Structural Differences Between Non Renewable and Renewable Power Systems

Direct renewable energy sources - such as sunshine, wind, water and wave flow, or the cycles of ebb and tide - are freely available and hence not tradable commodities until converted into electricity, hydrogen or heat. Adding to this unique strength - seen as weakness in a primary resource and commodity-geared world - are continually lowered conversion or realization costs. End-user prices drop dramatically with expanding market application and uptake. By contrast, conventional and geological, i.e. fossil and nuclear, sources such as oil, gas or radioactive ore are not only inevitably rising in extraction cost and market price but also trapped in their dual character as mineral commodities and energy sources, greatly complicating and even polluting policy making. Paradoxically and tragically, the very shortcoming of rising scarcity and price exerts enormous temptations yet we press on with their promotion and use. The very innovation of carbon trading confirms this: it bestows the mythical status of a precious and valued commodity upon a set of toxic waste products: the greenhouse gas emerging from smoke stacks, tail pipes and ravaged forest soils.

In a theoretical and macro-economic sense, overall hardware or plant costs may be comparable between non-renewable and renewable systems - but these are subject to such greatly different investment and depreciation cycles, as well as distribution and ownership patterns that it is impossible to draw such comparisons with any practical purpose. Renewable and efficiency technology engenders and thrives on locally and community based arrangements, and is most readily spawned, deployed, owned, and managed in distributed ways. Herein lies a great challenge to a smooth energy transition: so many established ownership patterns, institutional arrangements and vested interests feel at risk, and need to be considered and engaged in effecting change.

Short-term and narrow individual, corporate or public revenue interests aside, the incentives to change are overwhelming across both net fossil fuel producing and importing countries. National economies from Australia to Malaysia, Russia and Venezuela are at great risk through their overdependence on oil, coal gas and uranium revenue streams - while some 40 less and least developed nations have to outlay more in oil imports each year than their national economies yield in available revenue (Scheer 2006). Yet there are those who still advocate economically and environmentally costly fossil and nuclear solutions for the 'Third World', whether based on endogenously or exogenously extracted sources, as a path from poverty over locally and community controlled, autonomous, sustainable solutions. Indeed, these would be unattractive to the purveyors of large-scale, conventional power systems: they are locally decentralized and hence outside central supply government control, or unprofitable to transnational operations.

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