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Renewable energy capacity set to skyrocket by 2030

Annual investment in new renewable power capacity worldwide is set to grow over four fold between 2013 and 2030, according to new research by Bloomberg New Energy Finance.

The most probable scenario showed investments in renewable energy skyrocketing by 230 percent to $630 billion per year by 2030, driven by improvements in the cost-competitiveness of wind and solar technologies. The increase in development of other clean energy sources such as hydro, geothermal and biomass would also contribute to this growth.

Using its Global Energy and Emissions Model, B.N.E.F. drew three scenarios of energy future including “New Normal,” “Barrier Busting” and “Traditional Territory.”

Of these, the New Normal scenario is the likeliest, placing the investment needed for new clean energy assets in 2030 at $630 billion, which is more than three times the investment in the renewable energy capacity in 2012.

Significantly, this investment estimate is 35 percent higher than the research company’s forecast last year and the projection for total installed renewable capacity at that time is 25 percent higher than the previous forecast, at 3,500 gigawatts.

The energy future based on the other two scenarios are relatively different, though there will continue to be growth in renewable energy demand.

Under the Barrier Busting set-up, capital requirements for renewable energy could hit $880 billion by 2030. This would entail an additional $2 trillion or 22 percent increase in supporting infrastructure such as long distance transmission systems, smart grids, storage and demand response.

Under the Traditional Territory scenario renewable energy investment requirements are projected to be $470 billion by 2030.

“This is the first time we have produced such detailed analysis of the future world energy system under different scenarios,” said Guy Turner, head of economics and commodities for B.N.E.F.

“It highlights that, in spite of the recent news showing a downturn in clean energy investment since 2011, renewable technologies will form the anchor of new generating capacity additions, even under a less optimistic view of the world economy and policy choices,” he added.

The New Normal scenario shows a 70 percent increase in new power generation capacity between 2012 and 2030, which is largely attributed to renewable technologies. Only 25 percent will be coming from conventional energy sources like coal, gas or oil while the remainder will be from nuclear.

Wind and solar will take up the largest shares of new power capacity in terms of GW added by 2030, accounting for 30 percent and 24 percent respectively.

By 2030, renewable technologies will account for half of new power generation capacity installed globally, up from 28 percent in 2012. In terms of power produced, the share of renewables will get a boost from 22 percent in 2012 to 37 percent in 2030.

As for biofuel production worldwide in 2030, an increase of about 200 percent is expected, from 120 billion liters in 2012 to 370 liters in 2030.

“The main driver for future growth of the renewable sector over this timeframe is a shift from policy support to falling costs and natural demand. Our work also highlights, however, the importance of planning for the integration of intermittent renewables into the grid and into power markets. This will require significant new investment in grid infrastructure, load management and storage technologies,” stressed Mr. Turner. – EcoSeed Staff

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