The Energy Transition Show with Chris Nelder

According to the International Energy Agency (IEA), almost all of the growth in global clean energy spending is happening in advanced economies and China, while the two-thirds of the global population that live in emerging market and developing economies are receiving less than one-fifth of the total. The reason? The high cost of capital. But why is the cost of capital so much higher in emerging economies than in advanced economies? Why is it still so much harder and more expensive to finance clean energy projects than it is to finance fossil fuel projects in those countries? And what can be done about it? In this episode, we speak with a solar project developer working in Costa Rica to try to answer these questions. Building on our previous discussion from Episode #21, we try to explain why so little progress has been made, especially by the multilateral development banks (like the World Bank), in reducing the cost of financing for renewable energy projects in emerging economies. We review the different roles that various financial institutions play in financing the energy transition, and we ask what needs to change to unlock the flow of capital into energy transition solutions (especially distributed solar). We also put the risk and reward of investing in those projects in a fresh context, and call upon banks of all kinds to start acting in more creative and ambitious ways to take bolder action and get capital deployed where it is most needed, and where it can do the most good.

How much of a role might wind, solar, nuclear, transmission, power plants equipped with carbon capture and sequestration (CCS) technology, or direct air capture of CO2 play on a 100% clean power grid? Which mix of those technologies would provide the cheapest pathways to a clean grid? And once we have met 90% of the need for grid power with clean generation, what will we need to meet the last 10% of the demand for grid power? Will it be ‘overbuilt’ wind and solar? Dispatchable geothermal, hydropower, and bioenergy generators? Seasonal storage using hydrogen or batteries? Conventional fossil-fueled plants with CO2 capture? Or might it be some mix of flexible demand technologies? Or some or all of the above? For that matter, how certain can we even be about modeling the possible solutions years or even decades ahead? Are there solutions that might play a large role in the future but that we can’t yet model very well? How confident should we be that whatever the solutions turn out to be, we will end up with not only a grid that is completely free of carbon emissions but also one that is fully reliable? In this episode, we speak with a senior researcher at the US National Renewable Energy Laboratory (NREL) who has been researching and modeling grid power for many years. In this quite technical discussion, we review two new NREL reports that address these questions and show that producing a 100% clean power grid is not only technically feasible by a variety of pathways but also commercially feasible and ultimately, cheaper than continuing to run the fossil-fueled power grid we have today.

This is Part 2 of the first series in a new format we are piloting for the Energy Transition Show. Instead of exploring a particular topic with one guest who has a non-commercial perspective, as most of our shows so far have done, this new format aims to tell the stories about how the energy transition is proceeding in some of the places Chris visits in his travels. Through interviews with multiple local experts, including those who are working in the energy sector, we hope this new format will help to demonstrate how the unique challenges and opportunities in every place will determine its particular path through the energy transition. We are kicking off this new show format with some stories about Vermont for a simple reason: When it comes to the energy transition, Vermont stands out as a place that punches way above its weight. It has innovated numerous policies and mechanisms to reduce its energy consumption and carbon emissions that have been emulated by other US states. And it continues to serve as a model to the rest of the country for effective energy transition strategies. You’ll learn more about all of these accomplishments, as well as what makes Vermont such an exemplar in the energy transition, in this two-part miniseries based on interviews with eight local experts. Part 1 was in Episode #186, in which we discussed the supply side of Vermont’s energy picture. In this second part, we look at the demand side. Interviews with guests featured in this episode were recorded from October 11-15, 2021.

