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High renewable energy start up costs, later fall, because sun and wind are free

converting to a lower-carbon economy would increase electricity prices until around 2030, because renewable energy technology requires high start-up costs. They would fall after that, because fuel sources such as sun and wind are free.

Renewables need not cost more: EU energy chief By Barbara Lewis, BRUSSELS Dec 15, 2011  (Reuters) – A shift to renewable energy would ultimately cost around the same as business as usual and the EU needs to make progress on setting a 2030 target for greener fuel soon, the bloc’s energy commissioner said.

Guenther Oettinger was laying out the European Union’s latest road map for mostly eliminating carbon from the fuel mix by 2050 and guiding investors beyond the Commission’s existing set of energy goals.

Green politicians and environmental groups welcome the new focus on
cleaner energy, but want quicker progress away from fossil fuel and
nuclear power, especially after Japan’s nuclear disaster earlier this
year.

“It’s more or less the same if we go for business as usual or for more
ambitious scenarios which involve a lot of renewables,” Oettinger told
a news conference on Thursday. A leaked draft last week already showed
that converting to a lower-carbon economy would increase electricity
prices until around 2030, because renewable energy technology requires
high start-up costs. They would fall after that, because fuel sources
such as sun and wind are free.

Early investment decisions to replace ageing infrastructure with more
intelligent, joined-up networks across the European Union can also
limit costs. “It’s sensible to invest now,” Oettinger said.

For every U.S. dollar of investment not made in the power sector
before 2020, an extra $4.3 would need to be spent afterwards to
compensate for increased emissions, according to figures from the
Paris-based International Energy Agency, which the Commission quoted.

Investors need interim targets for guidance, beginning with figures
and followed by binding targets.

“If we’re going to end up with zero by 2050, then we must have a
realistic interim (renewables) target by 2030,” Oettinger said.

“It may be that in two years’ time, we have to lay down figures for
this, or it may be that we lay down conditions, for example CCS
(carbon capture and storage).

“In 2014, we want to establish what must be achieved by 2030.”

BEYOND 2020

So far, a set of 2020 targets are a major plank of the EU’s energy
policy, which is aimed at ensuring sustainable, secure and competitive
supplies, with reduced dependence on imports from energy giants such
as Russia….. “The Commission will be tempted to overplay the role of
coal and nuclear energy to appease the likes of Poland and France, but
the numbers in the road map are unequivocal,” Greenpeace EU Energy
Policy Director Frauke Thies said.

“It proves that a modern energy system can’t do without renewables and
efficiency but can easily consign coal and nuclear power to the
past.”….. http://www.reuters.com/article/2011/12/15/us-eu-energy-roadmap-idUSTRE7BE19T20111215

December 16, 2011 - Posted by Christina Macpherson | EUROPE, renewable