The Clean Energy Transition Is Not Inevitable

And what that means we have to do next.

Source: EMBER

If you’ve been following energy news, you’ve seen the charts: beautiful S-curves snaking up toward 100% clean energy. Yes, right now, solar and wind are just 13.35%  of global electric generation, but this will inevitably increase, we are told. The reason? Market forces.

Energy journalist David Roberts explains his vision of a future of clean energy dominance by comparing the costs involved in clean energy to fossil fuels. We’ve harvested the easiest-to-find fossil fuels, he explains, but technology to extract them keeps improving, so fossil fuel costs have remained essentially flat. With wind and solar, however, the resource itself is free, so when the technology improves, it will simply keep getting cheaper.

This is a frequent refrain for Roberts, who concluded after several such charts on Feb. 1 that the clean energy transition was “unstoppable”; he claimed the same back in 2022 based on an analysis from RMI which suggested that renewable tech was on an S-curve, not a linear climb. Data from Ember, an energy think tank, shows that wind and solar are the fastest-growing forms of energy in history.

“The S-curve is a well-established phenomenon where a successful new technology reaches a certain catalytic tipping point (typically 5-10% market share), and then rapidly reaches a high market share (i.e. 50%+) within just a couple more years once past this tipping point,” explains Carbon Tracker. They go on to state that technologies like wind and solar “improve quickly by S-curves… Extraction projects [like oil and gas] are almost the opposite: one-off large scale complex efforts that are difficult, potentially impossible, to replicate and improve.”

This is a common claim among climate journalists and analysts: a transition to clean energy is inevitable and cannot be stopped. I understand why they want to believe this. People in our line of work analyze very bleak news while trying to offer cogent analysis on what must be done to reverse bad trends. It is only natural to want to seek hope.

But if clean energy’s triumph is baked in, what is going on with the other charts that show upward climbing curves? Global temperature, carbon content in the atmosphere, and other measures of ecological instability are all at horrific record highs.

Source: World Meteorological Association

Perhaps this discrepancy could be explained by other data from Ember, which shows that fossil fuel use hasn’t actually gone down at all; renewables have simply been layered on top.

Source: EMBER

How can charts show we are both going to win and going to lose at the same time? 

These narratives seem so jarringly disconnected from one another that they may as well come from different realities. Only one can be true: either a clean energy transition is inevitable due to market forces, or it is not.

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If the market growth of renewables is real, but clean energy isn’t actually displacing fossil fuels, it is urgent that we come to understand why.

One problem with Roberts’s analysis of cost trends is that, for the last half-decade, price has not been a barrier to renewables. But clean energy still just isn’t being built anywhere near the scale necessary to replace fossil fuels. If the green transition were inevitable due to economics alone, several disastrous regulatory decisions and laws would not have been able to stop it dead in its tracks. Yet they did:

The rooftop solar industry in California has been destroyed. Only 15% of rooftop solar demand remains after a single California Public Utilities Commission (CPUC) decision. And that’s even worse than it sounds, since CA’s municipal utilities aren’t subject to the CPUC regulation, and serve about 15% of California’s customers, meaning a single bad regulatory decision may well kill virtually all of the rooftop solar jobs within its jurisdiction. Not content to stop there, CPUC also gutted battery storage and community solar. CPUC’s supposed rationale was that these “reforms” would stop utilities from raising rates, which, of course, utilities have continued to do.

The bad news is not limited to rooftop solar or California. Due to fossil-fuel-backed bills and rampant misinformation, it is becoming effectively illegal to build utility-scale wind and solar in Indiana and Ohio, where mere nudges like tax credits and low module prices will not be capable of reversing or even mitigating the situation.

Some other US states are actively seeking to increase the amount of fossil fuels they burn. In Florida, the state gutted their own administration’s basic abilities to regulate safety and appliances, explicitly in the name of climate denial. Because of Texas state policy, cryptocurrency and AI “data centers” are keeping pace with the addition of clean energy megawatts to the Texas grid and justifying a massive addition of gas power plants. In Virginia, the same culprits are forcing utilities to cancel plans to shutter fossil fuel power plants. Meanwhile, a fossil-fuel-industry-led backlash against ESG has resulted in some states investing more in fossil fuels, while ESG itself barely delivers any results for green energy. One of the most offensive examples of bad policy halting transition away from carbon occurred while this article was being drafted, when NY Governor Hochul unilaterally decided that congestion pricing, one of the state’s signature climate reforms, just wasn’t going to happen.

It is not even always necessary for the industry to sabotage clean energy, when simple apathy from regulators is sufficient. The “interconnection queue”, in which solar and wind projects must sit while nothing gets built, wastes five years per project. The logjam in the queue is getting worse. There is no valid reason for it to take this long to hook up solar projects; the system was simply designed poorly. Federal Energy Regulatory Commission (FERC) reforms and DOE recommendations are likely to improve it from five years to perhaps three or four, while what we need is to abolish the queue altogether, a solution that no policymaker seems to be considering.

As for the prediction that technology will save the day, the opposite seems at least equally plausible. Microsoft has defied their own net-zero plans and increased their emissions to churn out useless AI “products” that nobody asked for. And if you don’t think Microsoft belongs in a list of policymakers, the bad news is that, contrary to popular belief, America does have a planned economy. It’s just partly planned by people in boardrooms, and we can’t vote them out.

Policy trumps the market every time, and bad policy is likely to become more and more common as the fossil fuel industry struggles to maintain its social license to operate. They understand that their profits are at risk, and they will not sit back and allow market trends which do not benefit them to proceed to their conclusion. The fossil fuel industry has access to legislators and regulators who wield more power than the market. When an S-curve hits a policy barrier, it crashes like a Tesla on autopilot.

