Alternative Energy Tax Credits - Green Energy Cost Savings

Alternative energy sources encompass solar PV, wind, hydroelectric, and geothermal generation, leveraging power electronics, inverters, HVDC, storage, and smart grid integration to deliver efficient, low-carbon electricity and resilient microgrids and stable operation.

What Are Alternative Energy Sources?

Technologies that convert renewables to electricity using power electronics, storage, and advanced grid control.

✅ Includes solar PV, wind turbines, hydroelectric, and geothermal

✅ Uses inverters, MPPT, converters, HVDC, and protection relays

✅ Integrates storage, microgrids, smart grid controls, and V2G

Are there other alternative energy sources besides renewables? There are other alternative energy sources that are used instead of conventional energy sources, such as oil and coal, that produce (or hardly produce) greenhouse gas emissions (GHG) that are harmful for the environment. For a broader definition of the term, see this overview at what is alternative energy to understand key concepts.

Alternative Energy Sources – Nuclear Energy

Nuclear energy is one of the few alternative energy sources that can generate a lot of electricity from very little fuel, which makes it a very abundant energy source. Nuclear energy is generated when atoms are either split (fission) or merged (fusion) to create energy from the reaction. It’s a clean energy because, unlike coal or oil, nuclear energy doesn’t introduce harmful gases, such as carbon dioxide, into the environment. However, nuclear energy becomes harmful during the production stage. The leftover waste is highly radioactive (unstable continuously decaying elements with high-energy particles or rays that penetrate and damage anything that it touches), which makes it hard to contain. Nuclear waste has to be stored in a secure location until alternative containing options are determined. Nuclear energy is used to generate electricity, launch space ships, and to power weapons. Comparative context across non-fossil options is outlined in forms of alternative energy for additional perspective.

For contrast with resources that naturally replenish, explore renewable energy sources to see how they differ in fuel cycles and emissions profiles.

Alternative Energy Sources – Natural Gas

Natural gas is considered a nonrenewable fossil fuel, but it’s considered clean because it doesn’t produce the greenhouse gas, carbon dioxide. Natural gas’s main ingredient is methane, with all other core elements filtered through an extensive filtering process. Advantages of natural gas include its global abundance, low cost and ease of use (natural gas plants can come online very quickly). However, isolating methane is quite a complex process, which makes it a disadvantage. And, even though natural gas doesn’t introduce carbons into the air, it still produces greenhouse gases. Natural gas can also be used to make electricity. Energy industry experts believe that natural gas will have a bigger role in electricity production as future demand for electricity increases. Within the broader mix of alternative energy fuels, natural gas is often positioned as a transitional option.

Grid planners evaluate flexible generation, storage, and demand-side measures among various alternative energy solutions to integrate resources efficiently.

Alternative Energy Sources – Hydrogen Fuel

Hydrogen hasn’t become a money-making venture, unlike other alternative energy sources, because the energy return on hydrogen isn’t very high. In other words, more energy is needed during the manufacturing process than the amount of hydrogen that is actually produced. At this point, hydrogen has proven to be an environment-friendly fuel source for vehicles. Hydrogen fuel is used mostly in batteries, by combining oxygen and hydrogen to produce power. The only waste factor is water vapor, which is a lot friendlier than the greenhouse gas, carbon dioxide. Ultimately, advancements in technology are required in hydrogen production in order for this form of alternative energy to become profitable. Renewable electricity from sources such as solar power can drive electrolysis to lower hydrogen's lifecycle emissions.

For a strategic view of how renewables complement low-carbon options, review renewable alternative energy to understand deployment pathways and tradeoffs.

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Alternative energy fuels drive renewable power systems, integrating hydrogen, biofuels, and electricity with power electronics, smart grids, and energy storage for efficient conversion, decarbonization, and resilient distribution across modern electrical networks.

What Are Alternative Energy Fuels?

