Renewable Energy…How Effective Is It Really? (Advantages And Disadvantages)

With a global market value of $ 1.1 Billion, the renewable energy sector is one of the fastest-growing niches in the world energy market.² According to the following statistics from the,³ the sector’s future is even brighter.

• The US solar energy sector is projected to grow by 80 percent up to 2050
• The rest of the renewable energy market in the US is set to grow at an annual rate of 21 percent up to 2050
• Renewable energy will form 42 percent of US total energy consumption by the end of 2050.

These statistics point to a well-performing renewable energy sector that will enjoy favorable growth in years to come. Unfortunately, this performance is more than likely to distract people from the main objective of this growth… to combat the climate crisis.

You see, the exemplary performance of renewable energy globally is not by accident. Nations all over the world are committed to creating favorable conditions for the growth of the sector. Underpinning this determination is the need to keep global warming within a 2-point degree from pre industrial revolution limits. Climate change enthusiasts should not lose sight of this critical objective. Instead, renewable energy should be viewed through the lenses of climate change.

The real question on everyone’s mind should be: how well does renewable energy reduce global warming?

While renewable energy innovations are a technological hallmark, their carbon reduction potential is lower than most people assume. For those who take carbon offsetting seriously, reforestation projects offer an alternative to renewable energy emission reduction options after reviewing renewable energy advantages and disadvantages.

Effectiveness of Renewable Energy in Emissions Reduction

Last year, researchers from Oxford University shared a set of principles to follow when reducing an individual’s or an organization’s carbon footprint.¹ These principles provide a good set of conditions to think about effectiveness, before looking at how renewable energy emission reduction options align with these principles.

Oxford Principles of Carbon Offsetting

1. Use High-Quality Offsets

This principle recommends using offsets that ensure an organization reduces its emissions, has environmental integrity, and is transparent.

This entails reducing scope 1 level emissions (emissions coming directly from a person or company’s activities), while ensuring that the procured offset does not harm the environment.

The offset should also be easy to validate and confirm it has achieved its targets. For example, in ecosystem restoration projects, one should be able to ensure the presence or absence of activities such as planting trees reasonably quickly.

2. Use Carbon Removal Offsets

This principle demands that individuals and companies procuring offsets ensure that the offset leads to actual carbon removal.

Important to note here is that not all offsets remove carbon dioxide from the atmosphere. Some avoid emissions by engaging in activities aimed at preventing further emissions from occurring, simply called carbon offsets.

Only carbon removal offsets realize carbon removal in real terms. When procuring an offset, to make the highest impact, one must ensure it is a carbon removal offset and not just a standard offset. Reforestation or afforestation projects are an excellent example of carbon removal offsets.

3. Use Long-Lived Storage

This principle is related to the first and the second, because it emphasizes ensuring that offsets remove carbon dioxide from the atmosphere.

This principle, however, takes this removal a step further by advising people to ensure that carbon dioxide is stored in carbon sinks that also prevent the gas from leaking back into the environment.

Good offsets ensure that carbon is removed from the atmosphere and stored in carbon sinks within the soil permanently. A good example here is reforestation projects, which are known to adopt long-lived storage in the form of soil-based carbon sinks.

4. Support Net-Zero Offsetting

Net-zero offsetting ensures that companies remove their entire carbon footprint.

The goal here is not just to reduce CO₂ emissions by eliminating them. Furthermore, zero offsetting entails supporting long-term agreements aimed at emission reduction, forming sectoral alliances, and supporting ecosystem restoration.

This principal recommends going the extra mile beyond buying offsets to ensure that emissions reduction plans accommodate future activities. Compared to other carbon offsets, reforestation projects tick all the net-zero offsetting boxes since they are part of broader emission reduction efforts, entail collaborating with local communities, and support wildlife and other ecosystem-related restoration activities.

How Effective Is Renewable Energy in Emission Reduction?

This section will look at how attempts to reduce emissions through renewable energy align with the best practices recommended by Oxford University in the previous section, by reviewing renewable energy advantages and disadvantages.

Typically, people keen on reducing emissions by adopting renewable energy have three options at their disposal. The first is to procure a renewable energy carbon offset, the second entails buying renewable energy certificates, and the last option is to invest in renewable energy projects directly.

We will explore each of these options in greater detail later. For now, let us look at how each of these options is aligned with the Oxford principles

From the table, most renewable energy emission reduction options do not adhere to the principles shared by Oxford University. While renewable energy offsets reduce emissions and aim at zero offsetting, they do not necessarily remove carbon dioxide from the atmosphere. Moreover, most do not have carbon sinks to store the carbon dioxide permanently in the soil.

On the other hand, renewable energy certificates do not reduce emissions, extract carbon dioxide from the atmosphere, adopt sinks, or even support zero offsetting. Instead, they show that a company uses renewable energy in operations, which does not necessarily mean they have offset their carbon footprint.

The direct investment option seems much better. The option eliminates emissions, removes carbon dioxide, and aims at zero offsetting. Unfortunately, the option does not adopt carbon sinks and may be beyond the financial reach of many people. This is so considering the cost of directly investing in renewable energy is high and beyond the reach of most investors.

To sum up, while renewable energy offsets do have their merits, using them to reduce emissions does not align with the principles shared by researchers from Oxford University.

We will share examples of carbon offsets such as reforestation projects that are aligned to these principles later, but first, let us look at renewable energy emission reduction options in greater detail to appreciate their value.

