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Systems Analysis

Net Energy Analysis: Calculating the energetic costs of grid-scale wind and solar power

Most economic activities "consume" more energy than they produce. For example, steel factories consume energy to produce useful products. Vehicles consume fuel to provide transport services for people. In contrast, primary energy extraction activities (extracting oil or building a hydroelectric power plant) supply fuel to society by delivering more energy than they consume. The laws of thermodynamics bound the efficiency of these activities and necessitate a fundamental truth: You have to spend energy to make energy. To be viable, an energy-production system must deliver more energy than it consumes. Furthermore, energy technologies cannot be evaluated in isolation, but only within the context of the technological, socioeconomic and natural environment in which they operate.

Figure 1

A big challenge for utilities is finding new ways to store surplus wind energy and deliver it on demand. It takes lots of energy to build wind turbines and batteries for the electric grid. But Stanford scientists have found that the global wind industry produces enough electricity to easily afford the energetic cost of building grid-scale storage.
CREDIT: Dennis Schroeder/NREL

Net energy analysis is a scientific method that weighs the energetic costs of energy production against the energy produced, with the goal of quantifying the overall energy efficiency of the production process. Net energy analysis can be applied to a single project or an entire industry over its lifetime.

Net energy analysis gained popularity among energy analysts in the 1970s and then fell from favor. However, the technique has regained popularity in recent years, spurred by concerns over oil depletion and interest in the energetic dynamics of a transition to renewable energy technologies, with much interest focused on a specific metric, the energy return on investment (EROI), sometimes called the net energy return. Net energy return is a key driver of the real price of energy and therefore has important implications for future economic prosperity.

Since 2013, a team of GCEP researchers has been conducting a series of net energy analyses on renewable energy technologies. The work -- led by Sally Benson, Charles Barnhart, Michael Carabajales-Dale, Adam Brandt and Matt Pellow -- has resulted in the publication of several peer-reviewed papers described below along with GCEP hosting a two-day Net Energy Analysis workshop at Stanford University.



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