25 Percent Renewable Energy by 2025 Possible for USA

WASHINGTON, DC, November 13, 2006 (ENS) - Renewable resources could produce 25 percent of the electricity and motor vehicle fuels used in the United States by 2025 at little or no additional cost, finds a RAND Corporation study issued today. Renewable sources currently provide about six percent of all U.S. energy supplies.

Using a computer model, RAND researchers assessed the possible impact that a 25 percent renewable energy target for electricity and motor vehicle ground transportation could have on total national energy expenditures and on emissions of local air pollutants and carbon dioxide by the year 2025.

They found that if renewable energy production costs decline by at least 20 percent between now and 2025, which is consistent with recent experience, the 25 percent figure can be reached unless long-term oil prices fall far below the range currently projected by the federal Energy Information Administration, EIA.

RAND conducted the study at the request of the Energy Future Coalition, a nonpartisan public policy organization in Washington, DC.

Stirling system solar power concentrator at the Southern California Edison Solar One test site (Photo courtesy Sandia)

The Coalition says the 25x'25 vision is one of many recent calls for the United States to expand its reliance on renewable energy.

In his 2006 State of the Union address, President George W. Bush stated goals for increasing the use of biomass fuels in transportation and curbing oil imports. Without waiting for federal action, 20 states and the District of Columbia, meanwhile, have set targets for increasing the use of renewable electricity technologies with renewable energy portfolios that require a percentage of a state's power to be generated by renewables.

Significant reductions in carbon dioxide emissions from fossil fuel combustion also can be achieved by meeting the 25x'25 goal, the study found – amounting to one billion tons of carbon dioxide in 2025, or 15 percent of projected U.S. emissions.

In addition, an estimated 2.5 million barrels of oil consumption would be displaced by renewables, according to the study.

1.5 megawatt wind turbine at the Tennessee Valley Infrastructure Group windfarm, Kimball, Nebraska (Photo courtesy TVIG)

The authors, RAND researchers Mark Bernstein, Jay Griffin, and Robert Lempert, estimate that about 18 percent of total U.S. energy demand in 2025 could be met by renewable sources of energy.

They find that as renewable energy supplants nonrenewable energy, demand for fuels declines, driving down the prices of fossil fuels in the computer model.

"When talking about the impact of increasing use of renewable energy sources in our energy future, it's important to be clear about the assumptions being made about future energy prices and technological developments, not just for renewables but also for competing fossil energy sources," said Michael Toman, director of RAND's Environment, Energy, and Economic Development program.

The RAND study examined 1,500 cases of varying energy price and technology cost conditions for renewable and nonrenewable resources. The RAND team developed a model based on the EIA's National Energy Modeling System.

The most extreme of the 1,500 scenarios produced no more than a six percent change in energy expenditures, or about $75 billion in additional costs in 2025.

This includes the most favorable scenario for nonrenewable energy simulated - in which the costs of renewable energy technology rise 30 percent during the next 20 years, while natural gas, oil, and coal prices fell 50 percent from current projections.

"It is interesting to note," the authors wrote, "that in our computer runs of the renewables goal, more scenarios have lower energy expenditures in 2015 than in 2025. Those ?ndings suggest that, while cost savings from renewable energy will not materialize overnight, they also will not take decades to achieve."

They explain the rising price of renewables after 2015 as due to the fact that, as the penetration of renewable energy rises from 10 percent of the market in 2015 to 25 percent in 2025, the most favorable renewable sites will already be taken; "therefore, costs rise as we increase the share of renewables, even while costs per unit fall due to technical advances."

The study did not model some possible emerging technologies, such as renewable forms of hydrogen.

In his 2003 State of the Union address, President Bush set a goal of having hydrogen motor vehicles for sale in car dealers’ showrooms by 2025. But since most estimates show only minimal market penetration of hydrogen by 2025 and the National Energy Modeling System does not yet include it, the researchers chose not to attempt to model it.

RAND researchers did not assess the impact of renewable energy used directly by industry in buildings currently using natural gas, in off-road vehicles used for construction and recreation, or in railroad and jet fuel.