As we repeatedly pointed out in early 2020, during the debate over the Virginia Clean Economy Act (VCEA), the legislation is far from perfect, but instead represents just a *start* – better than nothing, but not even close to being adequate – to the process of transitioning Virginia from a fossil-fuel-heavy, costly and environmentally destructive energy economy. The key, of course, was taking VCEA not as a “ceiling” but as a “floor” upon which we could build in future legislative sessions. This past session, there was *some* progress on the energy front, particularly in the area of Clean Car Standards, but nothing particularly in terms of building upon VCEA, per se.
One of the biggest problems with VCEA – as I pointed out to one of the leaders on this bill at the time, only to be told that I wasn’t being “realistic” or some bullshit – is its baffling lack of ambition, given plummeting costs for clean energy and the urgency of combatting the climate crisis (emphasis on the word *crisis*). Currently, for instance, VCEA requires “Dominion Energy Virginia to be 100 percent carbon-free by 2045 and Appalachian Power to be 100 percent carbon-free by 2050.” Wait, what??? This is going to take until 2045 and 2050? As in, 24 years and 29 years from now?!? To put it mildly, that seems like an awfully long time – FAR too long! – given the urgency of the climate crisis and the economics of clean energy vs. fossil fuels. So how much more ambitious should/could VCEA be? A fascinating new analysis by independent think tank “RethinkX” finds that, in fact:
- “[G]overnments can and should recalibrate their emissions targets and bring forward their policy and planning timelines for achieving 100% clean energy into the 2030s from the 2050s and 2040s (which are based on flawed [Levelized Cost of Electricity] LCOE estimates).” (That’s right, the 2030s — or 10-20 years earlier than what VCEA unambitiously requires!).
- “Carbon neutrality can be achieved more quickly and cheaply than generally expected” and that “The disruption of the electric power sector by solar, wind, and batteries (SWB) during the 2020s will unfold much more rapidly than mainstream forecasts expect”
As you’ll see in the report (see below for highlights), getting to a clean energy economy by the 2030s is already the no-brainer choice from a purely economic and technological perspective, let alone from a climate perspective. So why on earth aren’t we doing that here in Virginia?!?
- “Coal, gas, nuclear, and hydro power are no longer competitive with the combination of [solar, wind, batteries] SWB, even using inaccurate mainstream [levelized cost of electricity] LCOE calculations.” (Exactly, so why the hell is VCEA talking about 2045 and 2050, when solar/wind/batteries already outcompete fossil fuels TODAY?!?)
- “Capacity factor of conventional coal, gas, nuclear, and hydro power plants will not remain high or constant, but will instead decline dramatically over the next 10 to 15 years as they are outcompeted and disrupted by the combination of solar photovoltaics, onshore wind, and lithium-ion batteries (SWB). In fact, capacity factor in conventional energy has been dropping since at least 2010.” (The crystal-clear conclusion is that we shouldn’t be building any more conventional coal, gas, nuclear or hydro power plants, but instead should be going to 100% solar PV, onshore wind – and, increasingly, offshore wind, given its plummeting costs, and batteries).
- “By 2030, the corrected LCOE of a new gas power plant is nearly 5 times greater than the U.S. EIA Reference Case assumption, at 18.4 cents per kilowatt-hour.” (Again, the obvious conclusion being, DO NOT build any more natural gas power plants!)
- “When we retroactively recalculate LCOE accounting for a dynamic rather than static capacity factor, we find that solar PV reached cost parity in 2013 rather than 2016 for coal, in 2018 rather than 2020 for gas, in 2014 rather than 2016 for nuclear, and 2015 rather than 2020 for hydro power. Moreover, the cost gap between SWB and conventional power plants is widening much more rapidly than mainstream analysts are projecting. By the 2030s, the LCOE of a newly-built solar PV will be less than 1/20th that of any newly-built coal, gas, nuclear, or hydro power plant because these conventional plants will – at best – have a capacity factor and utilization profile comparable to today’s peakers.” (Any further questions? It’s time for the Virginia General Assembly to amend the VCEA to reflect the actual, real-world LCOEs as explained in this new report.)
- “Our analysis shows that [solar, wind and batteries] SWB is much more cost competitive with coal, gas, nuclear, and hydro power than is generally believed because the [levelized cost of electricity] LCOE for conventional plants reported by mainstream analyses is unrealistically low.”
- “It is now obvious that new investments in conventional energy generation are not financially viable going forward” (Here in Virginia, that clearly implies that we build ZERO new fossil fuel projects, including the fracked-gas Mountain Valley Pipeline or any new gas-fired power plants).
- Finally, see below for a video discussion of “The Great Stranding” (of obsolete/out-competed fossil fuel assets).