Renewable energy has hit a new milestone, with one trillion watts of wind and solar capacity now installed.
Wind farms and solar panels can now generate more than one terawatt of electricity around the world, according to the Bloomberg New Energy Finance (BNEF) database. At the end of June 2018, global installation capacity could generate 1,013 gigawatts, with 54% coming from wind and 46% from solar, the data revealed.
Although this one terawatt only constitutes roughly 6% of the total global electricity consumption, it could still power about 10 billion 100-watt home lightbulbs.1 BNEF predicts that the second terawatt will be generated within the next five years and will cost 46% less to install than the first. Total installed wind and solar capacity has now quadrupled since 2010 and grown 65-fold since 2000, the data shows.
As the world battles global warming, replacing fossil fuels use with natural energy sources from wind, solar, hydro or biomass is turning renewables from niche to mainstream. The industry is reaching critical mass, to the point where it is replacing traditional industries such as coal without the need for subsidies.
The statistics that illustrate just how far renewable energy has come read like a shopping list of superlatives. Morocco, for example, is building a solar farm in the Sahara Desert that will be the size of Paris. The colossal USD 9 billion project covering 1.4 million square meters will eventually generate enough electricity to power more than one million homes.2
Perhaps surprisingly, the country that now leads the world in offshore wind turbines is the island nation of Britain, with more than 1,400 turbines already installed, including the world’s largest wind farm – the ‘London Array’ field in the North Sea. Together with onshore turbines, they currently provide enough energy to power four million homes.3
The wind turbines themselves are becoming larger than skyscrapers. In April, GE Renewable Energy announced plans to install the world’s largest wind turbine in north-east England – a 260-meter tall machine with blades 107 meters long. It will be almost as high as the UK’s tallest building, the 306-meter Shard tower in London.4
The UK is a good example of how renewables are gradually replacing traditional reliance on fossil fuels. In 2016, the country generated more electricity from renewables – mostly wind farms – than coal for the first time. In April 2018, Britain went more than two days without using coal power for the first time since coal-fired stations were built in the late 19th century. The UK also possesses Europe’s largest floating solar park and has a significant presence in biomass.5
Across the world, a UN report published in April showed that more money was in invested in solar energy than in coal, gas and nuclear combined in 2017, with China leading the way. A record 157 gigawatts of installations using renewable sources – equivalent to about 200 large coal-fired power stations – was commissioned in total. Globally, the proportion of energy generated by renewables has risen from about 5% to 12% in a decade. This translates to around 1.8 trillion tons of carbon dioxide emissions being avoided last year – the equivalent of removing the entire US transport system.6
The transition forms part of attempts to meet the Paris Agreement of 2015 and limit global warming to between 1.5 and 2 degrees Celsius above pre-industrial levels. The EU’s Europe 2020 targets include commitments to reduce greenhouse gas emissions by at least 20% compared to 1990 levels; increasing the share of renewable energy in final energy consumption to 20%; and moving towards a 20% increase in energy efficiency.7
It is also creating millions of jobs. Employment in the renewable energy industry has topped 10 million people for the first time, a 5.3% rise since 2017, according to the International Renewable Energy Agency. Almost half of this tally is in China, while 14 times as many people in the US work in the renewables sector than in the coal industry.8
The relentless rise of renewables is taking many by surprise, says Chris Berkouwer, a portfolio manager in Robeco’s Global Stars Equities team who specializes in the sector. “Who, for example, would have thought that the state of Texas, the birthplace of America’s oil and gas industry, is by far the leading employer in wind-related jobs?” he says.
“Texas even accounts for about one quarter of total wind power capacity in the US. In fact, with about 25 gigawatts of wind power in the state, only five countries in the world have more wind power than Texas.”
“As the technology has improved dramatically, the opportunities to deploy renewable energy technologies has increased exponentially. Wind energy only used to work in high windspeed areas, onshore, yet far away from civilization. Nowadays, turbine makers are launching floating offshore wind platforms which could substantially increase the geographic coverage of wind power generation.”
‘One of the main drivers has been an increase in storage technology’
“For example, in late 2017, 25 km off the coast of Aberdeenshire in Scotland, the first-ever floating wind farm was installed. Although its five 6 megawatt turbines only power 20,000 households in the UK, the opportunities for similar floating wind farms across the globe are plentiful.”
At the current rate of progress, BNEF projects that renewable energy will account for two-thirds of the global power system by 2050 – a threshold that could be reached in Europe by 2030. “One of the main drivers behind this dramatic increase will be the improvement in storage technology,” Berkouwer says. “This will lower costs significantly, thereby accelerating the adoption of renewable energy globally.”
“As the first terawatt of renewable energy required USD 2.3 trillion of capital spending and was accompanied by only 7 gigawatts of storage (only about 0.7% of global installed capacity), the second terawatt will come at almost half the cost and with nearly 20 gigawatts of storage, as estimated by BNEF.”
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