Outline

• Overview: current status and future projections of renewable energy deployment

• Cost: Renewable energy is cheap (and becoming ever more cheaper)

• Risk: Renewable energy projects are modular (fewer risks of cost and schedule overrun)

• Virtuous cycle: learning curve + synergies with complementary flexible resources

Current status and future projections of renewable energy deployment

Current status

Future projections

Renewable energy is cheap (and becoming ever more cheaper)

Renewable energy projects are modular (fewer risks of cost and schedule overrun)

• Size of thermal power plants influences their conversion efficiency, resulting in large and centralized units

• In contrast, optimal size of a single wind turbine is much smaller, and for solar the size of a module has little effect on its conversion efficiency

• Modularity of solar and wind power plants reduces risks of cost and schedule overrun, and it also reduces risks resulted from cost and schedule overrun (e.g. emission reduction speed)

Empirical data on cost overrun risks

Note: Tail are projects with \(\geq\:50\%\) overruns. Data from Flyvbjerg database.

Carbon reduction risks comparison

Risk of carbon reduction speed of a large thermal power plant

Risk of carbon reduction speed of several RE projects

Learning curve + synergies with complementary flexible resources

• The more RE deployed, the cheaper they become (learning curve)

• The more RE deployed, the more cost-effective complementary flexible resources (batteries, EVs) become

• Those complementary flexible resources also have their own learning curves

• The result of all of the above is a virtuous cycle

Learning curve

Note that 2% of learning rate for nuclear might still be too optimistic based on historical data, as it has negative learning rate in the past.

Synergies with complementary flexible resources

RE, EV, and BESS grow hand in hand

VRE reduces storage volume requirement to replace the same amount of conventional capacity