Potential Challenges & Problems With Transitioning To Renewable Energy

Renewable energy has grown globally across several metrics in the last few decades.

With this being the case, we’ve identified and explained what might be some of the main challenges and problems that come with either transitioning to, or simply using more renewable energy in an energy system or electricity grid.


Summary – Potential Challenges & Problems With Transitioning To Renewable Energy

Short Term vs Long Term Challenges & Problems

Firstly, it might be worth noting that challenges and problems might be either:

– Shorter term/temporary problems

Particularly if energy systems can be modified or adjusted to deal with new energy sources, or, if there’s technological improvements and developments in things such as performance (like efficiency) and cost of renewable energy sources


– Longer term/more permanent problems

These problems might be harder to fully address


Different Types Of Renewable Energy

The type of renewable energy also matters.

Different renewable energy sources may have different problems and challenges to one another.

For example, solar and wind (being variable energy sources) may have different challenges to geothermal and hydro energy in some ways.


List Of Potential Challenges & Problems

A list of generalised challenges and problems that might arise when transitioning to, or simply using more renewable energy might include:


Impact On Industries Of Other Energy Sources

Existing Infrastructure

Reliance On Government Support

Decentralization, & Siting & Transmission


Grid Stability

Other Energy Sources May Outperform Renewables Across Several Indicators

Impact On Electricity Prices

Impact On A Free Or Competitive Market

Penetration Of Renewables Into Transport, & Also Heating & Cooling, Is Lagging Behind The Electricity Generation Industry

Entering, & Also Competing In The Energy Market

Reliability Misconceptions

Political, Social & Cultural, & Institutional Challenges

Environmental & Sustainability Issues 

Other Challenges & Problems 


How To Transition To, Or Use More Renewable Energy In The Future

The guide below precedes a separate guide we put together on potential strategies for transitioning towards, or using more renewable energy in the future.


Onto the potential challenges …



On one hand, renewable energy may have a positive cost impact in some ways.

For example:

Across some metrics, some renewable energy sources may be cheaper than some fossil fuel energy sources

This might particularly be the case when comparing some renewable energy sources to newer fossil fuel power plants that are designed or fitted with technology to manage air pollution or carbon emissions (such as CCS systems, or clean coal technology)

This new technology may help address some of the potential externalised environmental and sustainability cost that hasn’t been priced into the upfront cost of fossil fuels over the years


– The upfront cost of some renewable energy setups and projects may average out over the lifespan of the project, and lead to a lower lifecycle cost


– Some renewable energy sources may continue to get cheaper in the future 

As factors like economies of scale, technology improvements, and other factors potentially have an impact


– Some reports indicate that replacing existing fossil fuel power plants is more costly than building new ‘clean energy’ projects in their place

From reneweconomy.com.au:

[In Australia …] The cost to decarbonise the electricity system is lower than the cost of replacing the existing power system [of existing coal fired generation with new coal fired generation] like for like.

[And …] there are costs of not decarbonizing [too]

Three priorities in the future that will require investment will be 1. Reducing emissions 2. Replacing the existing coal fleet and coal mines, and 3. Increasing supply of power stations to reduce risk and increase reliability of electricity supply


On the other hand though, renewable energy may have a negative cost impact in some ways.

For example:

– Research and development costs


– Using renewable energy sources in some electricity grids may have additional costs that some fossil fuels don’t have

A few examples are the potential additional costs when using variable energy sources, such as using energy storage methods (like batteries), and backup energy sources


– The upfront cost to replace fossil fuel energy sources with renewable energy sources (within an electricity grid) may be significant

This may especially be the case where not just power plants are replaced, but new or modified supporting infrastructure and grid design is required

There’s also ongoing costs like maintenance, repairs and upgrades to consider.

