The REI is a way of measuring the green credentials of any 'renewable' energy scheme. We define it as the number of similar devices one device could manufacture from its energy output.
For example, if a wind turbine manufacturing facility were powered by wind turbines (and all sourced materials were
mined and processed with wind power), then how many wind turbines could each wind turbine make during its lifespan ?
This would be the Renewable Energy Index.
If any technology could not replace itself within its own lifespan i.e. an REI less than 1.0, then obviously its not a renewable energy source as it never catches up with the energy cost of manufacturing the first unit.
If the REI is greater than 1.0, then the technology is promising, but to really qualify as renewable, the energy it cost to build a manufacturing facility aka factory would also need to be covered.
As a more concrete example, lets look at solar panels. We want to know whether the electricity they give out is actually enough to manufacture more solar panels or if the REI is less than 1.0 and they are actually a waste of time.
1. Energy estimate of solar cell manufacture.
The cheaper end of the spectrum cost $50 for a 200 watt panel measuring 1.35 x 1.0 metres. Based on a wholesale energy cost of $25 per megawatt hour, that would imply the energy cost of manufacture of a 200 watt panel is 2 Megawatt hours or if we divide by the area we get 1.5 megawatt hours per metre squared.
You could argue thats too much energy, but it doesn't include the inverters and the energy it cost to make the van for the guy to come deliver them etc.
2. Energy return of a solar panel
This is where things get a bit weird. The wattage rating of the solar panel doesn't matter at all, the only thing important is its efficiency and year total solar insolation at the point of use.
In the UK, yearly total solar insolation is about 1000 kWh/m2 or an average of 114W per metre squared over day and night, summer and winter. Unfortunately, solar panels can only convert 20% of the suns energy into electricty so in the UK, useful solar PV energy is limited to 23 watts per metre squared.
3. Calculation of REI.
We know solar panels cost 1.5 megawatt hours per meter squared to make, how many hours do they need to run to give that energy back ? We get 23 watts from the solar panel per metre squared so -
1500000 / 23 = 65000 hours or 2700 days or 8 years.
This leads to an REI of 32 year lifespan / 8 years = 4
And this is probably an absolute best case for the UK. In reality its probably less than 1.0 when you add up the other energy costs outside the steady state panel production cost e.g. building a factory, shipping, management electronics etc.
So if the return on energy (ROE) is at best 8 years, how does this relate to the return on investment ?
The ROI is going to be less than the ROE as the cost of manufacture is based on current energy prices i.e. heavily levered by the cheap cost of fossil fuels. Often quoted ROIs for solar are 10 years or less (including subsidies), so given that includes a lot of profit at every level, the ROE is likely to be at least double, treble etc of the ROI, which again pushes the ROE example above out to 30 years and the REI perilously close to 1.0.
5. Solar Panels = Green Energy ?
Well if it takes 30 years to get the energy back not counting the factory etc, then no, solar panels are not green or renewable.
If anything, the rush to manufacture billions of dollars worth of solar panels which would never recoup their energy cost while burning a further billion tonnes of coal, could be said if anything to heavily contribute to global warming in the next 30 years.
But hey, if you are going to buy crap that burns oil or coal to make, then solar is just that virtue signalling sector you are looking for.
This idea should really be a serious wake-up call for anybody investing in 'green' technologies which could only possibly be termed 'green' when looking at ROI and definitely not ROE which lags by a factor.
Run the numbers, REI rules out most off-grid / solar PV home energy systems.
Solar PV is only suitable for large commercial ventures with a lot of cheap space and sunlight to push that watts per metre squared well above 50.
Solar water heating systems that are near 100% efficient are a much better use of area in the UK.