3 ms·
Here is a guess about why the original poster suggested that low oil prices may lead to greater renewable energy interest. The increased interest is not by the
by pdfernhout 6y ago
Here is a guess about why the original poster suggested that low oil prices may lead to greater renewable energy interest. The increased interest is not by the consumers of energy (you are right about lower oil prices meaning less immediate interest by consumers in alternatives) but by the producers of energy. If you have a billion dollars to invest in the energy sector, would you want to invest it in creating more oil wells and pipelines and refineries when there may be no return on that investment, or would you prefer to invest in producing or storing electricity or increasing energy efficiency where the return seems more predictable? Especially given the long-term trend of fossil fuels vs. renewables already shows renewables (especially solar) pulling ahead for new infrastructure..
Another factor is that fossil fuels in general have high external costs not paid for by the user (like for pollution, health, and defense). Some estimates suggest these extra costs for oil add more than $100 a barrel for oil for US defense of long oil supply lines to the Middle East and a bunch in respiratory health costs (and also acid rain) for coal. When you factor in these external costs, renewables and energy efficiency have been cheaper than fossil fuels since the 1970s (see Amory Lovins' writings for example). This true cost advantage of renewables is true even if fossil fuels are free of charge or even negative in cost. If someone pays you $30 to take a barrel of oil, there is still this extra $100 or whatever of externalities per barrel that society pays. That is even ignoring any cost of climate change.
The only reason this uneconomic situation persists is extensive lobbying by the fossil fuel industry for subsidies and exemptions, so that they can socialize costs and privatize gains. If the fossil fuel industry becomes weaker financially, then its lobbying efforts will presumably also weaken. Then there will be more effective public calls for the true price of fossil fuels to be paid up front. And that will level the playing field -- and on a level playing field, renewables and energy efficiency will win big.
This is tangential, but it has been estimated (perhaps controversially: http://evnut.com/gasoline_oil.htm http://evnut.com/gasoline_oil.htm ) that more energy from electricity and natural gas goes into refining oil into gasoline than the gasoline delivers to cars. Thus gasoline is mainly being used as an energy carrier. Liquid fuels are actually good at that -- but you don't need a liquid fuel to be a fossil fuel. Or even a agriculturally-derived fuel. In theory liquid fuels can be produced from the atmosphere. And in any case, battery technologies continue to improve, and electric cars in most cases (except maybe cold climates) are better experiences to drive than liquid-fuel-powered cars regardless of fuel cost savings. If fossil fuels become unprofitable to produce and distribute, what happens to the gasoline station infrastructure required for gasoline powered cars? That would put a new meaning to "range anxiety" when a car driver could plug in to recharge anywhere but gas stations were few and far between. What is going on now is just accelerating ongoing technical trends -- which is perhaps why Tesla stock is still flying high (even with the recent tweet by Musk on it being overpriced).