Alternative energy fuels are renewables—hydrogen, biofuels, electricity—supporting conversion and smart grid integration

✅ Power electronics convert DC/AC and manage grid-tied renewables.

✅ Fuel cells and hydrogen storage integrate with microgrids.

✅ Battery systems and EMS stabilize variable solar and wind.

Alternative energy fuels can help reduce harmful greenhouse gas emissions produced from traditional gasoline or diesel fuels. Using alternative energy fuels means that you might have to change your conventional vehicle in for a more environmentally-friendly ride. Is this true? Let's find out. To start, a quick primer on what alternative energy is can clarify terms and set expectations in practical terms.

Alternative Energy Fuels - Battery-electric Vehicles

Your first option is battery-electric vehicles (BEVs), which powered by motors that draw electricity from on-board storage batteries. These batteries act as an engine to propel the motor. Using electric vehicles presents a great potential to reduce greenhouse gas (GHG) emissions and smog-forming pollutants because pollution isn't produced from the tailpipe or through fuel evaporation. The vehicles can also have low overall (life-cycle) GHG emissions depending on the electricity source used to recharge the batteries. This option would require you to say goodbye to your conventional vehicle. When charged from renewable energy sources, BEVs can further minimize lifecycle emissions and operating costs.

Alternative Energy Fuels - Hybrid-electric Vehicles

If you don't necessarily want to give up your conventional vehicle, but still want the environmental and energy benefits of electric vehicles, then hybrid electric vehicles (HEVs) are your best option. HEVs are made up of a battery powered electric motor with combined with a conventional internal combustion engine. Instead of paying outrageous gas prices every time your gas tank nears the empty mark, a rapid refueling option recharges your conventional vehicle. If this alternative energy fuel option appeals to you then you'll be glad to know that many hybrid vehicle models are already widely available on the market, with many more manufacturers planning on introducing new hybrid electric/gasoline vehicles in the next few years. Many buyers also view HEVs as pragmatic alternative energy solutions that ease the transition away from full reliance on gasoline.

Alternative Energy Fuels - Fuel Cells and Hydrogen

If you are using a portable or a stationary power device, then fuel cells might be the ideal option for you. Electricity is generated in fuel cells electrochemically when hydrogen and oxygen are combined. Fuel Cells can produce zero or very low emissions depending on the source of the hydrogen. These energy-conversion devices can also utilize hydrogen and other fuels and, in the future, might be used for transportation applications. This alternative energy fuel source is also an option for vehicles and prototypes for hydrogen fuel cell vehicles that are currently in the works. But, unfortunately, barriers exist. A lack of a hydrogen distribution infrastructure has made it difficult for this alternative energy fuel source to move ahead. Also, costs are high for fuel cells and hydrogen-production technologies and there are challenges related to hydrogen storage. However, fuel cells are a viable energy technology that can offer significant environmental, supply, economic and energy efficiency benefits because of the variety of fuels available for conversion to hydrogen. This pathway fits within the spectrum of alternative energy sources, each with distinct infrastructure and cost considerations.

For a broader perspective on where hydrogen, electricity, and fuels like bioenergy fit, explore the major forms of alternative energy and how they complement one another across sectors.

Alternative Energy Fuels - Ethanol

When scientist Dr. Emmett "Doc" Brown used food to add fuel to his gas tank in the famous ‘80s flick, Back To The Future 2, he must have been thinking of ethanol, a liquid alcohol made of oxygen, hydrogen and carbon obtained from the fermentation of sugar or converted starch contained in grains and other agricultural or agri-forest feedstocks. Using fuel ethanol (or gasohol, which means that the alternative energy fuel source is distilled and dehydrated to create a high-octane, water-free alcohol) might one day be a viable alternative energy fuel source. However, oral consumption is unadvised because this alternative energy fuel is made unfit for drinking when a small amount of a noxious substance such as gasoline is added. In order for fuel ethanol to work as an effective alternative energy fuel source, all traces of water must be removed because water and alcohol combined cannot dissolve in gasoline. Further research into technology to produce ethanol from non-food sources is quickly moving this alternative energy fuel source toward commercialization. Because many feedstocks derive from crops and residues, ethanol often intersects with biomass energy pathways and agricultural policy.

