In an energy-starved country like India, there is tremendous potential for increasing the share of solar energy, as the cost of the solar panels has dropped by a whopping 60-70% during the last couple of years.
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Renewable energy will supply the majority of Australia’s electricity by 2040, even without any additional government policy, according to predictions by energy analysts.
Both renewable energy and energy efficiency are competitive in electricity markets today, can be expected to grow in the future, and can play a significant role in state compliance plans for the CPP, while holding costs down, according to the AEEI report. Asia accounted for 72 percent of global coal consumption previous year. About 40 percent of the pie will go to coal plants, while nuclear and natural gas projects will receive 32 percent and 29 percent of investments, respectively, BNEF said. The revolution will hit rooftops around the world, bringing electricity to many remote villages for the first time.
Solar energy in particular will see a $3.7 trillion surge in investment through 2040, including $2.2 trillion for rooftop and small-scale systems, the London research group said in its forecast. BNEF’s sectoral products provide financial, economic and policy analysis, as well as news and the world’s most comprehensive database of assets, investments, companies and equipment in the clean energy space.
The world will add about 1,291 gigawatts of coal-fired stations by 2040, nearly all in developing countries, and 1,359 gigawatts of gas-fueled plants, the report showed. This is one reason why Big Oil recently called for a substantial global carbon price to help push out coal generation.
However, a substantive shift from fossil fuels to renewable energy wouldn’t happen until the mid-2030s, when a large number of Australia’s fossil-fuels plants are due to retire.
“With our existing suite of policies, coal generators will run for as long as is physically possible,” Mr. Bhavnagri said.
The renewable energy target was “the only policy presently operational that will have an impact on the power sector“, Bhavnagri said.
“Old coal is cheap because only the running costs need to be met”, BNEF’s Australian head Kobad Bhavnagri said.
Growth in wind, solar and flexible capacity such as batteries and demand response will make for more decentralized power grids.
“This will require sophisticated market mechanisms to be developed to enable the system to effectively utilize these assets”, Hugh Bromley, BNEF’s specialist in distributed energy, said.
Overall, the new report adds to a growing consensus that when it comes to energy, the world is moving in the right direction, and with considerable momentum – but still not fast enough.
Despite the change in makeup, Australia’s power sector won’t decarbonize substantially until 2036. Prior to that, by 2030 it was forecast there would be only a 9% fall in coal generation compared with 2014.
But even in 2040, fossil fuels will still account for 44 per cent of world generation, down from 67 per cent in 2014, which puts the climate in peril. Pollution will remain “stubbornly high” if the government does not accelerate the closure of coal and gas plants.
The report concludes that radical policy action needs to be taken to curb emissions, which is likely to heap further pressure on delegates at this year’s United Nations climate conference in Paris to agree an ambitious emissions reduction deal.
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