Renewable energy is synonymous with efficiency. Generating electricity with fossil fuels involves using labor and machines to dig up substances like coal or natural gas, which took eons to form; once burned, they can’t be replaced. But harness the wind that blows one night to turn wind turbines, and a similar amount of wind will probably blow the next day. The same sun that hits solar panels today will rise and perform the same magic tomorrow: You don’t have to mine the wind or transport the sun. Using fossil fuels to create electricity creates byproducts that have to be managed afterward, like emissions and coal ash. With renewables, there are no emissions or toxic byproducts.
And yet, given the way the U.S. has gone about adding renewables to the grid, there actually is a fair amount of inefficiency and wasted energy. On any given day, a certain amount of wind and solar power is curtailed, as the term of art goes. Wind turbines, for example, get turned off even though the blades are still turning; the production of solar plants sometimes gets dialed down. In early July in California, for about an hour one afternoon, some 292 megawatts of solar capacity was curtailed—enough to power thousands of homes.
Why do we have curtailment? Blame the herky-jerky way we roll out new technologies and build infrastructure in this country.
Inefficiencies in new economic infrastructure aren’t exactly new. Because the state doesn’t centrally plan and roll out new technologies in a completely rational fashion—matching demand, distribution, and supply—wrinkles and bubbles develop. Incentives may be available for one component of the technology but not for others. And so overinvestment in one stage of the process coincides with underinvestment in another stage. Which is why we have bubbles. The earliest telegraph lines from Boston to New York City stopped at the Hudson River—and messages had to be carried across the Hudson on a boat. In the 1990s, information would travel at rapid speeds across the country on fast cables but slow down in the last mile. (I wrote a book about this in 2007.)
The same has happened with wind and solar. There are significant government incentives to build wind and solar farms in the plains and deserts, where land is cheap and resources are plentiful. The U.S. renewable industries have figured out how to build and finance wind and solar farms at scale. But the transmission and the distribution systems, which don’t benefit from the same incentives, haven’t kept up. Transporting electricity involves stringing high-voltage lines across hundreds of miles of open space, across property owned by thousands of owners and multiple state lines. You can put up a giant solar farm or a wind farm in a matter of months. But as the travails of transmission-builder Clean Line Energy show, building the lines that will carry electrons from the places where they are created to the places they can be used can take decades.
The design of the grid also works against efficiency. Texas maintains an electricity grid that is not connected to its neighboring states. And so when the huge wind farms built in the state generate power at times when demand is low, strange things can happen—like negative prices for their energy output. And even states in which grids are interconnected, there’s often a mismatch between demand and the amount of power generated during periods of peak usage in the late afternoon, leading to price spikes.
And, of course, the very nature of renewables also works against efficiency. Plants powered by coal and natural gas can guarantee steady production over the course of the day, and dial output up and down with great precision as demand changes. But wind and solar are famously intermittent sources, so the task is harder. With solar, clouds and weather patterns can affect the intensity of solar radiation. The ability of solar panels to produce electricity varies dramatically over the course of the day. Winds can gust and die down in ways that defy easy prediction. So in the middle of the day, when solar panels are producing the maximum output and demand tends to be low, there may not be users for all the electricity being produced. And at night, when the wind blows powerfully and the world is asleep, there may not be takers for the power at any price.
That’s when you get curtailment, or energy waste. Curtailment is most pronounced and frequent in energy islands: geographical islands like Hawaii and electricity islands like Texas. Generally speaking, wind power is the most likely to be curtailed. In 2009, some 17 percent of the wind generation in Texas was curtailed. But as the state built new transmission lines to connect the wind farms to population centers, the rate has declined. As this exhaustive report from the Energy Department notes: Only 0.5 percent of all wind generation within the coverage area of the Electric Reliability Council of Texas was curtailed in 2014, down from the peak of 17 percent in 2009. (Here’s a chart of curtailments in Texas between 2011 and 2014.)
The output of giant solar farms may also be curtailed. As David Baker reported in the San Francisco Chronicle, “the challenge, paradoxically, is that California has added solar plants so quickly that the grid doesn’t always have room for all of the electricity.” Which is why on sunny summer days the state may idle solar plants with the combined capacity of a decent-sized coal plant for an hour or more.
Over time, markets tend to sort out inefficiencies. But the power markets in the U.S.—which are regulated, influenced, and distorted by incentives and mandates—aren’t perfectly efficient markets. And the solution to curtailment requires investments and technologies that aren’t quite as developed as the generation technologies. A more robust and far-reaching set of transmission lines would ensure that electricity generated by wind and solar could reach customers more frequently. Regulators have to think about the shape of the national grid and the interconnections between different components. But the real solution may be investments in what is now one of the electricity industry’s hottest growth markets: storage. If you can’t use the electricity where and when it’s generated, and if you can’t move it to where it is needed, the most efficient thing to do would be to set it aside for use later in the day.