Alternative Energy Fuels - Biodiesel

Conventional diesel combustion harms the environment, but biodiesel combusts better with a higher cetane rating that produces fewer life cycle greenhouse gas emissions (GHG). This alternative energy fuel source is a non-toxic and biodegradable fuel that comes from vegetable oils, animal fats, waste cooking oil, or tall oil (a by-product from pulp and paper processing). Biodiesel is made from these feedstocks through transesterification, a process that reacts the oil with an alcohol (methanol is usually used, but so can ethanol) and a catalyst (eg. sodium hydroxide). Glycerine, an ester called biodiesel, is produced from this chemical reaction. Most biodiesel is generated using this method. In practice, successful biodiesel programs are often part of broader renewable alternative energy strategies that leverage regional feedstocks and local distribution.

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Alternative energy incentives accelerate grid decarbonization via tax credits, rebates, net metering, and grants for solar, wind, storage, power electronics, microgrids, and smart grid upgrades, reducing LCOE and supporting EV charging infrastructure.

What Are Alternative Energy Incentives?

Incentives—tax credits, rebates, net metering—finance clean electrification, grid upgrades, and storage to cut costs.

✅ Lowers LCOE for solar PV, wind, and battery storage projects

✅ Supports grid modernization, smart inverters, and microgrid controls

✅ Enables EV charging, demand response, and power electronics R&D

Alternative energy incentives encourage companies to pursue non-fossil-fuel energy as a way to consume power. Different countries have different alternative energy incentive programs available for businesses and residences through country, state/province, or municipality levels. However, in this article, alternative energy incentives for business take the center focus. For background on definitions and technologies, see this overview of what constitutes alternative energy and typical market drivers.

In the U.S., two alternative energy incentives available are the investment tax credit and the production tax credit (both can be claimed on a taxpayer’s federal income tax return). A third incentive is a grant program that gives businesses opportunities to receive cash payments from the government for purchasing alternative energy property. Detailed federal and state guidance on credits is summarized in this resource on renewable energy tax credits for common project types.

The investment tax credit, the energy production tax credit or the federal energy grant cannot be claimed in tandem, meaning that a taxpayer can only choose one of these alternative energy incentives. Obviously care will need to be taken in deciding which alternative energy incentive will be best for a specific taxpayer.

Many businesses model total installed cost and depreciation using these alternative energy cost references before selecting an incentive.

While incentives are available They are available for both businesses and individuals; and they can be found at the federal, state and local levels, as well as with utility companies and product manufacturers. A concise primer on renewable alternative energy helps stakeholders align technologies with applicable programs.

1. Alternative Energy Incentives - Investment Tax Credit

A taxpayer can claim a tax credit equal to thirty percent of the cost of qualified eligible energy property placed in service. For credit calculations and eligibility nuances, consult this guide to alternative energy tax credits and common compliance pitfalls.

Property eligible for this alternative energy incentive are:

• Solar property,
• Geothermal property,
• Qualified fuel cell property,
• Stationary micro turbine property,
• Combined heat and power system property,
• Qualified small wind energy property, and
• Geothermal heat pump property

  The federal tax credit is not considered to be taxable income; however, the cost basis of the energy property will need to be reduced by one-half of energy credit claimed. The investment tax credit is also subject to an alternative minimum tax limitation. The credit cannot reduce a taxpayer’s regular tax below the taxpayer’s alternative minimum tax. Any unused credit can be carried back one year and forward twenty years. Case studies of successful deployments in solar, CHP, and wind are profiled among these alternative energy projects to illustrate basis and credit interactions.

  A percentage of the investment tax credit will have to be recaptured if the energy property is disposed of within five years of being placed in service.