As will be noted, despite the mentioned limitation, renewable energy emission reduction options have noble goals and do an excellent job in supporting the energy sector.

Renewable Energy Emission Reduction Options

The current push towards adopting renewable energy came after global calls to action to reduce greenhouse emissions. Renewable energy emerged as a better alternative to fossil fuel that power producers and consumers could turn to minimize emissions. That is why serious climate change players insist that renewable energy should be viewed through the lenses of climate change. Its primary objective was and should remain to reduce greenhouse emissions. All other benefits of the technology are secondary.

As the push towards a climate-friendly planet kept rising, global governments came together to discuss more options for reducing greenhouse gasses. Within the renewable energy sector, three options were suggested as viable ways for engaging in activities to reduce emissions.

As already noted, the options were offsets, renewable energy certificates, and direct investments. Each option is unique and serves a different purpose. Their distinction is summarized below:

Renewable Energy Offsets

Renewable energy offsets refer to a set of activities aimed at reducing greenhouse emissions through the adoption of renewable energy technologies. The main benefit of this option is that it allows climate change practitioners to offset their scope 1,2, and 3 level emissions by engaging in offsetting activities in any part of the world. The offsets must be well accounted for and validated to confirm additionality. “Additionality” refers to the property of the engaged project to reduce emissions below a targeted baseline.

While offsets are an excellent way of reducing carbon emissions, renewable energy offsets have their fair degree of challenges. For one, most renewable energy offsets do not achieve their targeted emission reduction objectives. An illustrative example here is methane reduction renewable energy offsets, which achieves a mere 35 percent of their emission reduction targets.⁵

Renewable energy offsets are also difficult to validate, due to the complexity of the innovations, and the carbon trading marketplace in general.

Renewable Energy Certificates

In comparison, renewable energy certificates are much simpler to use. Adopting them entails procuring a claim regarding an organization’s state of electric power use.

The claim, presented in Megawatt-hours, shares the proportion of a company’s energy consumption from renewable energy sources. For example, a renewable energy certificate of 1,000 Megawatt-hours implies that the owning organizations use that amount of power from renewable sources. This renewable energy certificate option also carries the benefit of supporting the progress of the entire energy sector.

Unfortunately, the certificates only demonstrate a commitment to adopting renewable energy. The commitment does not confirm that, indeed, a company has reduced its carbon footprint.

Renewable energy certificates also only reduce market-based scope 2 level emissions.⁴ That shows that a company is using more renewable energy sources, but does not imply that the company is reducing its carbon footprint. Offsets are a much better option when one is keen on reducing their carbon footprint and not just using more renewable energy.

Renewable Energy Direct Investments

This option entails directly investing in a renewable energy project. As such, its value is measured in actual costs incurred per kilowatt-hour of renewable energy generated, or per carbon dioxide unit offset from adopting renewable energy.

This method of getting involved with renewable energy is the best for companies keen on lowering their carbon emissions, while supporting the renewable energy sector. It allows companies to offset their emissions directly without going through the carbon trading marketplace, while also boosting the growth of the renewable energy market through direct financial support.

The major drawback of direct investments is that they require substantial investments beyond the reach of many companies and individuals. The cost of renewable energy installations is relatively high, and only large-scale multinational corporations have dared to pump cash into the niche.

Even then, most of these companies have had to rely on government support and loans to finance the investment. These financial barriers to entry make direct investment options a viable alternative to large companies only, effectively locking out a significant proportion of emitters.

Drawbacks of Renewable Energy Emission Reduction Options

As already noted, these emission reduction options from renewable energy have different goals, including emission offsetting, promoting renewable energy use, and supporting the sector. Unfortunately, these goals are not in line with the primary purpose of supporting renewable energy – to combat climate change.

For this reason, most renewable energy emission reduction options are not aligned with standard best practices of emission reduction shared by Oxford University researchers.

Reforestation carbon offset companies offer a much better alternative.

Reforestation as An Alternative to Renewable Energy Offsets

Reforestation projects are one of the most suitable alternatives to renewable energy offsets. After reviewing renewable energy advantages and disadvantages, reforestation projects are more aligned with all the principles shared by Oxford University researchers. Mainly, they are easy to verify and validate. There are many verification or certification companies out there for forestry offsets, but all one needs to look for is trees in the project location, making them high-quality but straightforward offsets.

Moreover, reforestation projects remove carbon dioxide from the atmosphere. They do this through photosynthesis, where the trees use carbon dioxide from the air to form food. This direct removal of atmospheric carbon by trees makes them quality carbon removal offsets.

After extracting carbon dioxide from the air, trees sequester the carbon back into the soil. By trapping soil sediments as the trees grow, more carbon dioxide is stored in soil-based carbon sinks, making tree projects good at adopting long-lived carbon storage. Lastly, trees support net-zero offsetting by extracting carbon dioxide from the air and sequestering it into the soil, in line with Oxford University Standard Best Practices on offsetting.

Aside from the Oxford standards, forestry offset projects do more than simply reduce CO₂ in the atmosphere. Tree planting also prevents flooding and erosion, provides habitats for endangered species, and results in many benefits to the local ecosystem and communities.

So, if you’re looking into ways to reduce your emissions, or the world’s emissions as a whole, renewable energy certainly has its merit, but forestry projects have certain qualities that make them more suitable for direct, meaningful change.

Calculate your carbon footprint to begin with, and then consider the various options for renewable energy and the other most popular types of carbon offsets, so that the Earth can start healing today.