What does this mean for traditional generation? You are talking a lot about renewables and wind. What does this mean for the ways we traditionally generated power?
Well, really what it means is that we have to look at how we deliver power differently. I don't think we can look at large central station generation the way we have in the past. Certainly, it is going to be needed to some degree, we have substantial amounts of coal and nuclear and natural gas—central generation currently in this country—but because of the distributed generation from wind, solar, geothermal and hydrokinetic, I think we are going to have to develop a different grid that can accommodate that in a much more efficient way. So, the central generation—traditional generation—will still play a part, will still play a role in the future, but I think that role will be much different one and it will be a diminished one as more and more of these renewable resources come on line. And we are seeing that accelerate very quickly.
What kind of scale of transformation are we talking about in order to—as far as the electricity generation transmission goes—effect this change?
Well, it is going to be incremental ultimately. But we are talking about a transformation across the entire country. So we are talking about potentially tens of thousands of miles of new transmission lines to ultimately move large amounts of wind, solar and other resources to loads. We are talking about in the scale of billions of dollars of investment in smart-grid technologies all the way from the consumer level up through to the transmission and generation level. So the scale is very large but, fortunately, you know, it is something we can do incrementally, and it is something that we have already started to do with the stimulus money and with efforts by individual utilities and other private entities as well.
What will it mean if we don't do this? What will that mean for the U.S.? If we don't make the investments that you are talking about, if we don't build a smarter, more robust grid and different source of generation?
Well, quite simply, if we don't do what I am suggesting—and that is look at the lowest cost, most effective renewable resources that need to be developed, and then allow them to be developed, and also allow them to be delivered to the highest cost areas of our country—we are going to pay more for electricity. That is all it means. It means that we will put in place much more expensive electric systems…. A nuclear power plant is $10 billion a pop—that means that you are going to be paying 15 cents a kilowatt hour. You can deliver a lot of wind for that. You can deliver probably lot of concentrating solar [power] for that as well. I know you can deliver geothermal energy all day long for half of that. So if we don't start looking at how we are going to deliver these resources that are ultimately at a lower cost, we are going to pay a lot more for it. That is all. We are going to pay a lot more for the energy if we don't figure out how to deliver it to the loads.
But the U.S. has a lot of coal and, currently, coal is even cheaper.
Coal may be cheaper if we don't capture the carbon and sequester it, but I think everybody understands we can't do that anymore. So, ultimately, if we have to capture the carbon and we have to sequester it then we are starting to talk about coal power prices ultimately that may be close to the ones for that $10 billion of nuclear power plant. So, again, let us look at the lowest cost thing to do. The number-one lowest cost thing to do is energy efficiency. We need to do that everywhere in this country, and there have been large barriers to doing that for long time. We need to reduce those barriers. The first barrier is cost of capital. The other barrier is information. Another barrier is the disconnect between landlord and tenant where you have commercial buildings that you have the landlord who has no incentive to improve the efficiency and the tenants want to do the efficiency. We are in a building right here, we are sitting in one today, that is just like that because FERC doesn't own this building. I want to do the energy efficiency, the landlord doesn't. So, ultimately, you know we can't get it done. So let us break down the barriers of doing energy efficiency. After we do the energy efficiency, let us do the next least-cost thing we can do: I think that is wind. Wind is the next least-cost thing that we can do in this country. Geothermal, hydrokinetic, solar—let us start looking at what our least-cost resources are, and let us get them developed and let us get them delivered to loads.
Editor's Note: David Biello is the host of a forthcoming series on PBS, titled "Beyond the Light Switch." The series, produced by Detroit Public Television, will explore how transformation is coming to how we use and produce electricity, impacting the environment, national security and the economy.