Renewable Energy’s Impact on Utility Costs and Reliability

October 9, 2024

Solar Panel

Source: WISH-TV / WISH-TV

WEST LAFAYETTE, IND — Renewable energy is helping meet growing electricity demand but also affecting utility costs, says Andrew Liu, a professor at Purdue University’s Edwardson School of Industrial Engineering.

“As transportation, heating, and cooling switch to electric power, electricity demand is expected to rise by 20% over the next five years and even more in the coming decade,” Liu said.

Liu explained that renewable sources like wind and solar are now cheaper to build and operate than fossil fuels. However, they can only produce energy during certain times, making them less reliable than natural gas and coal plants.

“Electric bills have two parts: the cost of generating electricity and maintaining the infrastructure to deliver it,” Liu said. “Higher bills aren’t because of renewable energy, but increased demand for natural gas, especially during winter.”

Liu said new technology like long-term energy storage makes renewable energy more reliable. He also pointed to energy demand response programs, where consumers adjust usage based on grid availability to reduce costs and prevent blackouts.