Although the scope of the Blue/Green Alliance report is broader
than RMI’s, and assumes continued use of some fossil fuels, it provides
some useful insights on the need for investments in several key climate-friendly technologies, and the economic benefits they will produce. For
example, the section devoted to electrical generation, transmission,
and distribution estimates that the $354 billion invested in upgrading
the grid will be directly responsible for creating an additional 1.1M job
years of employment through 2027. This does not include the many
other businesses and institutions not directly involved with the shift to
renewable energy which will also benefit as the price of the electricity
they use to light, heat, cool, operate equipment, and transport their
goods becomes more stable, and even declines over time.
Conversely, the report warns that a failure to invest would result in
a less reliable power grid that delivers more expensive electricity and
continues to contribute to climate change. Even without factoring in
the additional damage done by extreme weather conditions, the report
calculated that a sclerotic, fossil-fueled electric grid would put a drag
on the economy that would lead to an $819 billion decrease in the U.S.
GDP and 102,000 fewer jobs by 2025.
A Third Way Beckons
If the RMI study’s findings prove to be correct, we no longer have to
choose between a healthy environment and a healthy economy. A third
way beckons us towards a more prosperous, sustainable future and the
engineers and entrepreneurs who lead the way will be the ones who
reap the biggest rewards.
Figure A. A graphic history of photovoltaic panel cost ($/W) and market demand.
Image courtesy of Solar Buzz and Green Economics Research.
Figure B. Solar prices as a function of cumulative photovoltaic panel shipments.
Image courtesy of RMI.
1. The Emissions Gap Report 2016: A UNEP Synthesis Report, United Nations Environment
Program, November 2016, http://wedocs.unep.org/bitstream/handle/20.500.11822/10016/
2. Abramczyk, Marshall, Martha Campbell, Aman Chitkara, Mia Diawara, Aileen Lerch, and James
Newcomb. Positive Disruption: Limiting Global Temperature Rise to Well Below 2 Cº. Rocky
Mountain Institute, 2017 https://www.rmi.org/insights/reports/positive_disruption_limiting_global_
3. The U.S. Solar Photovoltaic System Cost Benchmark: Q1 2017
4. Making the Grade 2.0: Investing in America’s Infrastructure to Create Quality Jobs and Protect
the Environment. The Blue/Green Alliance, 2017
Cumulative PV Module Shipments (MW)
10-1 100 101 102 103 104 105 106 107
10-1 100 101 102 103 104 105 106 107
HIS TORIC PRICE DATA
12 / 2016
For nearly 20 years, the cost of photovoltaic panels had declined
at a slow but steady rate as slowly rising demand made greater
economies of scale possible. Somewhere in early 2007, solar hit a
price point that triggered a surge in demand that in turn drove the
cost reduction curve sharply downward (Figure A). As a result, the
cost of solar panels plunged from over $2/Watt to around $1/Watt
in roughly a year, and eventually to $0.50/W or less (Figure B). In the
process, other PV system components (inverters, mounting brackets,
etc…) were driven to undergo similar price reductions. The trends
in PV system pricing documented in the recent National Renewable
Energy Laboratory (NREL) report3 provide an excellent example of
this process. During the year of 2016, NREL recorded nearly a 30%
reduction in the cost of electricity generated by utility-scale solar PV
systems, bringing it down to between 4. 4 and 6. 6 cents/k Wh. This
trend, and similar declines in the cost of wind- and biomass-generated
electricity, have already put renewable energy at or near cost parity
with conventional sources in many areas.