You’ve heard of the blue wave and the red wave, but while the political landscape is constantly changing, the shifting energy trends are all culminating in one powerful force: the green tidal wave of renewable energy.
Since the last quarter of 2018, everyone’s ears have been perked up to all things eco-friendly. When the U.S. Global Change Research Program, the Intergovernmental Panel on Climate Change, and the U.S. Geological Survey all say that the planet is in peril if we don’t change our energy consumption, the world takes notices. Similarly, everyone is always interested in saving a little green ($$$)!
Thankfully, we’re close to having the infrastructure and tools in place to be able to maximize the potential of renewable energy and ride the green tidal wave to a healthier ecosystem and bank balance.
These are six of the most promising energy trends you should be watching in 2019.
1. Storage
Solar power is an incredibly valuable resource. The men and women working to develop this technology have come leaps and bounds in recent years. However, one major problem still exists: the sun doesn’t hang out in the sky 24 hours a day.
Therefore, solar power is perpetually an unpredictable and fluctuating resource. However, thanks to recent and continued advancements in solar storage options, we’re getting closer and closer to solving this intermittency issue and bringing costs way down.
This year, we can expect to see incredible improvements in the reliability and longevity of solar power storage solutions that will make going solar a far more viable option for all.
2. DER & Microgrids
Distributed Energy Resources (DER) is a combination of distributed energy generation networks and energy storage systems. DER systems are often placed strategically throughout an energy distribution network. These systems may include solar power systems, fuel cells, microturbines, or even combustion engines.
Microgrids are similar but have the added benefit of being able to operate independently of the main grid. Not only do DER and microgrids allow facilities, local communities, and even larger regional areas to operate autonomously, but also they provide relief to the larger energy grid, which reduces congestion and other systematic problems.
Of all the energy trends, DER and microgrid systems have the potential to make a dramatic impact on the health of our energy infrastructure and planet because they can be implemented privately, giving the power to change the course of our environment to the people most impacted by it.
3. Declining Cost of Solar Energy
Thanks to the increasing popularity of renewable energy and the incredible advancements in technology, we’re seeing a dramatic drop in the cost of going solar. In fact, “the cost to install solar has dropped by more than 70% since 2010, leading the industry to expand into new markets and deploy thousands of systems nationwide,” says the Solar Energy Industries Association (SEIA). This is one of our favorite energy trends since the immediate cost of going solar often deters would-be-good-doers from making the switch to renewable energy.
Around the country, we’re seeing a rise in grid parity – which occurs when the cost of renewable energy equals or dips below that of traditional electricity.
In some areas, the price per kilowatt-hour has gone down to as low as $0.02 for wind and $0.028 – $0.045 for solar, as of Q3 2018 according to reports from SEIA. We can expect to see this price continue to come down throughout 2019 and beyond.
4. Taxes & Tariffs
The Federal Investment Tax Credit (ITC) is a solar tax credit that allows an entity to deduct 30% of the installation cost of its solar power system on annual federal taxes. However, this tax credit is scheduled to step down on an annual basis to 10% for the calendar year 2022.
On the flip side, we have to deal with fluctuating tariffs on things like crystalline-silicon solar cells, modules, imported steel, aluminum, and inverters necessary to build solar power systems.
There’s a direct correlation between the application of new tariffs and the price of solar elements. For example, the price of solar panels (also known as modules) was on a steady decline until the Section 201 Solar Tariff case appeared in 2017. Until the final decision was made on whether or not to enact the tariff, the price of modules gradually increased.
In February 2018, the tariff was imposed and added a 30% tax on imports. While the market took a hit initially, the prices have started to come back down again as the market builds confidence in the fact that the U.S. will continue to push toward renewable energy sources despite fluctuating circumstances surrounding trade with China.
As the policies surrounding renewable energy ebb and flow, it’s critical to understand the ever-changing landscape in order to find the most opportunistic time to act.
5. State Level Push to Go Green
On the state level, many such as Texas, New York, and California are adopting greener policies. States are enacting legislation that implements various green policies such as requiring a certain percentage of the state’s energy to come from renewable energy sources to those geared towards increasing efficiency. These requirements will increase gradually over time to ensure the state continues to move in the direction of the green wave.
In Texas, Senate Bill 898 now requires each political subdivision, institution of higher education, or state agency to reduce electrical consumption by at least five percent each fiscal year for ten years beginning September 1, 2011.
Over in New York, the New York Independent Service Operator (NYISO) is working to reduce carbon emissions. A new proposal recommends legislation that will raise the cost of energy for carbon-emitting resources, which encourages the development of cleaner generation.
6. Corporate Eco-Consciousness
For the past several years, we’ve seen companies such as Coca Cola, Marriott, and Target take a stance on social issues. However, with the booming interest in all things earth-friendly, many corporations are now making their opinions heard as they relate to the environment.
Several companies, including Budweiser, Apple, and Google, are committing to running their companies completely on renewable energy. These economic leaders are now becoming eco-friendly leaders and are setting an example of how even the largest operation can be converted to green, clean energy.
This new trend is already gaining massive attention and traction. In fact, it’s been aptly named the “RE100” campaign, which stands for the goal of achieving a 100% renewable energy model by a set date. More than 160 companies around the world are evaluating their operations, creating concrete plans, and committing to a deadline for sourcing 100% of their power from renewable sources.
The Sweet Spot of Energy Trends
When it comes to maximizing the potential of key trends, it’s all about finding the sweet spot. That spot is the intersection of improved quality and technological advancements + decreased cost of adopting the trend.
For example, for the past 20 years, most solar energy providers have been too expensive to make good business sense for buyers. However, as the technology has improved and the cost of design, engineering, and development has come down, we’re seeing that sweet spot emerge.
If you’re interested in riding the green wave while saving money for your business and helping protect the planet’s future, consult with a trusted energy advisor and ask about where the sweet spot is for your business.