This is the first show in a new format we are piloting for the Energy Transition Show. Instead of exploring a particular topic with one guest who has a non-commercial perspective, as most of our shows so far have done, this new format aims to tell stories about how the energy transition is proceeding in some of the places Chris visits in his travels. Through interviews with multiple local experts, including those who are working in the energy sector, we hope this new format will help to demonstrate how the unique challenges and opportunities in every place will determine its particular path through the energy transition. We are kicking off this new show format with some stories about Vermont for a simple reason: When it comes to the energy transition, Vermont stands out as a place that punches way above its weight. It has innovated numerous policies and mechanisms to reduce its energy consumption and carbon emissions that have been emulated by other US states. And it continues to serve as a model to the rest of the country for effective energy transition strategies. You’ll learn more about all of these accomplishments, as well as what makes Vermont such an exemplar in the energy transition, in this two-part miniseries based on interviews with eight local experts. In this first part, we talk about the supply side of Vermont’s energy picture. In the second part, we’ll look at the demand side. Interviews with guests featured in this episode were recorded from October 11-15, 2021.

Phasing out the old while simultaneously building up the new is always a challenge, and perhaps never more so than with the energy transition. Can we coordinate replacing fossil-fueled assets with clean, zero-carbon assets so that both systems remain functional and affordable during the transition? And how can we ensure that disadvantaged communities don’t get left behind in the process? In this episode, we continue to explore the theme of the “messy middle” of the transition, building on our previous discussions in Episode #177 and #181. Not only should we expect a large degree of direct government intervention in the process of the transition, because it’s just too difficult and complex to leave everything up to the action of markets, it can be a welcome intervention. Someone needs to plan how to orchestrate the retirement of dirty assets with the construction of clean replacements while keeping everything running. For example: Can we leave it up to the private sector to ensure that enough gasoline filling stations stick around to meet the needs of people still driving internal combustion engine vehicles while we’re in the process of building up enough EV charging infrastructure to meet the needs of drivers who are going electric? Probably not. Some elements of the transition will be far more successful if they are planned and guided. In this conversation, Emily Grubert points out some of the challenges of the “mid-transition,” as she and her co-author Sara Hastings-Simon call it, and how policymakers ought to be thinking about how to orchestrate it so that no one gets left behind.  

Do renewable energy sources generate enough energy ‘profit’ to make them worth continued investment? And is any energy profit large enough to run our modern world, as renewables displace fossil fuels? Some skeptics of the energy transition have claimed that renewables can’t run our world because the net energy they deliver to society is too low. They make this argument drawing from past data for the Energy Returned on Investment (or EROI) for various fuels, which showed high EROIs for extracting fossil fuels, and low EROIs for very early generations of wind and solar technology. However, the historical EROI literature has been plagued with methodological inconsistencies so how reliable is this legacy data for guiding modern outlooks? In a new paper we discuss in today’s episode, a group of researchers has cleaned up and rectified recent EROI data so that the various fuels can be compared on an apples-to-apples basis. Their new results paint a very different picture from the old literature. Not only do renewables have sufficiently high EROIs to power our society, they are much higher than the EROIs of the fossil fuels they are replacing! In fact, these results suggest that only through the energy transition can we maintain a functioning society. To walk us through this new paper, its lead researcher, Dr. David Murphy, an environmental scientist at St. Lawrence University in New York, returns to the show. In addition to reviewing the results of this new paper, we’ll also talk about some of the other mistaken arguments that are frequently made against the energy transition, and explain why they are wrong.

What began as a “global energy crunch” one year ago, as we discussed with Will Kennedy in Episode #158, has now become a global energy crisis. It is putting energy consumers into severe financial distress and forcing governments around the world to intervene in all sorts of unprecedented ways, as we discussed in Episode #181, “Command Capitalism.” For much of Europe, it will be a very tough winter. In this episode, Will returns to the show to explore the turmoil in energy and capital markets around the world, as well as how governments are responding to the crisis. We’ll also try to anticipate what will happen next. As we sketch out, this crisis will ultimately accelerate the energy transition because that is truly the only way out of this mess. But it won’t be a straight path, it won’t be quick, and it won’t be easy. This is a deep, dense, 90-minute-long conversation, so if you’re not a full subscriber yet, this would be a good time to join us! There are also more than 100 source references in the show notes for this episode, so be sure to log into our website using your subscriber credentials and check them out.

