Prior to the development of coal in the mid 19th century, nearly all energy used was renewable. Almost without a doubt the oldest known use of renewable energy, in the form of traditional biomass to fuel fires, dates from 790,000 years ago. Use of biomass for fire did not become commonplace until many hundreds of thousands of years later, sometime between 200,000 and 400,000 years ago. Probably the second oldest usage of renewable energy is harnessing the wind in order to drive ships over water. This practice can be traced back some 7000 years, to ships in the Persian Gulf and on the Nile. Moving into the time of recorded history, the primary sources of traditional renewable energy were human labor, animal power, water power, wind, in grain crushing windmills, and firewood, a traditional biomass. A graph of energy use in the United States up until 1900 shows oil and natural gas with about the same importance in 1900 as wind and solar played in 2010.
On most horizontal wind turbine farms, a spacing of about 6–10 times the rotor diameter is often upheld. However, for large wind farms distances of about 15 rotor diameters should be more economical, taking into account typical wind turbine and land costs. This conclusion has been reached by research conducted by Charles Meneveau of the Johns Hopkins University, and Johan Meyers of Leuven University in Belgium, based on computer simulations that take into account the detailed interactions among wind turbines (wakes) as well as with the entire turbulent atmospheric boundary layer.
A 2014-published life-cycle analysis of land use for various sources of electricity concluded that the large-scale implementation of solar and wind potentially reduces pollution-related environmental impacts. The study found that the land-use footprint, given in square meter-years per megawatt-hour (m2a/MWh), was lowest for wind, natural gas and rooftop PV, with 0.26, 0.49 and 0.59, respectively, and followed by utility-scale solar PV with 7.9. For CSP, the footprint was 9 and 14, using parabolic troughs and solar towers, respectively. The largest footprint had coal-fired power plants with 18 m2a/MWh.
In its 2014 edition of the Technology Roadmap: Solar Photovoltaic Energy report, the International Energy Agency (IEA) published prices for residential, commercial and utility-scale PV systems for eight major markets as of 2013 (see table below). However, DOE's SunShot Initiative has reported much lower U.S. installation prices. In 2014, prices continued to decline. The SunShot Initiative modeled U.S. system prices to be in the range of $1.80 to $3.29 per watt. Other sources identify similar price ranges of $1.70 to $3.50 for the different market segments in the U.S., and in the highly penetrated German market, prices for residential and small commercial rooftop systems of up to 100 kW declined to $1.36 per watt (€1.24/W) by the end of 2014. In 2015, Deutsche Bank estimated costs for small residential rooftop systems in the U.S. around $2.90 per watt. Costs for utility-scale systems in China and India were estimated as low as $1.00 per watt.
The PV industry is beginning to adopt levelized cost of electricity (LCOE) as the unit of cost. The electrical energy generated is sold in units of kilowatt-hours (kWh). As a rule of thumb, and depending on the local insolation, 1 watt-peak of installed solar PV capacity generates about 1 to 2 kWh of electricity per year. This corresponds to a capacity factor of around 10–20%. The product of the local cost of electricity and the insolation determines the break even point for solar power. The International Conference on Solar Photovoltaic Investments, organized by EPIA, has estimated that PV systems will pay back their investors in 8 to 12 years. As a result, since 2006 it has been economical for investors to install photovoltaics for free in return for a long term power purchase agreement. Fifty percent of commercial systems in the United States were installed in this manner in 2007 and over 90% by 2009.
The theory of peak oil was published in 1956. In the 1970s environmentalists promoted the development of renewable energy both as a replacement for the eventual depletion of oil, as well as for an escape from dependence on oil, and the first electricity generating wind turbines appeared. Solar had long been used for heating and cooling, but solar panels were too costly to build solar farms until 1980.
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There is no energy in the wind at those wind speeds, nothing to harvest for the turbine. While it may make you feel good to see your expensive yard toy spin, it is not doing anything meaningful in a breeze like that: To give you some idea, a wind turbine with a diameter of 6 meters (pretty large as small wind turbines go) can realistically produce just 120 Watt at 3.5 m/s wind speed. That same turbine would be rated at 6 kW (or more, see the next section), so energy production at cut-in really is just a drop in the bucket. What is more, due to the way grid-tie inverters work, you are about as likely to be loosing energy around cut-in wind speed to keep the inverter powered, as you are in making any energy, resulting in a net-loss of electricity production.
