Header  home

EMERGENCE OF THE RENEWABLE ENERGY ERA

For the first time in history, renewable energy installations are outpacing new installations of fossil fuel based energy systems, even when accounting for the combined capacity of coal, oil and natural gas. Even though solar energy currently makes up less than 1% of the world’s global energy supply, the tides are changing in the favor of renewable energy technology.

Energy Flow Chart – Source: Lawrence Livermore National Laboratory

The turning point actually occurred in 2013 when 143 GW of new renewable capacity were installed, barely beating the 141 GW of fossil fuel systems installed that same year. Since then renewable energy has been on a tremendous growth trajectory, with one solar module being installed every 2.5 minutes in the United States, and wind farms in China producing more energy than all nuclear power plants in the United States. Renewable energy systems are also becoming more and more sophisticated, as can be seen by the rise of microgrids and smart grid systems that use software to mange energy more effectively. Moreover, costs for many technologies continue to fall, further implying that renewable energy will soon have the advantage of traditional fossil fuel technologies. In addition to being more environmentally sustainable, many of these new energy systems offer innovative value propositions, such as energy independence in the case of microgrids, that will make it more and more difficult for traditional systems to compete in the energy market.

 

Global Energy Trend Forecast – Source: Bloomberg Finance

These trends have already prompted reports stating that renewables have won the race against fossil fuels by publication including Bloomberg Finance. Yet, even though the trends have shifted towards the favor of renewable energy technologies, the battle is not won just yet. The same Bloomberg report that claimed the victory of renewables warned that larger amounts of investments on the global scale are needed to prevent the worst consequences of climate. In the figure below, light blue indicates the amount of investment analysts believe is needed to meet global energy demands with renewable energy to prevent to stay within the 2 C warming limit, while red shows the actual investment in renewable energy technologies.

Global Renewable Energy Investments – Source: Bloomberg Finance

As can be seen from the figure above, there is still a along way to go before renewable energy can start making a substantial difference in the challenge to mitigate climate change. It appears that even though renewable energy has just won a major battle, the true challenge and opportunities are only just beginning.

 

This post was originally posted by Santiago Miret on Berkeley Energy & Resources Collaborative