Lower income cities and regions of the world in particular may not be able to afford this type of energy transition to renewable energy sources from existing fossil fuel sources

Cities and regions with inadequate financial means or budgets may not be able to afford transitioning either


From wattsupwiththat.com:

… there are estimates that the costs of moving the entire [Unites States] to 100 percent renewable sources would be around $5.7 trillion

… [one brief indicates that …] the idea of getting to 100 percent renewable generation is “nothing more than a myth,” and that attempting to do would be a “catastrophe” …


A question posed for renewable energy systems might be …

What their net cost is over time (so upfront costs have time to average out), and are the benefits that renewable energy offer compared to other energy sources (in particular the potential environmental and sustainability benefits) worth the higher cost (if there is one)?

Factors like subsidies (and other forms of government support), and what support fossil fuels have received through history (over the last hundred years or so) might be worth consideration here.

Some might argue that renewable energy and new energy sources need the same amount of time, investment, support and development as fossil fuels has had throughout history in order to be fairly assessed.


Impact On Industries Of Other Energy Sources

Where power plants are closed down and other energy sources are phased out, this can have an impact on various parties involved in the industries of these energy sources.

Investors, operators, workers, and others may all be affected in different ways

One example is where coal power plants might be phased out too quickly – this can be a sunken/stranded investment for investors

Another example might be some workers not being able to re-skill quickly enough where transitions happen too quickly


Existing Infrastructure

Infrastructure includes things such as power lines, pipelines, storage facilities, and other equipment that generates, transmits and distributes energy.

Existing energy grids and infrastructure may largely be set up for fossil fuels in some places.

Building new infrastructure, or modifying, retrofitting, or upgrading existing infrastructure, may have several challenges.

For example, upgrading the existing power grid, building new transmission lines and interconnectors, building new convertors, and so on – all to support new renewable energy – may be practically difficult, as well as prove cost and time intensive in some instances.

Countries like Australia that are spread out for example may already spend significant money on network and transmission costs, and this may eventually factor into electricity prices.

China may have experienced issues with power loss from installed renewable energy capacity not being integrated properly.

However, some of these issues may be more ‘one time’ issues than ongoing issues.


Reliance On Government Support

Some argue that renewable energy needs government support to function and compete in the market, and to get properly set up, developed and stabilised.

Examples of support might include subsidies, tariffs, levies, tax breaks, tax penalties like carbon tax (on other energy sources), schemes and concessions, credits, and so on. 

This is obviously an expense that ultimately comes from taxpayers, and in some instances, is an additional expense beyond that of other energy sources

There’s also non-financial support to consider, in the form of policies and laws that support renewable energy

Different governments might offer different levels of support for renewables at any one time.

For example, within the US, the different State governments might support different renewable energy sources to different extents over different time periods


Some argue though that the above points aren’t issues because fossil fuels have received subsidies and government support in the past, and still continue to do so


Decentralization, & Siting & Transmission 

Fossil fuel plants tend to be centralized in one place

Renewables like solar and wind on the other hand can be decentralized and spread out.

On one hand, decentralisation can present some benefits (such as providing multiple points of energy generation in the event of disruption from extreme weather or disruptive events)

But, it may also present two potential issues – siting, and transmission:

– Siting

For every piece of land [that] wind and solar occupy, there can be ensuing negotiations, contracts, permits, and community relations, all of which can increase costs and delay or kill projects. (ucsusa.org)


– Transmission

Power needs to get from where it’s produced, to where it ends up being used

To do this, it needs transmission lines and transmission infrastructure

ucsusa.org goes into more detail about the potential time and cost involved with transmission lines

theguardian.com also outlines how a lack transmission lines for wind and solar power have been the biggest challenge so far in increasing capacity in the MidWest in the US

The further power needs to travel though – the greater the cost and time for these lines might be

There may also be challenges involved in building lines over greater distances, or on some types of land

In the past, some of the largest renewable energy projects in China might have been a significant distance from the cities and industrial centres that need energy, and transmission lines are required to carry to power to where it needs to get to



Traditional fossil fuels may provide reasonably consistent or stable power output.

