Working Paper: NBER ID: w15081
Authors: Geoffrey Heal
Abstract: Greater use of renewable energy is seen as a key component of any move to combat climate change, and is being aggressively promoted as such by the new U.S. administration and by other governments. Yet there is little economic analysis of renewable energy. This paper surveys what is written and adds to it. The conclusion is that the main renewables face a major problem because of their intermittency (the wind doesn't always blow nor the sun always shine) and that this has not been adequately factored into discussions of their potential. Without new storage technologies that can overcome this intermittency, much of the decarbonization of the economy will have to come from nuclear, carbon capture and storage (CCS) and energy efficiency (geothermal and biofuels can make small contributions). Nuclear and CCS are not without their problems. New energy storage technologies could greatly increase the role of renewables, but none are currently in sight.
Keywords: renewable energy; intermittency; storage technologies; climate change; economic analysis
JEL Codes: Q3; Q4; Q5
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| intermittency of renewable energy sources (Q42) | ability to replace fossil fuels (Q42) |
| low capacity factors of renewables (Q42) | market competitiveness (L11) |
| need for advancements in storage technologies (O00) | full potential of renewables (Q42) |
| intermittency of renewable energy sources (Q42) | reliance on nuclear energy or carbon capture and storage (CCS) (L94) |