2. Alternative Energy Incentives - Production Tax Credit

A taxpayer can claim a tax credit equal to a percentage (between .0075 cents and 2.1 cents per kilowatt hour) of energy generated from qualified energy resource property placed in service. The credit can be claimed for a ten year period starting with the date that the energy resource property is placed in service.

Eligible energy resources for this alternative energy incentive include:

• Geothermal or solar energy,
• Wind,
• Open-loop biomass,
• Closed-loop biomass,
• Marine and hydrokinetic renewable energy

   

• Small irrigation power,
• Qualified hydropower production, and,
• Municipal solid waste

  Unlike the investment tax credit, the cost basis of energy property does not have to be reduced by the production tax credit claimed. In addition, for facilities that generate electricity, there is no alternative minimum tax credit limitation for the first four years that a facility is placed in service.

  Similar to the investment tax credit, an unused energy credit can be carried back one year and forward twenty years.

3. Alternative Energy Incentives - Grant For Specific Energy Project Investments

This grant program offers cash payments to eligible taxpayers who place in service specific energy properties. Only taxpayers that are in a trade or business can qualify for this grant, which means that a residential energy-efficient property does not qualify. Application procedures and deadlines are outlined in these alternative energy grant resources for business applicants.

The grant is in lieu of the aforementioned alternative energy incentives, meaning that a taxpayer can apply for the grant or claim one of the business tax credits, but not both.

The following persons are not eligible to receive payment:

• Federal, state or local governments,
• Non-profit organizations,
• Cooperative electric companies.

   

  Property eligible for this alternative energy incentive are:

• Solar property,
• Geothermal property,
• Qualified fuel cell property,
• Stationary micro turbine property,
• Combined heat and power system property,
• Qualified small wind energy property, and
• Geothermal heat pump property

   

The cost basis on which the payment is based upon is its original cost and, which includes all costs. These costs, such as installation and cost of freight, are part of property’s depreciable basis.

The investment tax credit, which is similar to the above alternative energy incentive, the cost basis of the energy property has to be reduced by fifty percent of the grant received. In addition, to the extent that specified energy property is disposed of within five years of being placed in service a percentage of the grant will need to be recaptured.

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Alternative Energy Solar Power converts sunlight via photovoltaics into electricity using PV modules, inverters, MPPT, and battery storage for grid-tied systems, microgrids, and off-grid resilience, improving efficiency, reliability, and decarbonization.

What Is Alternative Energy Solar Power?

A renewable electrical system converting solar irradiance to AC via PV modules, MPPT inverters, and optional storage.

✅ PV arrays generate DC; power electronics regulate voltage and current.

✅ Inverters with MPPT perform DC–AC conversion, grid sync, and protection.

✅ Battery storage and EMS enable peak shaving, backup, and microgrid control.

Alternative energy solar power is, perhaps, the first energy source that comes to mind when most people think of alternative energy sources, but — unlike wind — alternative energy solar power is still a long way from being considered a mainstream source of electricity generation. In fact, it accounts for less than one per cent of the world’s electricity production. For readers new to the topic, what is alternative energy clarifies key definitions and the role solar plays among emerging options.

Two main ways to harness the sun's energy to generate alternative energy solar power include: photovoltaic (PV), where solar cells directly convert sunlight into electricity, and solar-thermal power. PV is a proven alternative energy solar power technology that is most appropriate for small-scale applications to provide heat and power to individual houses and businesses. Sunlight falls on a layer of semiconductors, which excites electrons. This, in turn, creates an electrical current that can be transmitted via electrical cables to serve useful applications. Alternative energy solar power solar PV cells are already cost effective for powering houses and businesses in some regions. As with alternative energy wind power, costs have reduced in the past few years thanks to technological developments. But, unlike alternative energy wind power, however, large scale electricity production using alternative energy solar power costs about 22 cents per kilowatt-hour, significantly more expensive than its fossil fuel generation competitors and nuclear power. Comparative cost and performance data across technologies are summarized in alternative energy power, which details where PV is most competitive.

