Economics of Renewable Energy: Science, Economics, and Governance

1. HONR 229L: Climate Change: Science, Economics, and Governance Economics of Renewable Energy Your name here 31 October 2016

2. As always, I suggest possibly working the admission ticket questions into the presentation. But you have plenty to choose from, since the reading ends with a nice set of discussion questions. If you decide to use the admission ticket questions, for this lecture, best to work into the start (to draw the class into the discussion, since most students will have thought of these questions just before class) but as we discussed, great if you can move beyond the AT questions on Monday. Here is Q1: The reading states the three cost challenges for producing more energy from renewable sources are net energy, overcoming intermittency, and capital intensity. Table 3 provides net energy ratios from various energy sources. Based on your prior knowledge and/or material covered in this class: a) what aspect of Table 3 do you find to be least surprising least surprising? b) what aspect of Table 3 do you find to be most surprising? Note: I think there is a clear “surprise” in the table … i.e., something I absolutely did not expect to see. So I decided to do my own research. This is the paper cited for “farmed willow chips”: http://www.tandfonline.com/doi/full/10.1080/07352680500316334 (only need to read the abstract). See some differences, with respect to the “manna from heaven” treatment in the reading ?!?

3. Here is Table 3 as an easy to re-size PNG I always try to “double source” info but in this case, as far as I can tell, the single source for farmed willow chips seems to be off. Can also, should you so desire, pull info from http://onlinelibrary.wiley.com/doi/10.1111/gcbb.12111/full (will need to be on campus to access this article, and one on prior slide)

4. Here is Figure 5 from this paper: http://onlinelibrary.wiley.com/doi/10.1111/gcbb.12111/full Please note totally your call whether to use !!! Reason to use would be to motivate students to check sources of info.

5. Here is Q2: Table 4 provides an estimate of the cost of providing electricity from various sources. The authors have decided to use capacity factor in an interesting mathematical manner, for the rank ordering of "capital cost to produce the same amount of electricity as one kW of capacity running continuously" given in Table 4. Briefly, how has capacity factor been used and do you feel the use in this manner is appropriate? Feel free to communicate with me about your take on the answer to this question

6. And Table 4 as an easy to re-size PNG Here is the table, as given in the book

7. And Table 4 as an easy to re-size PNG Here is the table, with an interesting mathematical operation that I have applied ! You’re welcome to use.

8. And Table 4 as an easy to re-size PNG And here is the same table, prior page, with the sources ordered based on last column. Can have plenty of discussion about this table, including: • statement on page 8 of the PDF file (this was assigned as auxiliary reading for Mon) that the US and China have just developed 16% and 24%, respectively, of their “technical potential” for hydro • Need to address intermittency, which is the only way this “re-multiplication” and “re-ordering” would be feasible • Factor of 3 increase in cost for offshore wind relative to onshore wind … prob due to harsh marine envir • Huge challenge faced by the low capital cost of gas … which is driven in part by the huge “discount” applied to future purchase of gas explained just about the table.

9. And Table 4 as an easy to re-size PNG And here is the same table, prior page, with the sources ordered based on last column. Can have plenty of discussion about this table, including: • Also, strange that geothermal electricity does not appear in the table. Could ask students to speculate why. I have my own idea … wonder what you and the students think ?!? 

10. Speaking of intermittency … the reading refers to the Northfield Mountain pumped storage station I placed this URL into the Auxiliary Reading section: http://www.masslive.com/news/index.ssf/2012/09/northfield_power_facility_look.html You could prepare a slide or two, summarizing this station (since it is in the reading) or water else you can easily find about pumped water energy storage solutions

11. Here is Q3: The reading emphasizes the potential for energy efficiency to play an increasingly important role, in the transition of society towards reducing the emission of greenhouse gases. In a few sentences, describe what is stated about energy efficiency and also express an opinion as to whether or not you believe the statement: energy efficiency is the “alternative energy source” with the “greatest potential” (for societal benefit) is correct. There is no correct answer here. IMHO, often the fossil fuel folks use this as a “cop out” but, on the other hand, the state of Md does provide financial benefit to homeowners who decide to conduct a home energy audit and improve the air tightness of their homes: http://energy.maryland.gov/pages/facts/empower.aspx Should you so desire, you could provide a brief focus on this question, that will hopefully elicit a range of opinions . Again, no right answer. Interesting to see if anyone’s family has done a home energy audit, if students know about the above program, etc.

12. Here is one of the essay choices for Q4: The reading emphasizes rather strongly that “directing the bulk of energy subsidies toward fossil fuels tilts the playing field in their favor” and provides numerical estimates for the subsidies directed towards the fossil fuel industry. a) State the dollar amounts given in the reading, for the subsidies directed towards fossil fuels b) The reading provides no detail as to what these subsidies entail. Pick a fossil fuel sector (i.e., electricity, transportation, heating fuel, etc) and, based on your own quick research, succinctly provide the missing detail. c) explain the conundrum that the dollar amount of subsidies directed towards the fossil fuel industry is so large, while at the same time the cent per kilowatt-hour benefit enjoyed by the fossil fuel industry is so much less than the same benefit provided to the renewable energy industry I am keenly interested in what folks come up for, in response to b). I’m sure I will learn if you ask students who answered to state what they found. If you are having any trouble with c), let’s chat 

13. Here is the other essay choice for Q4: The phrase internalizing externalities seems like an oxymoron. Yet this might be the best hope for avoiding catastrophic climate change due to societal dependence on fossil fuels. Provide a brief essay explaining this phrase and either support, or refute, the view that internalizing externalities is indeed is our best hope for avoiding catastrophic climate change. Try to work the phrase Pigovian taxes into your reply. Can spend plenty of time on this, should you so desire. OR … you can spend a little time one this and segue into one or more of the Discussion Questions given on page 42 of the reading Please note this website: http://www.ase.tufts.edu/gdae/education_materials/modules/RenewableEnergy.ppt contains all of the figures in the reading … can use as many as you’d like One item kind of left on the “cutting room floor” was Figure 5 and the “equimarginal principle”. Perfectly fine if you’d like to use Figure 5 and spend time having students explain in there words what this means … or perfectly fine to not use. Your call!