“It’s 2017, energy should be free by now!”
People seem to think that not only will renewables singlehandedly clean up our climate, but they’ll also make energy totally free.
I think that’s silly.
Nothing is free, and someone will always be making money off of essential technologies. However, renewables could be making energy more affordable as the technology improves.
Bloomberg New Energy Finance estimates that by 2040, renewables will account for 35% of the world’s total energy production. The International Energy Agency (IEA) estimates solar and wind alone will account for a slightly less optimistic 21% of the world’s total by then.
Source: IEA Medium-Term Renewable Energy Market Report 2016
Either way, it’s clear the push for clean energy isn’t stopping anytime soon, and in fact is accelerating in a number of key energy markets.
Here are the countries currently putting the most into expanding their renewable industries…
No surprise here! With cities so famously choked in smog that they’ve made medical facemasks into a fashion statement, renewable capacity will be growing faster in China than anywhere else in the world.
Last year, the country installed around 35 gigawatts of new renewable capacity. By 2020, the country will have installed an additional 200 GW of wind power and 120 GW of solar, plus around 340 GW of hydropower and 58 GW worth of nuclear reactors.
This will more than cover the 100GW of coal capacity that the country recently canceled, too.
The country plans to invest as much as $364 billion into renewable energy by 2020 and nearly $780 billion by 2030.
We’ve been giving this one a lot of attention recently, and for good reason.
Much like China, India needs to cut back on the smog-causing energy production. To that end, officials have already stated that the country will not be building any new coal capacity once the 50GW currently under construction is complete.
India’s draft National Energy Plan, updated last year, estimates that the country will have as much as 175 GW of installed renewable capacity by 2022. Solar especially is gaining in this country and will account for 100 GW of that added capacity.
The country is also looking into expanding its electric vehicle market. Though crude oil demand is expected to grow more in India than anywhere else over the next few years, the country is aiming to have all new cars sold be electric by 2030.
A deal with Tesla currently in the works could make this plan all the more viable.
3. United States
Forget the Paris Agreement and all the drama surrounding it.
The country’s renewable industry doesn’t need a global initiative to keep right on growing. We’re already second only to China in wind capacity, and we’re fourth in installed solar PV capacity behind China, Germany, and Japan, according to the IEA.
In 2016, newly installed renewable capacity accounted for 61.5% of the country’s total new energy installations, meaning clean energy outpaced all fossil fuels and nuclear combined!
The Energy Information Administration estimates that total installed renewable capacity will surpass U.S. nuclear capacity by 2020, and we’ll have more renewables than coal running by 2040.
And while all of this is going on, California recently made its own deal with China to cooperate on the development of ever cheaper, more efficient clean energy technologies.
Probably not a necessary move for the industry, but it never hurts to have such a big investor on your side.
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Japan’s clean energy push is focused mainly on solar, which covered a full 4.3% of the country’s energy production last year, according to the country’s Renewable Energy Institute. Renewables as a whole accounted for 14.2% of the country’s production throughout the year.
After the Fukushima nuclear meltdown in 2011, the country’s investments in renewable energy skyrocketed, putting it in third place behind China and the U.S. by 2015.
Before the meltdown, renewables only covered around 9.6% of Japan’s energy production. By 2015, that number had climbed to more than 14%. And while natural gas replaced much more capacity than renewables, expensive foreign fuel imports are making cheaper alternatives all the more attractive.
This country got a lot of attention last year when it was reported that nearly 100% of the country’s energy demand was covered by renewables for part of a day.
This year, the country announced that it had broken another record by covering 85% of its energy needs with renewables for a full weekend at the end of April. And while this is far from the norm today, Germany expects it to be common practice by 2030.
The biggest challenge facing all these countries, and the industry as a whole, is price.
Renewables, including hydropower, solar, and wind, are already cheaper than coal in some regions today, but the cost of integrating them into large-scale grids is still high. That’s why, for now at least, natural gas will continue to dominate the global energy mix.
But make no mistake, that won’t always be the case. Multiple estimates claim that renewables could be cheaper than all fossil fuels worldwide within the decade, and capacity growth will continue no matter what.
It’s only a matter of time before clean energy and the energy storage tech it relies on outpace even the most stalwart fossil fuels.
Until next time,
Energy and Capital