A 16-hour flight and more than 5,500 miles separate Sacramento, California from Berlin, Germany. Yet, the size of their economies and the progressive energy policies they have adopted have created a common bond between them. On the world stage, California’s $2.9 trillion economy would make it the world’s 5th largest economy, just after Germany’s at $4.4 trillion. But perhaps more importantly, they have both adopted aggressive renewable energy targets that have resulted in expensive and unreliable power.
Renewable energy targets (RETs) are government policies that mandate adding specific renewable energy amounts to the power grid. Policymakers often credit RETs with accelerating renewable energy growth, but a new study finds that they may do more harm than good.
The University of Queensland in Australia has found significant issues with renewable energy targets. Nations like Germany and states like California have often implemented them without regard for their full impact on both consumers and the power grid. The problem? Failing to consider the global implications of these goals means consumers facing blackouts or that renewable energy technologies may not be implemented sustainably.
“Setting a target – a quantitative threshold to be attained, such as 80% wind energy — rather than an objective — a qualitative direction in which to go, such as working to maximize wind energy — can blind us to trade-offs when evaluating different policy actions,” says Ph.D. candidate Scott Spillias, from UQ’s School of Earth and Environmental Sciences, in a press release.
“They can also create psychological incentives to act quickly to implement them,” Spillias adds, “causing decision-makers to lose sight of the more fundamental objectives that motivated the target in the first place.”
The fact is RETs have a poor track record in many countries that have implemented them. For example, Europe’s Renewable Energy Directive is actually on track to increase carbon emissions, not reduce them. Ouch.
Germany faces similar problems. Western Europe’s economic giant has some of the most ambitious renewable energy goals in the world, with plans in place to generate 65% of its electricity from renewables by 2030. But at what cost? Just ask the average German ratepayer. Germany now has the unenviable distinction of having some of the world’s highest electricity rates. At the same time, the country has not decreased its emissions at all. This policy failure primarily results from Germany’s reliance on coal-fired power for reliability purposes, compounded with a simultaneous phase-out of emission-free nuclear power. That’s simply a bad bargain for consumers.
In the U.S., California is a significant example of RET related problems. The Golden State has some of the most aggressive renewable energy goals in the country, with massive amounts of solar panel deployment. Unfortunately, California has faced rolling blackouts in recent months, primarily due to an over-reliance on intermittent renewables without enough baseload generation or energy storage available.
“Targets may or may not be appropriate tools to use for renewable energy development,” Mr. Spillias explains. “We argue that, instead, a rigorous decision-making process should be undertaken to evaluate the trade-offs between different sustainability objectives with respect to a variety of possible targets and/or other policy instruments.”
We agree. Generating cleaner energy is a worthwhile goal when implemented in a fashion that makes sense for consumers. But renewable goals have to be balanced against both engineering realities and consumer outcomes. If not, setting arbitrary renewable energy targets without regard for how they may affect the power grid comes with significant consequences for delivering affordable and reliable energy.