Renewable energy sources like geothermal energy and some types of hydro energy may provide consistent and stable power output too. 

However, renewable energy sources like solar and wind energy are considered variable or intermittent sources of energy – they can generally only generate power when the wind is blowing or the sun is shining.

These leads to a fluctuating power supply.

An intermittent and fluctuating power supply may present several challenges or issues.

A few examples may be:

– General Mismatch Between Energy Supply & Demand

This may be an issue where electricity supply and demand need to be timed with each other within a grid

It may also create uncertainty for those who have to help operate or maintain the grid


– Power Supply Exceeding Demand

Surplus power overload the power grid, and make it more unstable

Overloading the power grid can be referred to as ‘overcapacity’

An oversupply of power may also lead to electricity prices dropping


Germany is one example of a country that has experienced overcapacity as a result of variable solar and wind energy supply (power-technology.com)


– Power Demand Exceeding Supply

Where there is not enough wind or sunlight, wind and solar energy may have issues generating enough power to meet demand for the users of the power grid (and potentially to meet base load, as well as power demand peaks according to some reports)

A power supply deficit is an issue in itself


One way to address this might be with energy storage methods so that energy can be stored in times of surplus, for use later in times of deficit

Examples of energy storage methods are energy storage batteries, or systems like pumped storage hydro

Large battery storage technology may have technological and economic limitations in itself

The bigger the batteries are, and, the more hours of energy they need store, the more costly they might be.

On a commercial or utility scale, they also might only have enough stored energy to last a few hours, or to last for short bursts.

wattsupwiththat.com indicates that ‘Batteries of the size and scope needed for 100-percent renewables are unproven and not cost effective.’

South Australia is an example of a region that got a very large energy storage battery built


Another way to address this might be with backup dispatchable energy sources that can ramp up quickly and be ‘dispatched’ on demand (from grid operators) to fill the supply gap (and meet the market’s needs). They can be turned on and off, and can adjust their power output as required.

They might be required to meet baseload or meet peak demand where variable energy sources can’t

power-technology.com (paraphrased) indicates that back-up sources are usually natural gas or coal (and less so nuclear)

power-technology.com also notes that ‘In Germany, having fossil fuel back up energy sources has actually lead to an increase in greenhouse gas emissions over the short term.’


– Other Energy Sources Having To Run At Partial Capacity

Where renewables are providing surplus energy, operators of other energy sources may have to reduce supply to the grid, or turn off supply – there may be economic drawbacks for operators in this case


– Other Information On Variability

From wattsupwiththat.com:

Intermittent wind and solar cannot stand on their own … They must have some form of back-up power, from reliable coal, natural gas, nuclear units, storage capability from hydroelectric facilities, and/or batteries. 


– *Addressing Variability

It is worth noting that a range of reports indicate that variability in renewable energy sources can be addressed in various ways


Grid Stability

Related to the above point, a fluctuating power supply can overload a grid, but also send inconsistent power through that grid.

Where a grid is not designed to deal with these power load fluctuation or peak loads, it’s stability may be impacted.


Countries like Poland and the Czech Republic have suffered grid stability issues from the transmission of surplus energy from the German power grid [which uses renewables] (power-technology.com)


Other Energy Sources May Outperform Renewables Across Several Indicators

As just one example, fossil fuels and nuclear may have much better power density/energy density than most renewables.

These separate guides mention power density, and other go into more detail about different ways to measure different energy sources:

Renewable Energy vs Fossil Fuels vs Nuclear: A Comparison

Which Energy Source Is The ‘Best’?


Impact On Electricity Prices

Some reports indicate that renewables impact electricity prices via either increased electricity prices, or, general volatility in electricity prices.

There may be a roll on effect with volatile electricity prices, with some power suppliers having to pay to offload their surplus electricity

Having said this, there are reports that indicate that electricity price volatility can be managed, and also that renewables may positively impact electricity prices in some places too.

