Beyond solar and wind: What decarbonization looks like in 2021

The global energy transition is gaining momentum as political, policy and investment priorities converge in the U.S., Europe, China and elsewhere.

Decarbonizing the power sector, as President Biden has pledged to do by 2035, is a laudable step toward a clean energy future and for good reason. The U.S. electric sector has reduced carbon emissions 33 percent since its peak in 2007 — double the rate of the wider economy — and now accounts for less than a third of total U.S. energy-related CO₂, according to the Energy Information Administration, the Energy Department’s statistical arm.

The progressively diminished carbon intensity of the U.S. power sector is both the predominant decarbonization trend of the last decade and the keystone of continued economy-wide decarbonization. As we saw in 2020, investors, consumers and policymakers will grow increasingly interested in decreasing our carbon footprint over the coming decade as the electrification of buildings, industrial processes and especially transportation — today the most carbon-intensive sector — continues to attract economic and political capital.

To face these challenges head on, the Electric Power Research Institute (EPRI), joined by Gas Technology Institute (GTI), is accelerating low- and zero-carbon energy technologies through the Low-Carbon Resources Initiative. This $100+ million initiative, launched in 2020, is targeting fundamental advances in low-carbon electric generation technologies and low-carbon energy carriers, providing scientific credibility and objectivity to the global decarbonization effort.

But this broad, decade-defining trend belies the nuances of decarbonizing the power sector in the decade ahead. Cleaning-up the power sector in line with Paris Agreement targets entails more than scaling-up renewable energy developments and continuing to abate power generation emissions.

Well-established trends toward increasing clean electricity supply and demand were further entrenched by the COVID-19 pandemic. The trends that will define this next stage in power sector decarbonization include the roll-out of long-duration energy storage systems, the proliferation and integration of community microgrids and the electrification of transportation.

Let’s start with long-duration energy storage which is essential to support renewable primary energy resources as part of a fully decarbonized electric power sector. Renewable energy resources generate variable levels of renewable electricity, so increasing the amount of renewable electricity on a given grid requires flexibility-add mechanisms. These range from the ubiquitous lithium ion batteries to emerging alternatives like zinc-air and vanadium redox flow battery systems, as well as hydrogen- and ammonia-based energy storage.

Each technology has merit, receiving mixed investor interest and support from policymakers. We can expect that the market and regulatory forces driving the expansion of renewable electricity supplies will have a similar effect on long-duration energy storage options. What’s less clear though is how these storage technologies will be diffused and leveraged across the power sector.

This is a central question for utilities and other power providers charged with leveraging renewable energy towards grid decarbonization. Doing so effectively requires strategic investments in the electric power transmission and distribution (T&D) system and corresponding regulatory support. And if the emerging tendency among power supply-side decisionmakers to consider storage as a transmission asset shows us anything, it’s that the deployment of energy storage assets over the next decade will be guided as much by considerations for energy delivery as for supply.

Decarbonization initiatives may make communities more dependent on the reliability of the electric grid. Evaluating opportunities for microgrids, community solar, and energy storage technologies in advanced energy communities can improve reliability and resiliency while serving as resources to offset the costs of decarbonization. Like energy storage assets, community microgrids and electric vehicles (EVs) are increasingly treated as mechanisms for enhancing the grid; distributed energy resources (DERs) can help clean electricity producers and end-users better communicate while adding load flexibility to the grid.

Community microgrids are ideal delivery networks for locally generated renewable power that is either used on-site in tandem with community storage or dispatched over larger, centralized T&D systems. Distributed power supply networks present opportunities to limit electricity losses, reduce localities’ dependence on bulk power systems and ultimately afford end-users greater discretion over their local energy supply.

Beyond the transportation sector, EVs will play a significant role in decarbonizing the electric power sector. President Biden has “vowed” to electrify the U.S. government vehicle fleet and establish incentive programs for American car owners to replace their internal combustion engine vehicles with electric alternatives. And with EVs expected to account for 40 percent of U.S. new vehicle sales by 2030, it’s safe to designate the electrification of transportation as the most formative, most disruptive trend for the power sector to 2035, if not decarbonization as a whole.

For utilities, accommodating these new loads may require investments in new substations, upgraded power lines and other grid infrastructure. But, with the proper balance of storage and distributed microgrids, utilities can establish vehicle-to-grid (V2G) integration systems that “close” the power generation, delivery and utilization “loop.” This provides another means of balancing variable renewable electricity and increasing demand for clean electrons.

Clearly all of these trends are both caused by and are contributors to the continued scale-up of renewable energy supplies on the grid. Increasing grid supplies of clean yet variable power requires reciprocal increases in integrated DERs to maintain resilience and reliability, plain and simple.

Looking deeper, though, we see that central to each of these trends is the end-user. Indeed, these changes to our methods of generation, delivering and utilizing electric power correspond to shifts in the power dynamic between producers and consumers. This shift coincides with what may prove to be the most impactful trend in this next stage of power sector decarbonization — the prioritization of equity and environmental justice by power sector investors, policymakers, regulators and consumers. This is reflected in the Biden administration’s early climate and energy actions.

It is possible to drive decarbonization while preserving equity and environmental justice.

Optimizing societal benefits requires that industry stakeholders — utilities, regulators, policymakers, and investors — work together to ensure the associated costs and benefits are distributed fairly. It will be the extent to which those costs, economic and otherwise, and their attendant benefits are justly distributed across social, economic, political, and technical boundaries that define this chapter.

Robert Chapman is SVP of Energy Delivery and Customer Solutions at the Electric Power Research Institute (EPRI).