Research by Pembina Institute shows that when paired with battery storage and energy efficiency, electricity from solar and wind is capable of generating electricity with the same reliability and lower cost than gas plants.
Pembina says this is true, even in Alberta where natural gas is relatively inexpensive.
According to the research, clean energy portfolios — which include solar, wind, battery storage, energy efficiency and demand flexibility — provide the same services as new gas plants even in peak demand scenarios.
Pembina’s clean energy director, Binnu Jeyakumar says “It’s reliable, even when the sun isn’t shining and the wind isn’t blowing.”
The energy think-tank says the technology prices of wind, solar, battery and energy storage have fallen by 66 per cent, 86 per cent, and 73 per cent respectively since 2009-10. And data from 2017 suggest these clean energy power sources are already more economical to run than coal- or nuclear-power plants.
“This study proves Canadians don’t need to make financial sacrifices when choosing clean, renewable sources of electricity — the low-carbon option is cheaper for consumers, without subsidies, and delivers the same services as natural gas,” said Josha MacNab, national strategy director at Pembina Institute.
“This is a game changer,” added MacNab. “Clean energy portfolios are reliable, economically viable and technologically practical. And that will be good for our wallets as well as for human health and the health of the planet.”
Pembina says this economic analysis is especially critical at a time when governments are preparing to replace polluting coal plants, or to meet changing demands of the electricity system, and are choosing between high- and low-carbon options.
Jeyakumar said “Across Alberta, municipal leaders want to bring the benefits of renewable energy development to their communities.” She added “This study proves they are on the right path since the clean energy portfolios provide the same services at a lower cost for their constituents.
As part of its climate plan, Canada has committed to phasing out heavy-polluting coal power by 2030. Case studies from the United States have found that investing in clean energy portfolios rather than natural gas plants would save customers more than $29 billion per year, and cut carbon emissions by 100 million tons.
“Along with providing affordable electricity to Albertans, clean energy portfolios offer employment and economic development opportunities that should be paired with training and support programs so Albertans have careers in the rapidly expanding global clean energy industry,” said Duncan Kenyon, Alberta director, Pembina Institute.
“This economic analysis shows how Alberta can diversify its energy supply and be better positioned to profit from the 21st century decarbonized economy.”
The study was conducted in Alberta, which has comparatively low natural-gas costs, and offers strong support to the oil and gas industry. Researchers also took into consideration Alberta’s abundant renewable energy resources.
The analysis, which uses modelling provided by the Rocky Mountain Institute, shows that when the lifetime output from portfolios of renewable energy is compared against the energy generated at gas plants, the renewable energy will cost $9 to $24 less per megawatt hour than energy from gas plants that generate power on a steady basis and those producing it at peak hours.
Much of the savings are due to the dramatic decline in the costs of wind, solar, and storage in recent years. And Pembina says the cost of renewables and storage is expected to continue to drop while the technology improves even further.
Pembina compared the costs of renewable energy with gas plants in just one province, but the positive results show the need to conduct further analysis in Saskatchewan, New Brunswick and Nova Scotia. All of those provinces, like Alberta, will be considering new energy options as coal plants are phased out over the next decade.
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