Analyses that are based solely on past trends fail to take into account the impacts of future reactionary policy. These analyses won't reflect the impact of bad policy until it has already been felt. For example, the ban on utility-scale solar and wind, which is growing and will soon cover virtually the entire state of Ohio, won’t show up in these charts until 2028 or so. That’s when the projects that are currently in the interconnection queue will emerge from the queue and get built. After they are done, there will be next to nothing new built. An S-curve of solar in Ohio is going to lead up all the way to 2028 and then plunge off a cliff. Any policy-based analysis of the future of wind and solar in Ohio would catch this obvious problem, but a market-trends analysis would incorrectly predict that 2029 would be the best year ever for solar in Ohio. 

Analyses that are based on falling module costs alone, furthermore, assume utilities are rational actors, and will simply build whatever is cheapest. From my own personal experience fighting utilities, I can assure you that they operate based on inertia more than spreadsheets. For example, I watched one utility move forward with a fossil fuel expansion plan which their own analysis showed would be $174 million more expensive than clean energy. Utilities stick to what they know unless they are forced to do something different.

Inertia is one cause of the slow deployment of renewables, but deliberate obstruction is also to blame. The fossil fuel industry will fight against any market-driven energy transition. Therefore, such a market-driven green transition will proceed only in fits and starts: in one jurisdiction but not another, with a partial solution here and greenwashing there. The market might want to head toward clean energy, but that does not mean a clean energy transition is inevitable.

There is a flip side to the same principle. When the market wants something bad, that bad thing is also not inevitable.

We could defy the analyses which show, horrifyingly, that AI and crypto “data centers”, which churn out nothing but worthless garbage, could consume 9% of American electricity in just six years. Projections are just that, and even the bad ones would shatter if they hit a brick wall of policy. Make zoning approval impossible for bitcoin mines to obtain, or make it impossible to connect them to the grid, and watch these parasitic industries die. It does not matter how much VC money they have or how charismatic their CEOs are if they cannot build their physical infrastructure.

Climate activists have often used policy to defeat the market, producing good results:

Teleworking due to COVID policies in 2020 briefly cleared the skies in Los Angeles for the first time in living memory. (This is also instructive because when this policy stopped being policy, the pollution came back.) Last year, Michigan passed siting reforms that make it impossible for fossil fuel interests to effectively ban solar and wind development, as they did in Ohio and Indiana. Before this law entered effect, Michigan had been on a quick march toward becoming another such state where solar and wind installations cannot be built. With the passage of Build Public Renewables into law in New York, the State will build renewable energy itself, awarding discounts to ratepayers and paying living wages to workers. Across the border in Vermont, meanwhile, a climate superfund law entered effect, allowing the state to hold corporate polluters accountable for damages caused by climate change. Following a herculean grassroots effort to elect Luiz Inácio Lula da Silva in Brazil, Lula instituted a “Solar for All” program that caused the country to leapfrog from twelfth place to sixth place in megawatts of installed solar in a single year.

My personal favorite bit of good news came from Colombia. That country’s fossil fuel industry, which long dominated regional politics, has entered what the industry describes as a “death spiral”. This once-unthinkable outcome is emerging after less than two years of policy under President Gustavo Petro’s government, which has banned new oil extraction sites and has banned fracking. The market for oil and gas does not enter into the equation if drillers are not allowed to operate.

None of these policies emerged fully-formed from market demands. In each case, activists, organizations, and lawmakers fought for years, first to be in a position to win, and then to actually pass them. The Build Public Renewables Act only passed in New York because of years of organizing and a refusal to accept failure. None of these wins happened because of market dynamics or S-curves.

Unfortunately, however, every one of these good policies can be undone. Rooftop solar in California enjoyed decades of progressive policy and market growth, and it was still killed dead overnight by the CPUC. For another example, it may be possible for BPRA’s opponents to blunt the law’s impact at the regulatory level, and it certainly seems like fossil fuel industry allies are trying to do so. The organizers behind BPRA are working hard to see that it goes into effect, but it appears to have been implemented too slowly to halt the death of offshore wind in New York. No win can be taken for granted, not even when it has already happened. As for Brazil, Lula isn’t perfect. He also approved new drilling in the Amazon basin, and deforestation during his current presidency has slowed, but not stopped, and certainly has not reversed. And the gas industry is not going to sit by quietly and endure their death spiral in Colombia; when Petro is termed out, which will be soon, they will push for a policy reset. There is no reason to think it will be easy to defeat the industry a second time, but if we want a habitable planet, we must do so, over and over again.

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There is only one trendline chart that matters: the accumulation of carbon in the atmosphere, and until that trendline starts to go down, claims of imminent and inevitable techno-utopia should be met with skepticism. We cannot sit back and relax while sober economics takes hold and technology solves the crisis for us. It won’t. Technology is giving us AI “therapy” chatbots and ape JPGs. Only aggressive policy can win results. We have to be vigilant about every single local and federal election, show up to regulator meetings, and vigorously defend everything we’ve won, or everything we’ve achieved can be undone in a heartbeat. 

In 2022, I wrote that the passage of the Inflation Reduction Act did not mean that we could step back from our work. The political establishment had claimed victory, but the job was less than half done. And now, in 2024, we’re being told again that we can relax, because The Market will inevitably produce a specific result. But there is no guarantee of a positive outcome unless we guarantee it ourselves.

Tom Pike is an environmental policy analyst at Protect PT by day and a climate justice activist by night. His solarpunk short stories “Prompt Injection”, “The Compromise”, and “Strange Events at Fletcher and Front!” can be read in upcoming issues of Analog Science Fiction & Fact.