For our Seventh Anniversary show, energy researcher Jonathan Koomey rejoins us to review major stories over the past year, and to take stock of how the energy transition has progressed. We talk about how the global energy crunch we covered in 2021, in Episode #158, has evolved into a full-fledged global energy crisis in 2022. We reflect on the theme of Episode #181, “Command Capitalism,” and consider the increasing interventions governments are making in energy markets to manage the crisis. We muse on the episodes we did over the past year on the trajectory and speed of the energy transition. We consider the outlook for storage systems, in light of the episodes we did on that subject. We discuss how incumbents have resisted the energy transition, as we covered in our episode on utility corruption, and ask whether incumbents are gaining or losing ground. We review the highlights of our shows on the latest IPCC report and on climate modeling. And Jon shares some of his latest work in energy modeling. It's a smörgåsbord of energy transition goodness, so strap on a napkin and join us!

2022 has brought an unprecedented series of energy market interventions as leaders try to stave off domestic unrest in the face of numerous energy supply shocks. Some of the tumult we’ve seen in energy markets this year can be pinned on Russia’s invasion of Ukraine, and subsequent reactions by the West. But the war in Ukraine and associated sanctions really only exacerbated numerous fundamental trends that were already well established - trends that were positioning governments to take a stronger hand in their energy affairs. We are experiencing some very fundamental supply and demand problems in all sorts of energy fuels and other commodities around the world, and governments have little choice but to intervene wherever they can to maintain stability. Where is this all taking us? Can capitalism survive the energy transition? Or are we headed into a new era? Our guest in today’s episode has an answer: Kevin Book of ClearView Energy Partners believes we are seeing a new approach to economic management that he calls “command capitalism.” It may help us manage some of the challenges of the global energy crunch and the energy transition in a more direct way than we could through “free market” means… but it could also wrest control of our destinies away from regulators and energy ministries, with uncertain consequences.

Alberta is the seat of the Canadian oil & gas industry, as well as a major coal producer, so it has historically struggled to align with the energy transition - focusing more on pipelines than turbines. But Alberta is changing. Now, the province has implemented numerous policies designed to support the transition, installing a significant amount of wind and solar power generation capacity. According to the Alberta Electric System Operator, 14% of the province’s electricity generation in 2020 was from renewable energy sources such as wind, hydro and solar. In this episode, we are joined by energy expert Dr. Sara Hastings-Simon to discuss the challenges and opportunities for energy transition in Alberta. She is an Assistant Professor in the Department of Physics and Astronomy and School of Public Policy at the University of Calgary in Alberta, Canada, where she directs the Masters of Sustainable Energy Development program. She is an expert in energy, innovation, and climate policy, and her work is focused on understanding how energy and industrial transitions happen within different sectors of the economy, and how policy responses can improve outcomes. She is also the co-host of the Energy vs. Climate podcast, which will run this conversation on their podcast feed as well. We talk about the recent history of the various efforts to build pipelines and LNG facilities to export more Canadian oil and gas; the outlook for exports of hydropower; the progress of Canada’s coal phase-out; and the potential for expanding renewable generation in the province, including geothermal. Sara also shares her perspective on how Canada’s carbon tax regime has played out.

Although offshore wind has been booming for decades in Europe, it has gotten a slow start in the US. But that’s about to change. From a single 30 MW offshore wind farm today, offshore wind capacity in the US is expected to reach 1 GW in just two years, and grow by a factor of 40 over the next two decades to 30 GW under a new target set by the US Government. In today’s episode, we speak with Patrick Gilman, a Program Manager in the US Department of Energy's Wind Energy Technologies Office. For the past 14 years, Patrick has led a wide range of analysis, research and development, and deployment activities to help advance wind’s role in the US energy sector. We talk about the global state of the offshore wind sector; the technical and practical potentials for offshore wind in the US; how offshore wind can reduce the need for transmission capacity and balance out the production from land-based wind and solar farms; and how it can create good jobs and stimulate manufacturing. We’ll also look at some of wind's unique advantages over land-based resources, like easier paths to deploying transmission capacity. Wind might even be a good way to produce hydrogen we can use to decarbonize the hard-to-decarbonize sectors. Join us for this comprehensive look at the present and future of offshore wind in the US. It may be the most exciting sector in energy over the next two decades.

