By Matt Owens December 12, 2014
This is an excerpt from the chapter titled "Stepping Out of the Trap: Overhaul" of my new book (available as an e-book from Amazon for FREE through December 14, 2014). This chapter focuses on the fundamental physical components of a profitable global energy system overhaul. The print version is due out December 26, 2014.
Wind energy is the primary, ready to install renewable energy resource today. It’s cheap, extremely quick to deploy, easy to integrate into an electric grid, and there’s plenty of it to go around. The levelized cost of electricity from wind power is about the same or cheaper than that from coal, the current fuel source of choice for much of the world’s electricity generation. According to the most recent US Energy Information Administration (EIA) cost comparison between electricity sources (called levelized cost), electricity from conventional “dirty” coal (the cheapest type) is estimated to cost 19% more than onshore wind, while electricity from “clean” coal (which would capture a fraction of the greenhouse gas emissions in a process called carbon capture and storage, abbreviated as CCS) would cost nearly double, at 84% more than onshore wind. By this same set of estimates, only natural gas electricity is less expensive, by about 20% compared to onshore wind, and if CCS costs are added, natural gas becomes 14% more expensive than wind (US Energy Information Administration, 2014 — “Levelized...”).
The price of American natural gas is lower now than it was a few years ago because hydraulic fracturing has increased supply, but this is not the bonanza it has been made out to be. The price of natural gas was already rising sharply before widespread use of hydraulic fracturing, and it has not actually come down very much since. Instead, it seems to have started to rise again. It must inevitably rise, because, like all other fossil fuels, there is a limited supply and insatiable demand from rapidly developing nations. Even the EIA projections call for natural gas prices to rise in the US — and at a faster rate than all other types of energy sources.