How do renewable energies become more cost competitive and provide a bigger share of the world's energy mix?

Renewable energy is energy derived from regenerative sources. For more than three decades, the world's renewable energy production has increased and currently makes up a little more than 13 percent of the world's energy supply¹. Some say that isn't enough, that government and business should do more to increase renewable energy production.

Yet, as energy companies, governments and the investment community continue to invest in and develop renewable energy sources, they are learning more about the challenges in bringing these sources to market.

It is no simple task to generate reliable energy cost effectively and with little or no impact to the environment. Consider the following points:

Emerging Renewable Energies - a Snapshot

There is a lot of enthusiasm and curiosity around the various forms of renewable energy discussed by media and politicians in recent years. Some of these energy sources are already in operation, others are experiencing rapid development and refinement, while still others are merely ideas.

Below is the overview of progress on some key renewable and alternative energy sources²

ENERGY SOURCE	STAGE OF DEVELOPMENT	25 YEAR OUTLOOK
Wind	Refinement	Positive
Solar	Refinement	Positive
Tidal and Wave	Further Research/Trial	Neutral
Hydrogen	Further Research/Trial	Neutral
Biofuels/Crop Based	Refinement	Neutral
Biofuels/Cellulosic	Further Research/Trial	Neutral

Expediting the Potential - Some Barriers To Speed

Science
The scientific and technical challenges of making some renewable energy sources practical are enormous. Developing new energy sources on a mass scale requires research, development, evaluation and refinement, all of which take time and money. And, what works at small scale in the laboratory may not work at all in a large-scale, commercial setting.

Infrastructure
Once the science of producing renewable energy is mastered, producers must deliver it to consumers safely, reliably and cost-effectively. This requires a large, expensive infrastructure. Some energy sources may be able to use transportation and delivery systems for existing energy sources, while others may require entirely new means of production and delivery.

Cost Considerations
While energy from renewable sources has been generally more expensive than energy produced from conventional sources, the gap continues to narrow for specific alternatives.³ For some technologies, scientific investment and infrastructure costs remain substantial, while for others reliability continues to be the primary commercial and technical challenge. As a general matter, adopting renewable energy sources on a large scale presents both considerable challenges and the potential for significant benefits.

Changing Our Views

Innovation, collaboration and conservation can serve as the cornerstones to developing future energy solutions. To encourage accelerated development, we should consider the roles each of us can play. Everyone has a contribution to make - from governments, to businesses, to educators, to environmentalists, to individual citizens. What role can each of these play in developing and employing alternative energy solutions? How can we work together to bring these renewables to market?

1. Source: IEA Energy Statistics,
   http://www.iea.org/textbase/papers/2002/renewable.pdf(PDF, 194KB)
2. Source:
   The 25 Year Outlook reflects an overall conclusion based on these combined criteria from the EIA ANNUAL ENERGY OUTLOOK 2007:
   
   • Large Scale Potential (Resource Availability and Viability of Delivery);
   • Relatively Advanced Development Stage;
   • Economic Potential
   http://www.eia.doe.gov/oiaf/aeo/index.html
3. Appendix, World Resources Institute, U.S. Senate Environment and Public Works Committee Climate Roundtable Testimony: Exploring Greenhouse Gas Technologies, May 2006
   http://pdf.wri.org/pershing_ewf_testimony.pdf (PDF, 348KB)