Renewable Resource

What Is a Renewable Resource?

A renewable resource is one that can be used repeatedly and does not run out because it is naturally replaced. Examples of renewable resources include solar, wind, hydro, geothermal, and biomass energy.

Understanding Renewable Resources

Essentially, a renewable resource is a commodity of which there is an endless supply. Some resources, unlike the sun, wind, or water, are considered renewable even though some time or effort must go into their renewal. Most precious metals are renewable also. Although precious metals are not naturally replaced, they can be recycled because they are not destroyed during their extraction and use.

Unlike renewable resources, once a nonrenewable resource is depleted, it cannot be recovered. As the human population continues to grow and finite resources become increasingly scarce, the demand for renewable resources increases.

Biofuel, or energy made from renewable organic products, has gained prevalence in recent years as an alternative energy source to nonrenewable resources such as coal, oil, and natural gas. Although prices are still higher for biofuel, some experts project that, due to increasing scarcity and the forces of supply and demand, the prices of fossil fuels will grow higher and higher, making the price of biofuel more competitive.

However, prices for fossil fuels have trended lower, in part because of technological gains in fossil fuel production. Commodity buyers and policymakers constantly need to balance considerations of such influences when forecasting future price changes.

The COVID-19 pandemic has only deepened the trend towards lower fossil fuel prices due to record-low consumption in 2020.

Types of biofuel include biodiesel, an alternative to oil, and green diesel, which is made from algae and other plants. Other renewable resources include oxygen and solar energy. Wind and water are also used to create renewable energy. For example, windmills harness the wind's natural power and turn it into energy.

The Global Trend Towards Renewable Resources

Renewable resources have become a focal point of the environmental movement, both politically and economically. Energy obtained from renewable resources puts much less strain on the limited supply of fossil fuels, which are nonrenewable resources. The problem with using renewable resources on a large scale is that they are costly and, in most cases, more research is needed for their use to be cost-effective.

Beyond their limited supply, energy sources such as fossil fuels damage the environment when burned and contribute to global warming. The first major international accord to curb carbon dioxide emissions and global warming was the Kyoto Protocol, signed in 1997. More recently, global powers met in Paris in 2015 to pledge emissions reductions and focus on higher reliance on renewable resources for energy.

There are many incentives designed to encourage the use of alternative energy. For example, energy taxes place a surcharge on fossil fuels so that the prices of renewable resources are more competitive and people will be more inclined to use renewable energy. Green funds, investment vehicles such as mutual funds, support eco-friendly and sustainable companies by investing in them and helping to promote environmental awareness.

These incentives seem to be having an effect. According to the U.S. Energy Information Administration (EIA), In 2020, renewable energy provided approximately 11.6 quadrillion British thermal units (Btu). (One quadrillion is 1 followed by 15 zeros.) This amount of energy represented 12% of total U.S. energy consumption. The electric power sector consumed around 56% of U.S. renewable energy in 2020, and approximately 20% of U.S. electricity generation was from renewable energy sources.

State and federal governments have encouraged more biofuel consumption by imposing requirements and incentives for the use of renewable energy. The EIA anticipates that U.S. renewable energy consumption will continue to increase through 2050.

What Is the Kyoto Protocol?

The Kyoto Protocol is an international agreement that aimed to reduce carbon dioxide (CO2) emissions and the presence of greenhouse gases (GHG) in the atmosphere. The essential tenet of the Kyoto Protocol was that industrialized nations needed to lessen the amount of their CO2 emissions. The protocol was adopted in Kyoto, Japan in 1997, when greenhouse gases were rapidly threatening our climate, life on the earth, and the planet, itself.

What Is the Paris Climate Accord?

The Paris Climate Accord is an agreement among the leaders of over 180 countries to reduce greenhouse gas emissions and limit the global temperature increase to below 2 degrees Celsius (3.6 Fahrenheit) above pre-industrial levels by the year 2100. Ideally, the agreement aims to keep the increases to below 1.5 degrees Celsius (2.7 Fahrenheit). On Jan. 20, 2021, President Joe Biden signed an executive order announcing that the U.S. would rejoin the Paris Agreement after the Trump administration withdrew from it on Nov. 4, 2020.

What Is Being Done to Encourage the Use of Renewable Resources?

There are many incentives designed to encourage the use of alternative energy. For example, energy taxes place a surcharge on fossil fuels so that the prices of renewable resources are more competitive and people will be more inclined to use renewable energy. Green funds, investment vehicles such as mutual funds, support eco-friendly and sustainable companies by investing in them and helping to promote environmental awareness.