Renewables seen meeting 20 pct of global power needs by 2035
The energy industry will enter a transformative new era by 2035, when nearly 20 percent of global power needs are forecast to be met by solar or wind, displacing fossil fuels, according to analysts at Wood Mckenzie, a global research and consultancy group.
Wood Mckenzie began its history in 1923 as a “relatively unknown, Edinburgh-based stockbroker” and now counts Greentech Media among its holdings.
The consultancy group recently released a report, “Thinking global energy transitions: the what, if, how and when.” The report lays out the global energy transition and charts how the combined effects of electrification, such as with electric vehicles, and the growth of renewable energy sources will lead to a “point of singularity.”
The report predicts this will happen in 2035 and defines it as “when the world rings out the old and rings in the new. Sustainability friendly technologies, such as autonomous driving and the wider application of advanced grid-edge and machine learning applications, become the established modus operandi.”
The report also posits that peak oil demand will occur one year later and by 2040, electric vehicles will displace 6 million barrels per day of oil demand.
The power and transportation sectors now account for 70 percent of global coal demand, 50 percent of global oil demand and more than 30 percent of global gas demand. Under the global energy transition, the use of fossil fuels for transportation and heating will switch to electricity, analysts said.
“Accelerated technological advancements have created a bridge between futuristic goals of smart connected cities with autonomous systems and a large-scale commodity switch,” said Prajit Ghosh, global head of power & renewables strategy at Wood Mackenzie. “The result is that the energy transition seems less the plot of a sci-fi movie and more of a feasible, albeit ambitious, plan.”
The report addresses the small percentage of renewables already in the global market, marking it at 7 percent of generation but also notes that the genie is out of the bottle where it counts the most. “Solar and wind already provide 20 percent to 50 percent of generation in many complex regional power systems, some quite large,” said the report.
The report notes that the Electric Reliability Council of Texas (ERCOT), California ISO (CAISO), the Iberian Peninsula power grid in Spain and Portugal, and the German grids are leading the way in providing renewable energy.
The report said that by 2035 “close to 20 percent of global power needs will be met by solar or wind, enough to displace the equivalent of roughly 100 billion cubic feet per day of gas demand. Similarly, upwards of 20 percent of all miles travelled globally by cars, trucks, buses and bikes will use electric motors rather than gasoline or diesel.”
Wood Mackenzie covers its political bases by mentioning the possible effects of “policy drag” on the whole equation, especially relevant to the current political climate in the United States and Canada.
“The sluggishness of countries to formulate legislation or regulations could slow the arrival of the singularity,” the report said, noting the pullback of the United States from the Paris Agreement as an example.
Meanwhile, Canadian provinces are approaching a deadline later in 2018 to submit plans to price carbon. “The success of conservative party leaders opposing this at the ballot box would likely jeopardize a major plank of Prime Minister Justin Trudeau’s policy agenda,” analysts said.
