Renewables Are Slowly Approaching Diminishing Returns
Once a source of hope for maintaining our modern lifestyle, renewables are close to hit diminishing returns (i.e.: providing less and less benefit to society with every addition of a new solar panel or wind turbine). For the record: fossil fuels have long passed the same point, where drilling another well or opening a new mine eats up exponentially more resources and energy than the previous one — not to mention kicking CO2 levels even higher. The question is: can we continue high tech civilization now based on renewables, or are we about to hit the same limitations as with every other technology we have used in the past?
Providing data to substantiate claims of hitting diminishing returns is not easy. It goes well beyond “simple” return on investment calculations — it takes a holistic approach, a real cradle to grave assessment if you like. So far I haven’t came across such study (Simon Michaux’s work comes closest), so if you are an independent researcher or student looking for a PhD topic, feel free to elaborate on the subject— just please let me know what you have found.
Until then — as usual — treat the following as thought experiment, and see if it makes sense to you. As always, use your critical thinking skills and don’t take anything I (let alone uneducated people in the mainstream media) say at face value. With that aside let’s see what may be the ominous signs of society hitting diminishing returns when it comes to deploying ‘renewables’ at scale.
First, let’s take this tiny piece of news from my little country. Hungary has stopped accepting feed in from all new solar installations since last autumn — rooftop solar on family homes included. One could argue how this was a result of bad policy decisions, mismanagement, electricity price caps or what have you — or, start to think critically about the subject. As my tiny corrupt nation is far from being the only one making such decisions (like drastically reducing feed in fees, well below the economic point of return in sunny California), my sixth sense tells me that we are facing systemic issues here.
There is a growing sense that our electric grids are not quite up to the task when it comes to accepting large amounts of ‘renewable’ electricity. Take the following piece of news from ‘the free market solves everything’ capital of the world: the United States. Lacking even the slightest sliver of technical understanding, economists writing the above essay (besides giving many other ‘great’ investment advice including ‘one effort to place nuclear fusion reactors on the moon’), conclude the problem can be solved by spending more money. Simple as that. Before we move on with the money spending proposal though, we have to understand a few things first.
- Renewables are inherently and hopelessly intermittent. They produce electricity on their own schedule based on the weather and the time of day — completely disregarding the actual electricity demand. They overproduce during windy and sunny days, and terribly under-produce during the evenings when demand tends to be the highest.
- In order to make up for this inherent flaw, some sort of storage must be attached. As you could expect this would increase costs by 30–40% at least, making the whole proposition to install solar on your roof to fend off increasing electricity prices preposterous. Adding battery storage to a family home would push the payback period well beyond ten years, or the practical lifetime of many parts of the installation. The situation is not at all much different when it comes to large national grids neither. Lion Hirth in his 2013 study titled: The Market Value of Variable Renewables — The Effect of Solar and Wind Power Variability on their Relative Price has found that adding wind above 30% of the total electricity produced and solar above 15% effectively halves their market value (reducing it to 50–80%) — exactly because of the additional investments needed to maintain grid stability… At least until the next level is reached where utilities would need to invest further still in ever more sophisticated and complicated equipment and storage. Thus the statement that solar and wind is cheaper than fossil fuels is only true so far as they are kept well balanced by the old and polluting technologies they aim to ‘replace’.
- Economic growth hinges on cheap energy. If the cost of let’s say electricity rises disproportionally (compared to the other costs/benefits of running an economy) people and businesses start to think hard how to conserve and buy less, and definitely not how to expand their consumption. Since no economic activity can be done without spending energy first, every effort will be made to reduce every spending other than energy: investments included. Hoping that electricity prices will be raised (and stay) high enough to justify additional spending on storage is in fact hoping for a recession inducing, industry killing energy price levels — like the ones we have right now in Europe.
- Currently all industrial activity, including the production of polysilicon wafers to build solar panels from, or mining and smelting rare earth metals to build strong magnets for wind turbines and electric motors hinges 100% upon the availability of cheap and abundant fossil fuels. From mining excavators, dumper trucks and freight ships gulping diesel by the barrel, to smelters running on stable process heat and electric currents generated by coal and natural gas, fossil fuels are everywhere… So far not a single solar panel or wind mill on Earth was produced with ‘renewable’ electricity only (from mining to installation, fully off the grid, and not backed up by fossil fuels or accounting tricks). It is thus not irrational to assume, that once fossil fuels are gone, renewables will be gone as well. Without the slightest delay. If you think otherwise, tell me why there aren’t real world projects running at the moment aimed at proving the extraordinary claim that renewables can indeed be produced solely by renewables…? I guess you start to see my point.
- All renewables (and everything electric) hinges on the availability of copper, a finite raw material found in ever lower concentrations ever further away from civilization, requiring ever more fresh water, and yes diesel fuel, to get year after year as cheap to extract deposits slowly deplete. As these resources become more expensive (and scarce) together with ever degrading ore grades, copper mining will first simply turn unprofitable then stop. This is the prime reason behind a looming copper shortage, despite demand (at least in theory) shooting through the roof — and not a ‘lack of investment’. Mining companies are waiting for prices which would bankrupt most customers — so that they can extract the remaining (more expensive) copper for whoever is left.