Solar-thermal energy is a completely different technology. It collects and concentrates the sun's rays to heat up fuel such glycol or any other liquid that heats up easily. The heat trapped within this medium is then used transferred through a heat exchanger so that heated water can be used for regular hot water applications like bathing and space heating and heating swimming pools, etc. Fossil fuels are sometimes used as a back-up to heat the water in the boiler if the sun is not shining and cannot heat the system. There are three different methods for concentrating the sun’s rays:

• Parabolic Trough — This method uses long, parallel rows of glass mirrors in the shape of a trough to concentrate the sun’s rays directly at the “absorber tube," which is often filled with oil, to achieve maximum effect.
• Power Tower — Similar in principle to parabolic-trough technology, the mirrors are placed in a circular pattern. At the center of the circle is a tower, at the top of which is a receiver filled with water, air, liquid metal or molten salt that moves to a power block and is used to power a steam turbine.
• Parabolic Disk System — In this system, dishes rather than troughs are used to concentrate the power of the sun.

To see how these concentrating approaches integrate with storage, controls, and grid interconnection, alternative energy systems offers design-level guidance for practitioners.

Advantages of Alternative Energy Solar Power

In spite of its cost versus other sources of energy, alternative energy solar power is attracting interest due to the following:

• Alternative energy solar power makes use of a renewable natural resource that is readily available in many parts of the world.
• The process used to generate alternative energy solar power is emission-free.
• Costs have greatly reduced thanks to technological advances in solar power technlogy to a point that it can compete with fossil fuel alternatives in specific circumstances.
• The technology is scalable in that it can be used for domestic heating purposes or on a larger scale for commercial electricity generation, as solar water heaters are an established technology, widely available and simple to install and maintain.

For a deeper dive into real-world performance benefits, case studies in advantages of solar power highlight emissions reductions and lifecycle savings.

Disadvantages of Alternative Energy Solar Power

The biggest barriers to increasing alternative energy solar power generation are the cost, the amount of land required for large-scale electricity production, and the intermittent nature of the energy source. In terms of the latter, thermal systems do not work at night or in inclement weather. Storage of hot water for commercial or domestic use is simple because only insulated tanks are needed, but further technology advancements are required to improve storage for the higher-temperature liquids required to generate electricity on a large scale and storage of the electricity itself. Emerging roadmaps in alternative energy solutions discuss thermal storage media and hybrid configurations that mitigate intermittency challenges.

Outlook for Alternative Energy Solar Power

Although alternative energy wind power is more economical and has been more widely adopted for large-scale power production than solar energy, solar energy is the most flexible in scale and application. It also is widely available and an environmentally benign source of alternative energy. Broader market drivers and renewable policy trends are tracked under renewable alternative energy, providing useful context for long-term solar adoption.

It is currently a $7 billion per year business that is growing at 40 per cent per annum. As part of the wider clean-energy portfolio, the taxonomy in forms of alternative energy situates solar alongside complementary technologies.

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Renewable alternative energy integrates solar PV, wind turbines, hydroelectric and biomass with power electronics, battery storage, smart grids, and grid-tied inverters to deliver sustainable electricity, demand response, and resilient microgrids.

What Is Renewable Alternative Energy?

Renewable alternative energy uses low-carbon sources with power electronics and storage to deliver reliable electricity.

✅ Power electronics: inverters, converters, MPPT for PV and wind

✅ Grid integration: synchronization, frequency control, protection

✅ Energy storage: batteries, BMS, supercapacitors, grid services

What are renewable alternative energy sources? Renewable energy sources, such as solar energy and wind energy, are alternative energy supplies that are refilled by natural processes when they're used. The ultimate source of all renewable energy is the sun. Electricity can be obtained from the sun directly (such as solar heating systems) or indirectly (as in hydro electricity, wind power, and biomass fuels). Renewable energy supplies can run out if they are used faster than they become replenished. For example, most of England's forests were cut down and used for fuel before the English started using coal. Renewable energy supplies have the chance to last forever if used wisely. For fundamentals and current trends, the Electricity Forum explains key renewable energy sources that complement these concepts.

