1. Islands & Renewable Energy
Geoffrey Heal
Columbia Business School
Verdana 10 minutes max

2. Renewables vs Fossil
In mainland US, wind & solar PV are less expensive than fossil energy*
Wind
$29-56 mWh
Solar PV
$36-44
Gas (combined/single cycle)
$41-74/
Coal
$60-143
* Lazard’s LCOE v 12

4. Renewables vs Fossil
On a low-latitude island, solar is more productive and wind has a higher capacity factor, so both are less expensive
Gas and coal however have to be imported and are more expensive than on the mainland
Tilts the playing-field further to renewables

5. Intermittency & Batteries
Li-ion
Development of Lithium Batteries
Gravimetric Energy Density (W.h/kg)
Cost (US$/kW.h)
3000
2000
1000
300
200
100
Year
2015
1970
1980
1990
2010
Ni-MH
Ni-Cd
Battery storage cost falling fast
Large-scale storage now economically viable

6. Intermittency & Batteries
Battery prices still falling
Expected to be under $100/kWh within two years

7. Financing
Renewables + storage can provide power at lower cost than fossil fuel
But needs more investment up front: all costs are capital costs, no fuel or operating costs
Pay everything before any power generated, rather than 50% up front and the rest over the life of the project

8. Financing
Means privatization of power plants or raising capital from capital markets
Latter probably not possible
So need to bring in private capital to finance power plants