Ultimately, each individual country or region might have different factors impacting their electricity prices, and they might each have different renewable energy related factors impacting electricity prices too.


Potential Negative Impact On Electricity Prices, & On Power Suppliers

From power-technology.com:

Germany has experienced volatility of electricity prices when there has been a surplus of solar and wind [electricity] …

[This] has forced prices negative in the past, forcing power plants to pay commercial customers to receive the surplus


When existing energy sources, such as fossil fuels, are phased out of the market too quickly, there might be a supply deficit, and this can increase electricity prices.


Why Renewables May Not Impact Electricity Prices As Significant As Some Reports Indicate

power-technology.com might indicate that Germany has somewhat addressed volatile electricity prices:

‘[Volatile electricity prices] can be somewhat addressed by replacing the feed-in tariff subsidy with a market-responsive auction system based on pre-set RES capacity growth caps …


… wind and solar energy in South Australia has actually made the market for wholesale electricity prices more competitive with natural gas – leading to cheaper prices … (abc.net.au)


Impact On A Free Or Competitive Market

Regulations and government tools used for renewables might impact or interfere with a free or competitive market in several ways.

One example of one of these tools is renewable energy portfolios

They may stipulate a minimum amount of renewable energy to be used in an energy mix, that renewables be used first (or as a priority), and that the output of other energy sources are capped to a certain amount.

Where other energy sources have to be capped or turned off, and aren’t running at full capacity, this may impact the economic feasibility of running these energy sources 

Other better performing or cost efficient forms of energy can also be forced out of the market even if they are more competitive (because of market control tools)


Having said this, some might point out that fossil fuels have had similar artificial support in the market in the past


Penetration Into Transport, & Also Heating & Cooling Is Currently Lagging The Electricity Generation Industry

Right now, renewable energy might have only significantly penetrated into the electricity generation industry.

Penetration of renewable energy (in terms of % share of total energy) into transport, and also heating and cooling, might be lagging far behind electricity generation.


Entering, & Also Competing In The Energy Market

– Entering The Market

There may be issues for renewable energy entering the energy market in some places because of how established existing energy sources like fossil fuels already are, and the advantages that come along with that foothold.


The existing energy market in countries like the US is set up for fossil fuels and existing established energy sources, and these energy sources benefit from existing infrastructure, expertise, and policy (ucsusa.org).


– Competing In The Market

Even if renewables can enter into the market, there may also be various factors that make it difficult for renewables to compete against existing energy sources.


Some argue in countries like the US, fossil fuels benefit from political influence, and receive direct subsidies (through subsidies, tax breaks, and other incentives and loopholes, and indirect subsidies (through not being punished for polluting for example) (ucsusa.org) 


Coal and other fossil fuel energy sources may also be more profitable in some countries, and mining companies, investors, and other parties (even decision makers like politicians) may be incentivised by this.


Reliability Misconceptions

Because of the variability of wind and solar, some people may think that these energy sources are completely unreliable.

But, there may be some reliability misconceptions about solar and wind energy.


Political, Social & Cultural, & Institutional Challenges

Some reports indicate that some challenges with transitioning to renewables aren’t technological or economic 

Instead, they might be political, social & cultural, or institutional. 

Examples might include:

– Political 

Some political parties or political figures may have interests in promoting or using other energy sources


– Social & Cultural

Some cultures or societies may be opposed to some aspects of renewable energy

A certain % of society may also have interests in fossil fuel industries – for employment/income, affordable electricity, and so on


– Institutional

Overall, the energy sector and the institutions that impact it may be set up primarily for fossil fuels


Environmental & Sustainability Issues

We wrote more about the potential sustainability issues of renewable energy in a separate guide.

Some reports also indicate that a large scale renewable energy transition can involve the unsustainable use of raw materials, and still requires some fossil fuels.