The energy transition is an extremely complex undertaking, with every country, company, and individual taking action in various, largely uncoordinated ways, and often in pursuit of different targets. This has led some observers to warn that the transition will be messy, and its outcome uncertain. But is that really a problem, or just another challenge to be met and overcome? In this episode, we speak with a researcher who has studied the history of technological innovations with a focus on the evolution of solar power. Dr. Gregory Nemet is a Professor at the University of Wisconsin where he teaches energy systems analysis, policy analysis, and international environmental policy. His research focuses on understanding the process of technological change and the ways in which public policy can affect it, and he offers some helpful insights on how the transition will unfold. He suggests that we needn’t just plunge blindly into the uncertain future and hope everything works out, nor should we hesitate to proceed until we are confident that we have a workable plan. Rather, he believes we can have quite a lot of confidence about how to proceed, without knowing exactly what all the steps are, and without knowing exactly where we’ll end up. In any case, simply staying along our current course is not an option. We discuss the general discourse about the energy transition, where it is confused about the fundamental nature of this transition, and how it will unfold. Whether you’re a full-throated transitionista or a skeptic, this episode is guaranteed to be thought-provoking.

Many people don’t know their local utility could be actively working against the energy transition and in opposition to public interests. In this episode, we review the manifold ways some utilities used customer money to distort public perceptions of the facts, and to lie about their own anti-social activities. We’ll explore stories of how corrupt utilities haved blocked progress on the energy transition, refused to reduce their own emissions, and made it difficult for consumer energy resources to participate on the power grid. These elements are illustrated through reviewing several notable cases of US utility sector corruption, and hearing how activists are asking the federal government to crack down on their abuses. We’ll also learn how the public and consumer advocates can help prevent such abuses.

Why do so many decarbonization scenarios rely on carbon capture and sequestration (CCS) to play a major role in the world's energy transition portfolio when it really doesn’t even exist as a commercial technology? Why does the IPCC's climate mitigation strategy model countries as if they would implement the same policy for carbon pricing across all sectors, when we know that’s just not how the world operates? Why do models dodge attempts to reflect the fragmented, irrational, and irregular way that the world actually works, when we know for a fact that the transition is going to be a bumpy ride into a hazy future? If globally coordinated carbon pricing never materializes, and CCS never has a real market opportunity as our integrated assessment models assume, where will that leave us in developing meaningful policies and taking action on climate change? And why aren’t other people asking this vital question? In this episode, Dr. Ida Sognnaes, a Senior Researcher at the CICERO Center for International Climate Research, explains how the integrated assessment models (IAMs) used in IPCC reports are constructed, what assumptions modelers make, and how the very design of IAMs can bias them toward certain outcomes—including the role of CCS as a climate mitigation strategy. She also offers further evidence that the world is currently on a trajectory for between 2 and 3 degrees of warming by the end of the century, and shares her perspective on why the climate modeling community has been so reluctant to just say that plainly.

Why do people take a NIMBY (Not In My Back Yard) attitude toward hosting energy transition solutions like wind, solar farms, and transmission lines in their communities? And what can be done about it? What do project developers and community planners need to understand about why a community accepts or rejects energy transition proposals? Are there specific methods that have proven effective in earning a community’s support, and are there common missteps that are guaranteed to derail a project? And what is the role of building and planning agencies in guiding the development of community projects? In this episode, Dr. Sarah Mills of the University of Michigan offers some answers to these questions. Not only has she researched these questions by talking to people in energy transition infrastructure host communities across the American Midwest and the Great Lakes regions, with a particular focus on rural communities, Dr. Mills also acts as the chair of her local planning commission, and tries to help local governments set policies around the development of clean energy by integrating it into their land-use planning, zoning, and other policymaking. Sarah Mills is a true expert in the field, and she offers important insights in this conversation that every renewable energy project advocate needs to hear.