There are other alternatives to our typical energy sources that are not renewable. Although these are "alternative energy" rather than "renewable energy", they use the energy we have more efficiently than older technologies. In doing this, they help us make our existing energy supplies last longer and give us more time before we run out of stored fossil and atomic fuels. However, parallels can be drawn between the two, which can make them interchangeable. Alternative energy sources don't threaten the environment even though they cannot necessarily be renewed. Renewable energy sources are, as we previously mentioned, renew them as fast as we use them. In this article, we focus on the energy sources that can be called both "alternative energy" and "renewable energy." We call them "renewable alternative energy sources." To clarify terminology, this overview of what is alternative energy outlines distinctions commonly used by educators and policymakers.

Using renewable alternative energy sources can save money, protect the environment, and assure future generations of people that efficient energy will be available.

Practical adoption is often driven by proven alternative energy solutions that reduce costs and emissions in real projects.

Here are a few renewable alternative energy sources that are in use today. Broader context on evolving technologies appears in this survey of forms of alternative energy relevant to the categories below.

Renewable Alternative Energy - Hydroelectric power

Hydropower represents one of the oldest and largest renewable power sources (this renewable alternative energy source has an existing capacity of over 80,000 MW). Hydropower plants convert the energy of flowing water into electricity. This is primarily done by damming rivers to create large reservoirs and then releasing water through turbines to produce electricity. Hydropower results in no emissions into the atmosphere but the process of damming a river can create significant ecological problems for water quality and for fish and wildlife habitat. Comparative evaluations with other alternative energy sources highlight trade-offs in capacity, siting, and ecological impacts.

Renewable Alternative Energy - Biomass Power

Biomass is second to hydropower as a leader in renewable alternative energy production and has an existing capacity of over 7,000 MW. As a renewable alternative energy source, biomass as a fuel consists of organic matter such as industrial waste, agricultural waste, wood, and bark. Biomass can be burned directly in specially designed power plants, or used to replace up to 15% of coal as a fuel in ordinary power plants. Biomass burns cleaner than coal because it has less sulfur, which equates to less sulfur dioxide being emitted into the atmosphere. Biomass can also be used indirectly, since it produces methane gas as it decays. Power can be produced from methane by burning in a boiler to produce steam to drive steam turbines. Steam can also be produce in gas turbines through internal combustion and reciprocating engines.

Renewable Alternative Energy - Geothermal Power

Geothermal power plants capitalize on high temperatures deep underground to make steam, which then powers turbines that produce renewable alternative energy. Geothermal power plants can draw from underground reservoirs of hot water or can heat water by pumping it into hot, dry rock. High underground high temperatures are accessed by drilling wells, sometimes more than a mile deep. In one sense, this geothermal energy is not renewable, since sometime in the future the core of the earth will cool. That time is so far off (hundreds of millions of years) that that we think of it as renewable. Geothermal heat pumps use compressors to pump heat out of the earth (for winter heating) or into the earth (when running as air conditioners in summer). The energy they pump into and out of the earth is renewable, since it is replaced by the cycle of the seasons. The energy that runs the compressor can either be renewable or conventional.

Renewable Alternative Energy - Solar Power

Solar power comes directly from the power of the sun and is used to produce renewable alternative energy, to produce heat, and for light. Solar represents a small share of the electric market in the United States – about one-half of one percent of electrical capacity. Solar power's contribution to heating and lighting is much larger because it can be produced either by power plants using the sun’s heat or by photovoltaic (PV) technology, which uses solar cells to convert sunlight directly to electricity. PV technology is more practical for residential use. Systems to use the heat of the sun directly can be either active or passive. In active systems, air or liquid circulate through solar collectors and bring heat to where it is used. In passive systems, buildings are built with heat-absorbing surfaces and windows set up to maximize solar heating in winter. Either renewable alternative energy solar technology is suitable for residential use. Systems to directly use the light of the sun are most common. The most usual device for using sunlight is the window, but skylights and skylight tubes are also used. Homeowners can explore design considerations in this primer on alternative energy solar power for residential applications.

