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The benefits and costs of generating energy from renewable sources

Foto: Christine F. Solbakken, NILU

From NILU’s Annual Report 2020: Renewable energy sources (RES) such as wind or water have become increasingly important for the energy sector in recent decades. But does increased use of RES for electricity production have exclusively positive impacts?

Moving from fossil fuels to renewable energy sources is a key part of climate change mitigation strategies worldwide. In 2020, NILU studied the environmental costs and benefits associated with the increased use of renewable and low-carbon energy sources for electricity production in the European Member States (EU-27). The study was part of NILU’s work carried out as partner in the European Topic Centre for Climate Change Mitigation and Energy (ETC/CME). The Topic Centre was funded by the European Environment Agency (EEA).

Environmental footprint of electricity production

“In order to estimate the environmental footprint of an economic activity, such as generation of electricity, we use the method Life Cycle Assessment (LCA),” explains Dr Evert Bouman. Bouman is senior scientist at NILU’s department for Environmental Impacts and Sustainability and leader of the ETC/CME study.

“LCA assesses environmental impacts associated with all stages of a product’s lifetime, such as the extraction of raw materials, processing, manufacture, distribution, use, and its disposal/recycling. This process covers all stages in the life cycle – from ‘cradle to grave’,” continues Bouman.

Using an LCA model, life cycle environmental impacts were calculated for annual electricity production in the EU-27 across a range of impact categories, such as climate change and particulate matter formation. The results were subsequently compared to a “no-action” counterfactual scenario, which describes a European electricity system where the level of electricity production from renewable sources was kept the same as it was in 2005.

Comparing the life cycle impact potentials in the two scenarios allowed Bouman to calculate benefits and costs associated with the increased introduction of renewable energy sources in the European electricity mix.

Reduced impacts through RES…

“Our results show that the impact of electricity production differed considerably depending on the energy source being assessed. In addition, impact indicator values for single energy sources varied considerably across different Member States and years. This depended, for example, on the annual variation in efficiency of fuel combustion and utilisation of available electricity production capacity,” explains Bouman. “Overall, we see that the increased use of renewable energy sources has led to an absolute decrease in potential negative impacts for most impact indicators investigated in the study.”

He explains that there are two key contributing factors. Firstly, the use of renewable energy sources (RES) is generally less polluting than the use of fossil sources for energy generation. Secondly, the share of RES in the European electricity mix has increased considerably in the period 2005-2018. The increased production of onshore wind power and solar photovoltaic power, followed by electricity production from bioenergy sources biogas and solid biomass, thus contributed to lower life cycle impacts, as indicated by a decrease in total greenhouse gas or particulate matter emissions.

…but there are trade-offs

The figures on the left show developments in greenhouse gas emissions (expressed as Mt CO2-eq) and formation of particulate matter (expressed as Mt PM10-eq) due to annual electricity production in the EU-27 for both the actual emissions and the “no-action” counterfactual scenario.

The illustration shows that the use of RES has led to a decrease in greenhouse gas (GHG) emissions. The difference between the two scenarios presented on the left can be interpreted as “gross avoided impacts”.

The figures to the right show the individual contribution of RES to the annual avoided impacts. All electricity from renewable sources contributes to avoided impacts in terms of GHG emissions. For particulate matter formation, however, the increased combustion of biomass such as wood contributes negatively to avoided emissions. This trade-off of biomass combustion for electricity is however more than compensated for by positive contributions from the other renewable energy sources.

Bouman’s study revealed other effects caused by the increased use of RES, such as heightened potential for ecotoxic releases to freshwater (e.g., related to value chains associated with the production of solar photovoltaic power) and a larger “land footprint” associated with electricity production. The “land footprint” refers to the area of land occupied over time and is mainly related to electricity production from solid biomass, for example through the area dedicated to growing trees for fuel. These effects are also called “environmental problem shifting” – unforeseen negative consequences in the use of renewable energy sources.

The way forward

“The report shows that the increasing production of electricity from renewable sources has decreased greenhouse gas emissions significantly in the period between 2005-2018, as it has substituted the use of fossil fuel,” concludes Bouman. “We could also identify avoided formation of particulate matter, acidification and eutrophication.”

However, Bouman says that these benefits come at a cost of increased toxicity and land occupation. Despite trade-offs, Bouman could also demonstrate that the positive effects of individual renewable energy sources can compensate for negative effects associated with other renewable energy sources. The report shows the importance and necessity of assessing RES holistically, since most climate change mitigation options have an upside and a downside, which then has serious consequences for environment and humans.

“The report has been published by the ETC/CME. We hope that it provides valuable information for policy makers as they continue shaping the use of renewable energy sources in Europe,” Bouman concludes.

Read more in the report A life cycle perspective on the benefits of renewable electricity generation, ETC/CME EIONET report 4/2020.