Wind turbines and solar panels are inexpensive sources of energy. The issue is that not enough of them exist.
President Jimmy Carter put solar panels on the White House roof more than 40 years ago. Carter cautioned that this technology might turn into “a curiosity, a museum piece, an example of the road not taken” in his speech announcing the panels. Alternatively, he expressed optimism and said that it would be a turning point for the nation, “harnessing the power of the sun to enrich our lives as we move away from our crippling dependence on foreign oil.”
Solar energy has grown significantly in recent years, and the technology is now much more than just a curious curiosity. It’s beginning to deliver on its promise of abundant, affordable, and clean electricity.
Carter’s installation of solar panels on the White House was historic, but the cost of the panels was prohibitive. It served as a metaphor for what it meant. “It wasn’t a business decision,” stated Arvin Ganesan, CEO of energy storage manufacturer Fourth Power. “What’s happened since then is that the cost of renewable energy is now the cheapest way to generate new electrons on the grid.”
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Even while using renewable energy instead of fossil fuels, which worsen global warming, is now more affordable, your power bill can still be rising. What’s going on, and when will things change?
Costs of electricity are still on the rise.
The cost of converting solar energy to electricity is not very high. But when the power bill comes in, it doesn’t feel like inexpensive energy anymore.
The US Bureau of Labour Statistics estimates that between February 2023 and February 2024, average power rates climbed by over 3%.
The issue: There isn’t nearly enough of that inexpensive renewable energy available. According to the US Energy Information Administration, fossil fuels still provide around 60% of the country’s power, with natural gas accounting for 43% of that amount.
This implies that fluctuations in oil prices, which may be impacted by global conflicts, extreme weather, and other instability, might affect most of the grid.
In the meantime, the amount of our power that originates from renewable sources is constantly decreasing. According to a 2022 International Renewable Energy Agency study, the price of energy generated by solar and wind power decreased by at least 13% worldwide.
According to Francesco La Camera, director-general of IRENA, “renewables are by far the cheapest form of power today.” “2022 serves as a sobering reminder of how commercially feasible new renewable energy generation has grown. Renewable energy reduces energy costs, boosts market resilience, and releases economies from the erratic price and import of fossil fuels. This is especially true if the current energy crisis lasts longer.”
Ganesan, whose business is involved in the development of thermal battery technology, attributes our current state to technical advancement.
“The efficiency of solar panels is just significantly better at this point,” he said. “The output of a solar panel is now highly efficient. And what caused that is a lot of projects the government catalyzed over that intervening 20 years to bring down the cost of renewables. So it was government R&D, government intervention that launched this revolution to bring low-cost, high-efficient solar panels to the market. And the same is true for wind.”
Who is going to foot the bill for the energy shift?
Even with the move to more affordable, environmentally friendly, and renewable energy sources, customers continue to have low opinion of the energy system. According to a recent analysis, consumers believe that it is their own responsibility to make changes and that there is a diminishing level of trust in the energy system. This information was provided by global accounting and consulting firm Ernst & Young. Americans believe that the energy business should bear a greater share of the burden of the energy transition.
Just 30% of Americans “feel confident their energy will remain affordable,” according to a study of 3,000 US customers. Additionally, “consumer confidence towards the US energy system” fell to 56.9% from 65.8% in 2022.
Additionally, it revealed that the majority of Americans (68%) think “they are doing everything they can to be sustainable” and that the lead in the transition to cleaner energy should come from local governments (42%), oil and gas firms (38%), and energy providers (65%).
The report’s principal author, Greg Guthridge of EY Global Energy & Resources Customer Experience Transformation Leader, stated that he wasn’t surprised by the results. “There’s this big gap, and that’s exactly what we expected to see,” he stated. “The early adopters moved, and now we need to find a way to activate those who either can’t or won’t move, at the moment, through the energy transition.”
Chris Ventura, executive director of the Consumer Energy Alliance’s Midwest chapter, stated that consumers find it particularly difficult to drive the market since even those who are prepared to transition to cleaner energy aren’t always able to do so. Not everyone can access programmes like Solar for All and community solar, which attempt to increase access to solar electricity beyond rooftop solar systems.
“For the vast majority of people out there, it’s going to take some time,” Ventura stated. “If you adore renewable energy and want to install a solar panel on your roof, you can do so if you own your property, unlike an iPhone, which doesn’t care where you live.
Similar to the respondents to Ernst & Young’s consumer survey, Ganesan stated that in order to address “systemic issues,” less should be expected of individuals and more should be focused on systemic reform.
“I absolutely resonate with the idea that people feel overburdened in general and don’t want this to fall on their shoulders,” he stated. “One out of five people can’t afford to pay their electricity bill in the United States, so to have the solution fall exclusively on their shoulders is not fair, especially when governments and utilities are much better poised to deliver the solutions.”
