Two Things the Transition to Clean Energy Can’t Do Without

Recent legislation such as the Bipartisan Infrastructure Law and the Inflation Reduction Act gives a massive boost to the nation’s efforts to achieve a clean energy transition.  The energy transition is a global transformation of energy systems away from fossil fuels to renewable and clean energy sources by 2050.  This is necessary to ward off the worst impacts of climate change.  The transition will require us to change our current energy sources, systems, economics, policies, and our behavior.  A large expansion of renewable energy sources is needed, coal and oil must be phased out, and energy efficiency must increase.  This will not be easy, but to take the steps to reach these goals, 2 crucial things are needed: Money and Land.

Money

A network of energy efficient renewable energy requires great investment into minerals, metals, and construction materials to produce the same amount of energy as a fossil fuel system.  Money needs to be invested up front.  According to RBC Capital Markets, achieving net-zero by 2050 will require “the largest reallocation of capital in history”.  Estimates range from $125 trillion to $173 trillion by 2050.  While these are massive sums of money, $5.9 trillion was spent supporting the fossil fuel industry in 2020 alone.  Shifting traditional investments of this size from fossil fuels to renewable energy puts the world on pace to reach net zero by 2050.  Upfront expenditures result in long-term savings for the world due to improved energy efficiency and lower maintenance costs.

Investment capital is needed for continued research and development into new technologies, long-term battery storage, better insulation materials, and advanced nuclear energy.  Investments are also needed to develop green fuels and green hydrogen for difficult-to-decarbonize sectors that run on intense heat or fuels with high energy density: aviation, shipping, long-distance trucking, and concrete and steel manufacturing.   Decarbonizing and upgrading the electrical grid and expanding global supply chains to distribute renewable will also require capital.

Martin Dietrich Brauch, a lead researcher at the Columbia Center on Sustainable Investments (CCSI) argues, “To make the energy transition a reality, we need both public and private finance.  Developing counties, in particular, need substantial amounts of grants and concessional financing from multilateral development banks and development finance institutions, as well as measures to strengthen local financial sectors, to leverage private sector investment.”

Land

Large solar and wind farms need 10 times as much space per unit of energy as coal or natural gas power plants.  Replacing a one-gigawatt gas plant with a one-gigawatt solar farm would increase land use from 350 to 40,000 acres.  Wind Turbines, are often spaced a half mile apart, could require 30,000 to 250,000 acres to produce one-gigawatt of electricity.

This amount of land is becoming increasingly challenging to find.  Many of the best sites for renewable energy are already being used.  Suitable sites that remain are going up in price as cities expand and real estate companies search for property to develop.  The areas with the highest potential in the US are not where energy is needed the most.

Another challenge is storing the energy produced.  As more and more solar and wind farms are developed, there is a need to store the excess energy.  Excess energy can be stored in lithium-ion, lead-acid, and flow batteries.  Facilities are needed to house these batteries.  Storage is crucial to renewable energy because when energy production is low due to natural or economic events, storage centers will have the capability to supply energy.