UNSW busts myth on energy returns, says renewables will boost economy

The federal Coalition’s interminable political scare campaign over the economic cost of shifting to renewable energy – one of the key planks of the Morrison government’s election campaign last year – has been debunked once again, this time by a University of New South Wales study.

The UNSW research, published in the international journal Ecological Economics, re-confirms that the transition to an energy future dominated by large-scale solar and wind energy will deliver environmental and long-term economic benefits, and are rapidly outdoing fossil fuels and nuclear on almost every metric.

More specifically, it disproves the theory – often espoused by renewable detractors – that a transition to large-scale renewable energy technologies and systems will damage the macro-economy by consuming too much global energy generation.

This theory, a favourite of the global nuclear lobby, is based on the idea of Energy Return on (energy) Investment (EROI) – a metric applied to power generation, measuring relative inputs and outputs.

The extremities of this argument hold that wind and solar never pay back the amount of energy needed to build the turbines or panels.

It’s bunkum of course, but a favourite of the nuclear lobby in particular, of fossil fuel promoters in general, and an excuse for the Morrison government’s to favour traditional energy sources and to wonder where the technologies of the future would come from, and to fret about the future of the economy.

Honorary Associate Professor Mark Diesendorf, who led the research in collaboration with Prof Tommy Wiedmann of UNSW Engineering, says  that the theory is not supported by real-world evidence, and instead relies on “ridiculous” outdated figures for both solar and wind technology.

“These critics claim the world’s economy would suffer because they argue renewables require too much lifecycle energy to build, to the point of diverting all that energy away from other uses,” he said on Wednesday.

“Our paper shows that there is no credible scientific evidence to support such claims, many of which are founded upon a study published in 2014 that used data up to 30 years old.”

That means the calculations used by proponents of nuclear fail to factor in the massive cost reductions for solar and wind generation: about 30 per cent for wind and 85-90 per cent for solar in the past decade alone.

Further to outdated data, Diesendorf says the EROI theory also fails to consider the energy efficiency advantages of shifting away from fuel generation and overestimates energy storage requirements.

“We found that the EROIs of wind and solar technologies are generally high and increasing; typically, solar at a good site could generate the lifecycle primary energy required to build itself in one to two years of operation, while large-scale wind does it in three to six months,” he said.

“The impact of storage on EROI depends on the quantities and types of storage adopted and their operational strategies. In the regions we considered, the quantity of storage required to maintain generation reliability is relatively small.

“We also discovered that taking into account the low energy conversion efficiency of fossil-fuelled electricity greatly increases the relative EROIs of wind and solar,” Diesendorf added.

“Finally, we found the macro-economic impact of a rapid transition to renewable electricity would at worst be temporary and would be unlikely to be major.”

The UNSW team is not the first to take apart the nuclear lobby’s EROI argument. As Michael Mazengarb reported at around this time last year, a study by researchers at the Sustainability Research Institute at the University of Leeds pointed to improving manufacturing processes for solar panels and wind turbines, as compared to increasingly difficult access to fossil fuel resources.

The study, which also examined EROI across a range of resources, found that as access to coal, gas, and oil became more difficult, it would require more work, and consume more energy to extract.

“We find it credible that declining EROI ratios of fossil fuels will lead to constraints on the energy available to society in the not-so-distant future, and that these constraints might unfold in rapid and unexpected ways,” the paper said.

For the UNSW team, the hope is that the findings of the Clean Energy Australia report will give renewed confidence to businesses and governments considering or already making a transition to more sustainable electricity technologies and systems.

Diesendorf’s further hope is that the findings will also catch the eye of the Morrison government.

“In Australia, the transition is happening because renewable energy is much cheaper than fossil fuels, but there are many roadblocks and potholes in the way,” he said.

“For example, wind and solar farms have inadequate transmission lines to feed power into cities and major industries, and we need more support for storage to better balance the variability of wind and solar.

“So, I hope our research will help bolster support to continuing with the transition because we have discredited the claim that the EROIs of electricity renewables are so low that a transition could displace investment in other sectors.”