Renewable Alternative Energy - Wind Power

Wind has been a fast growing energy source over the last decade mainly due to very significant improvements in wind power technology. Renewable alternative energy Wind power is produced by the wind's energy to turn aerodynamic blades that are mounted to a hub. The hub, which is connected to a shaft, turns a generator that produces electricity. Large utility-scale wind turbines range in size from 50 kilowatts to over four megawatts. Smaller wind towers (under 50 kW) are suitable for residential and agricultural use. Modern turbines are increasingly integrated into smart alternative energy systems that optimize output and grid reliability.

Renewable Alternative Energy - Fuel Cells

A fuel cell is an alternative energy device, but it is not necessarily a renewable energy device. It is only renewable if the source of the fuel used is renewable. A fuel cell is an electrochemical device, like a battery in that it converts the energy from a chemical reaction directly into electricity and heat. But unlike a battery, which is limited to the stored chemicals within, a fuel cell has the capability of generating energy as long as fuel is supplied. Modern fuel cells produce electricity by combining hydrogen and oxygen together without using combustion. The oxygen comes from the air, while the hydrogen can either be produced from water (using electricity) or extracted from fossil fuels. New fuel cells are being developed that can directly use fossil fuels. The 150-year-old fuel cell technology shows promise in providing energy for residential use and for powering vehicles.

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What is alternative energy? In electrical engineering, it denotes renewable power sources—solar PV, wind, hydro, geothermal—and enabling systems like power electronics, inverters, storage, microgrids, and grid integration to decarbonize electricity.

What Is Alternative Energy?

Alternative energy uses renewable electrical sources and grid tech to cut emissions and boost efficiency.

✅ Includes solar PV, wind turbines, hydro, geothermal, and bioenergy.

✅ Enabled by power electronics, inverters, converters, and smart grids.

✅ Integrates storage, demand response, and grid stabilization controls.

What is Alternative Energy? Alternative energy is power that comes from sources which are not going to run out, do not pollute as much as fossil fuels (oil, coal, natural gas), or do not create leftover materials that are harmful to people and the environment.

The term, "alternative," in a sense, is meant to contrast environment friendly energy against forms of energy that hurt the environment (coal power, natural gas, and oil power). Other names for alternative energy include clean energy, green energy and renewable energy. For readers new to the topic, you can explore concise summaries of technologies in the guide to forms of alternative energy to see how they compare.

Alternative Energy Vs. Renewable Energy

Renewable energy and alternative energy are often interchangeable, but they do have different meanings. Renewable energy comes from a replinishable energy source (it can never deplete). Electric energy that is generated from the sun (solar), the wind, the ocean (waves, currents or tides), the earth (geothermal), waste (biomass), landfill gas, or water (hydro power) is considered to be renewable energy. Renewable energy falls under the alternative energy umbrella because renewable fuel sources like wind and solar don't hurt the environment. For a broader overview, the relationship between categories like clean power and storage is outlined in the resource at renewable and alternative energy for further reading.

Alternative Energy Sources

A comprehensive overview of major options, deployment trends, and resource potential is compiled at alternative energy sources for additional context.

1. Alternative Energy as Solar Power

The sun has been around, shining on the earth with warmth and light for many, many years. This alternative energy source is available at no cost, and will be available to generate energy tomorrow and for millions of years to come, which explains why scientists continue to strive to figure out new ways on how to capture and use energy from the sun. For system basics, component choices, and siting tips, see alternative energy solar power to understand practical applications.

