In 2013, investor-owned utilities and standalone companies poured almost $38 billion into their transmission and distribution infrastructure, while smart meters now cover almost 40 percent of American electricity customers. These dramatic scalings have been made possible by a swirling mix of factors, including federal and local subsidization and incentives like Investment Tax Credit, as well the cratering oil market, which is in turn putting pressure on the transportation sector to green up its dirty game. Of course, solar’s ITC is scheduled for a downsizing in 2016, which could slow down what significant progress photovoltaics have made in the shadow of dirtier but more glamorous energy alternatives, like so-called natural gas.
Indeed, it is natural gas — which is more or less methane, the opposite of clean energy, given that it is orders of magnitude worse than carbon dioxide — that takes up much of the Factbook’s early chapters and executive summary, which trumpeted that both supply and demand are “hitting all-time high.” In fact, the Factbook noted, the dance of market dominance between dirty fuels like coal and natural gas have actually increased carbon emissions from the US energy sector since 2012.
Drilling deeper into the Factbook, a sadder solar picture appears. Policy and funding support for both obsolete coal and flagging natural gas have held back solar’s inevitable ascendancy, given it is the cleanest energy in the mix. Net metering has penetrated a mere handful of states, one infographic explained, but even more have been marred by “fierce debates” over its obstruction and/or taxation. Meanwhile, funding of rooftop solar installations skyrocketed to $12.9 billion in 2014, while asset finance, public market and private equity investment all struggled to get past the $5 billion mark in the same year. Despite Bloomberg and BCSE’s good news on clean energy finance, Wall Street seriously needs to step up its solar bets.
Indeed, by the time you get past the many pages of natural gas cheerleading and finally hit the comparatively smaller solar section, the 2015 Factbook becomes a more depressing tale. Its PV-module-by-country graphic is simply owned by China, which deploys 26.9 percent of global panels, compared to America’s pitiful tenth of 2.7. The next graphic illustrates America’s utility-scale PV build takeoff, from 65 gigawatts in 2009 to 3,847 last year — but the Factbook even throws a wet blanket on that accomplishment, noting that “build is expected to level off this year as the pipeline in California begins to thin” — adding that it was driven by the state’s Renewable Portfolio Standard as a kicker.
Things get worse on graphics for solar’s private equity and asset finance investment, which peaked in 2011. Another few graphs later, including one showing that solar module prices are down by more than 80 percent relative to 2007 levels, and the Factbook’s photovoltaic pages halfheartedly conclude.
Of course, none of this is to say that solar is going away, or even sucking wind. If anything, the Factbook shows what happens when way too many eggs are placed in the wrong basket, namely natural gas, and how that inordinate focus and support wrongly holds back what are much cleaner, smarter energy alternatives with much higher returns on investment. BCSE and Bloomberg’s annual report may have wanted to put on a happy face by focusing on its “one unmistakable theme,” which is that “the broader US ecosystem is clearly preparing for a future in which sustainable sources of energy play a much larger role is becoming a problematic trend.”
But, in the final analysis, although it admits that the US power sector is decarbonizing, the Factbook happily notes (in its executive summary of all places) that the “US is one of the most attractive markets in the world for companies whose operations entail significant energy-related costs.” So if you don’t think that being the destination that natural-gas companies are “flocking to” in order to economically produce methanol and ammonia is synonymous with sustainability, then maybe next year’s report will make you happier.