Other Potential Problems & Challenges

Might include: 

– Scaling

Some question whether renewable energy systems can scale up fast enough, or can get to a certain scale by a certain target year


– Scarcity Of Resources Used In Some Renewable Technology

Like for example some precious metals used for some renewable energy equipment and batteries

Nickel, cobalt, copper, and lithium may be some examples of metals


– Other Practical Limitations

For example:

Adding turbines to some existing hydropower dams (for increased capacity) may be physically impossible

Some countries or cities may not have the physical resources for some renewables – such as adequate sunlight, adequate wind, and so on. Australia for example may have more sunshine and land in some regions than other parts of the world do.

Large renewable energy projects, like large hydro power mega dam projects, can have feasibility issues at the design and approval stage


– Potential Disagreements Over The Capability Of Renewable Energy Systems

For example, some engineers may disagree over different load concepts.


Older power engineers are attached to the concepts of base load, intermediate and peak load power stations … and cannot envisage a system that contains a large fraction of variable RElec and where demand can be modified almost instantaneously (reneweconomy.com.au)


– Technical Limitations

From reneweconomy.com.au:

[There is] The need for frequency control and the provision of inertia, price signaling and communication between distributors and the wholesale electricity market 


– Some Countries Depend On Cheap Fossil Fuels For Economic Reasons

They are a cheap source of energy with a high power density, and may be good for economic growth (where economic growth is a priority)


– Existing Energy System Can Be A Result Of The Last 15 Years Of Energy Sector Strategy

And, there’s a lag between between the development of strategy, and implementation


– Environmental Laws & Regulations May Be Too Lax In Some Countries

For dirtier energy sources 


– Fines & Penalties May Be Cheaper To Pay For Dirtier Energy Sources

Compared to lost profits of discontinuing environmentally damaging practices


– Some Small Populations/Communities Are Reliant/Dependent On Fossil Fuels For Their Livelihood

Like mining towns for example


Challenges & Issues Differ Between Cities & Countries

Ultimately, every city and country has a different local energy system and energy mix.

So, each city and country may have different challenges and problems in using renewable energy as part of their energy mix.

Germany, South Australia and California are three examples of places that may have had different problems with their transition to renewable energy.


Other Guides With Information On The Challenges & Problems With Using Renewable Energy

Some of the guides that list further challenges and problems are:

Can Renewable Energy Replace Fossil Fuels, Meet Demand, & Power The World? (Moving Towards 100% Renewable Energy)

The Challenges With China’s Transition From Coal, To Natural Gas & Renewable Energy

Potential Issues Experienced By Germany In Their Energy Transition

Considerations When Choosing Different Energy Sources In The Future (Social, Environmental, Economic, Practical & More)


Other Relevant Guides

The following guides may also be relevant to points discussed above:

Renewable Energy vs Fossil Fuels vs Nuclear: Comparison Guide

Pros & Cons Of Renewable Energy

Pros & Cons Of Fossil Fuel Energy





1. Various ‘Better Meets Reality’ guides

2. https://www.power-technology.com/features/featureovercapacity-and-the-challenges-of-going-100-renewable-5872868/

3. https://www.ucsusa.org/clean-energy/renewable-energy/barriers-to-renewable-energy

4. https://www.abc.net.au/news/2018-12-07/study-shows-impact-wind-solar-gas-power-on-electricity-prices/10590876

5. https://en.wikipedia.org/wiki/Dispatchable_generation

6. https://www.swecourbaninsight.com/urban-energy/the-limits-to-renewable-energy/

7. https://interestingengineering.com/is-mark-jacobsons-plan-to-use-100-renewable-energy-feasible

8. https://wattsupwiththat.com/2019/05/02/researchers-say-renewable-energy-mandates-cause-large-electricity-price-increases/

9. https://reneweconomy.com.au/does-more-renewable-energy-mean-higher-prices-10310/

10. https://www.theguardian.com/environment/2023/feb/26/red-states-lead-usa-renewable-energy-wind-solar-power

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