- Finally we arrive at the ominous topic of waste streams. Wind and solar has 15–25 year lifespans, while coal fired or nuclear power plants easily last five decades, or more. This means, that we would have to build at least twice as much renewable power to fully replace traditional sources given the same time period. (This is not to mention the fact that actual power production from ‘renewables’ tend to be much lower than their nameplate capacity — see point #1 above.) One could thus safely assume a one to four replacement ratio (if not more) over the next fifty years... In other words: you would have to build at least 4 wind farms to replace 1 coal fired power plant of the same capacity over the period of the next 50 years. This approach, of course, would produce megatons of unrecyclable waste: from windmill blades (made from petroleum derived resins) to polysilicon wafers doped with rare but poisonous metals and to the countless tail-ponds containing millions of cubic meters of acidic waste water full of heavy metals, left behind by mining.
Knowing all this, it is not at all that hard to figure out what would happen should electricity companies manage to shake the magic money tree hard enough, and be covered in enormous amounts of cash… Enough to invest in ‘smart grids’. Should they really want to solve the problem of intermittency caused by adopting too much ‘renewable’ power, they would need to build interstate connections (requiring thousands if not millions of tons of aluminum for the transmission cables and untold amounts of copper for the high voltage transformers and ‘smart’ switchgear and inverters), as well as gravity storage, battery farms and much more. All this in parallel with replacing the now ageing old electric grid causing wildfires and outages... As a result we would see:
- Copper prices shooting through the roof, making most of the return on investment calculations on smart grids go south.
- Significantly increased diesel and freshwater demand from mines ramping up production in the remotest of locations from the bone dry Andes, to the lush forests of the Congo basin. New infrastructure would have to built at a great resource expense (roads, railways, electricity transmission cables together with power plants burning coal or natural gas supplying mines and refineries with power).
- A similar ramp-up in deforestation, toxic tailpond creation would follow suit with accidents poisoning nearby waters becoming even more frequent... Not to mention increased CO2 emissions.
- Production of lithium, cobalt, germanium and the countless other rare metals needed for the transition would need to be ramped up in an even bigger fashion, as demand for these rare substances would rise many hundredfold compared to today’s level.
- Overall, this would require us to mine more earth in the coming decades than what we have done in the past ten millennia. Mining and fossil fuel companies would be enriched beyond measure and be urged to invest further in new oil wells and mining pits — bringing the inevitable depletion of these resources (together with climate breakdown) even closer.
- Remember, fossil fuels are way past their point of diminishing returns. The net energy provided to society by them is already falling and would do so even more rapidly should we embark on this mission. We have run out of time and scale to electrify our world.
Diminishing returns are rapidly approaching for renewables. In order to add more of them to the grid, electricity networks would need to be overhauled completely. Should any country with enough money embark on such a mission, it would quickly end up out-pricing competing national grids from the market of finite resources making the shift rather unjust and uneven. Still, should this insane approach succeed, despite the many currently insurmountable technical challenges, it would leave the said nation replacing its fossil fuel based grid with a renewable one at a great material and environmental cost in the name of CO2 emission reduction, but no added economic benefit whatsoever. This new grid would generate the same old 24/7 electricity for its same old industrial and residential customer base, who are now ditching fossil fuels and demanding even more juice than ever… to make same old stuff they used to make before the transition.
This would of course result in a manifold increase in technical and societal complexity, with an additional burden of a twice as frequent replacement schedule compared to old technologies. The whole grid would require a complete overhaul with inverters, smart switchgear, rapidly ageing solar panels, defunct windmill gearboxes, broken blades and all the rest every two decades (or even less for sensitive electronic components and batteries). We would quickly end up in a scenario where a significant (and ever increasing) part of the economy would be working day in day out to replace or recycle equipment and mine and smelt metals for what cannot be recovered from broken stuff… All this in order to maintain an electric grid of byzantine complexity with no backup left (like natural gas, oil or coal).
Electricity would become absolutely indispensable for every part of the economy — manufacturing the very equipment making it all possible included. All this would come at an ever increasing cost, as old mines (providing the necessary backfill for unrecyclable components) deplete and new mines producing ever lower quality ores would need to be built. Just imagine how much of the natural world be left after a couple of replacement rounds into the process.
If all this sounds impossible a challenge, then maybe it is.
Should we go back to fossil fuels then? Well, that ship is long gone, as I keep telling over and over again. Oil may have already passed its peak production in 2018, and its long decline due to natural depletion is now on the horizon. As oil is essential in producing almost everything, the slow depletion of it would bring the decline of natural gas and coal production closer and closer as well…
This is not to mention the fact, that we have already passed every safe threshold of atmospheric CO2 concentration. The last time it was this high as today, global temperatures were 3–4 degrees higher, with no ice caps on either poles, and no humans floundering around. This gives us ample reason to avoid any and every additional release of climate gases starting here and now — mining and building stuff included.
What’s the solution then? Societies should re-learn how to live with less and less energy and ultimately without electricity or fossil fuels altogether in the coming decades and century. Will they do that? Not a chance. Since energy is the economy, less and less of it would mean lower and lower economic activity. This would quickly translate into lost profits and unservicable debts (government and business alike), leading to defaults and a general loss of products and services. No one would vote for that.
It is thus not hard to fathom why everyone is interested in upholding the status quo one way or the other. No wonder that everyone is hiding behind walls of denial either: the fossil fuel cult readily denies depletion and climate change, while the renewable camp denies pollution, technical difficulties and well, yes: depletion of finite mineral resources on which all of their techno-utopia depends.
There is only one entity in full awareness of reality: Nature. Depletion of her rich oil, as well as metal deposits, will thus teach us the hard way what we can or cannot achieve, irrespective of what we want to believe is possible. The coming decades will be about adopting to these basic realities as well as to our rapidly deteriorating ecological situation. A paradigm shift, away from mass consumption — and high energy use — in one form or another is in short order.
Until next time,