Those not satisfied with the third-party grid approach to green energy via the power grid can install their own locally based renewable energy system. Renewable energy electrical systems from solar to wind to even local hydro-power in some cases, are some of the many types of renewable energy systems available locally. Additionally, for those interested in heating and cooling their dwelling via renewable energy, geothermal heat pump systems that tap the constant temperature of the earth, which is around 7 to 15 degrees Celsius a few feet underground and increases dramatically at greater depths, are an option over conventional natural gas and petroleum-fueled heat approaches. Also, in geographic locations where the Earth's Crust is especially thin, or near volcanoes (as is the case in Iceland) there exists the potential to generate even more electricity than would be possible at other sites, thanks to a more significant temperature gradient at these locales.
As of 2014, offshore wind power amounted to 8,771 megawatt of global installed capacity. Although offshore capacity doubled within three years (from 4,117 MW in 2011), it accounted for only 2.3% of the total wind power capacity. The United Kingdom is the undisputed leader of offshore power with half of the world's installed capacity ahead of Denmark, Germany, Belgium and China.
Usually however, renewable energy is derived from the mains electricity grid. This means that energy storage is mostly not used, as the mains electricity grid is organised to produce the exact amount of energy being consumed at that particular moment. Energy production on the mains electricity grid is always set up as a combination of (large-scale) renewable energy plants, as well as other power plants as fossil-fuel power plants and nuclear power. This combination however, which is essential for this type of energy supply (as e.g. wind turbines, solar power plants etc.) can only produce when the wind blows and the sun shines. This is also one of the main drawbacks of the system as fossil fuel powerplants are polluting and are a main cause of global warming (nuclear power being an exception). Although fossil fuel power plants too can be made emissionless (through carbon capture and storage), as well as renewable (if the plants are converted to e.g. biomass) the best solution is still to phase out the latter power plants over time. Nuclear power plants too can be more or less eliminated from their problem of nuclear waste through the use of nuclear reprocessing and newer plants as fast breeder and nuclear fusion plants.
Solar power panels that use nanotechnology, which can create circuits out of individual silicon molecules, may cost half as much as traditional photovoltaic cells, according to executives and investors involved in developing the products. Nanosolar has secured more than $100 million from investors to build a factory for nanotechnology thin-film solar panels. The company's plant has a planned production capacity of 430 megawatts peak power of solar cells per year. Commercial production started and first panels have been shipped to customers in late 2007.
Subsequently, Spain, Italy, Greece—that enjoyed an early success with domestic solar-thermal installations for hot water needs—and France introduced feed-in tariffs. None have replicated the programmed decrease of FIT in new contracts though, making the German incentive relatively less and less attractive compared to other countries. The French and Greek FIT offer a high premium (EUR 0.55/kWh) for building integrated systems. California, Greece, France and Italy have 30–50% more insolation than Germany making them financially more attractive. The Greek domestic "solar roof" programme (adopted in June 2009 for installations up to 10 kW) has internal rates of return of 10–15% at current commercial installation costs, which, furthermore, is tax free.
Small wind turbines may be used for a variety of applications including on- or off-grid residences, telecom towers, offshore platforms, rural schools and clinics, remote monitoring and other purposes that require energy where there is no electric grid, or where the grid is unstable. Small wind turbines may be as small as a fifty-watt generator for boat or caravan use. Hybrid solar and wind powered units are increasingly being used for traffic signage, particularly in rural locations, as they avoid the need to lay long cables from the nearest mains connection point. The U.S. Department of Energy's National Renewable Energy Laboratory (NREL) defines small wind turbines as those smaller than or equal to 100 kilowatts. Small units often have direct drive generators, direct current output, aeroelastic blades, lifetime bearings and use a vane to point into the wind.
The early development of solar technologies starting in the 1860s was driven by an expectation that coal would soon become scarce. Charles Fritts installed the world's first rooftop photovoltaic solar array, using 1%-efficient selenium cells, on a New York City roof in 1884. However, development of solar technologies stagnated in the early 20th century in the face of the increasing availability, economy, and utility of coal and petroleum. In 1974 it was estimated that only six private homes in all of North America were entirely heated or cooled by functional solar power systems. The 1973 oil embargo and 1979 energy crisis caused a reorganization of energy policies around the world and brought renewed attention to developing solar technologies. Deployment strategies focused on incentive programs such as the Federal Photovoltaic Utilization Program in the US and the Sunshine Program in Japan. Other efforts included the formation of research facilities in the United States (SERI, now NREL), Japan (NEDO), and Germany (Fraunhofer–ISE). Between 1970 and 1983 installations of photovoltaic systems grew rapidly, but falling oil prices in the early 1980s moderated the growth of photovoltaics from 1984 to 1996.