Long ago, it was discovered that leaving objects in the sun not only increased the object's thermal temperature, but the radiating heat also produced energy. Today, this type of alternative solar power, letting the sun heat something up, is called thermal solar energy. This alternative energy source is used to heat water for people's homes by passing cool water through pipes that are exposed to sunlight. As the pipes heat up, the water gets hot.

Another type of solar energy, known as light solar energy or photovoltaic energy, has only been used since the 1950s. This type of solar power comes from changing sunlight into actual electrical current. Very thin photovoltaic cells, which contain layers of different chemicals, absorb light from the sun and change it into electricity. The photovoltaic electricity is then stored in large batteries for later use, or it is actually sent back through the power lines to the electric company, which pays you for making electricity. Photovoltaic energy is growing in popularity every year. New types of photovoltaic cells, called “thin films”, are making solar electrical systems easier to put into homes, and less expensive than they were before.

Did you know: If one minute’s worth of all the sun’s energy that falls on the Earth was captured, it would be enough to provide the world with enough power for an entire year.

2. Alternative Energy as Wind Power

Wind energy has been utilized as an energy source for thousands of years. For example, the earliest sailors realized that putting sails on their boats to catch the wind made their boats go faster. More than 100 years ago, many farms used wind power to pump water from underground up to a container where it could be used for their homes or to water their animals. Today, wind power is used to turn large propeller blades that are put on top of towers. As the blades turn, their movement turns a generator, which changes the movement into electricity, which is sent to power stations or stored in batteries. Today, more people are buying small wind towers that make enough electricity to run their homes.

These days, very large windmills (known today as windfarms) are built in large groups. These windfarms are located miles away from where people live, and when the power is generated, the power is sent back to the cities and towns. Because wind patterns vary from location to location, some windfarms won’t work very well. But in windy areas, windfarms provide an efficient amount of electricity. Integrating wind with storage, efficiency, and grid modernization is covered under broader alternative energy solutions that help scale projects.

3. Alternative Energy as Water Energy (Hydro Electricity)

Water energy is another type of alternative energy that has been utilized for many years. Have you ever seen a water wheel next to a mill in an old painting or picture? The wheel was turned by the flowing water in a creek. The turning wheel was connected to a large millstone, which was used to crush grain to make flour and cornmeal. Today, electricity is generated using water. Large walls (dams) are built with tunnels to block flowing rivers so that the water can navigate through them, and, as the water goes through these tunnels, propellers turn a motor, which then generates electrical power. The generated power either is stored in batteries or is sent to a power station. Technology has developed enough that a small home can generate its own hydro power.

If a home is next to a creek or stream, a micro hydro system can turn a very small wheel, which then generates electrical power. Activists, scientists and some government officials have voiced their concerns that building large dams interrupt ecosystems, despite the fact that it generates millions of watts of power. However, the micro hydro technology can be used without hurting a small stream or the plants and animals that live there.

4. Alternative Energy as Biomass Energy

The farming industry, among other industries, are using corn and other plants as a biomass alternative energy source that can be put into the gas tanks of cars and trucks that can replace earth-damaging fossil fuels. Further feedstock pathways, conversion methods, and project case studies are outlined under biomass energy to illustrate real-world use.

The oldest type of biofuel is called biodiesel, which was first made out of plants and vegetables. Today, biodiesel is made out of old cooking oil and other types of plant materials that are not needed for other things. When it’s burning biodiesel made out of old cooking oil, the exhaust from a car’s tail pipe smells like french fries.

Ethanol, a second biofuel, is made by distilling plant materials (eg. corn) into grain alcohol, which is then mixed with small amounts of fossil fuel. When finished, this form of alternative energy can be used in cars, trucks and vans. While the farming industry is utilizing this readily available alternative energy resource, studies show that unless farms stop using petroleum-based chemicals for fertilizer and for killing pests, growing crops to make ethanol fuels may be more damaging to the environment than other forms of alternative energy. Comparisons with hydrogen, renewable diesel, and other alternative energy fuels highlight trade-offs in cost and lifecycle impacts.

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