Comparing wind and solar tells a clear story: the annual rate of wind power installations has roughly doubled since 2014, to an estimated 103 gigawatts (GW) in 2023. Yet there is a persistent issue that needs to be discussed: wind energy deployments are not keeping up with the rates of growth needed. Indeed, offshore wind tenders have continued in 2023 in Japan, Korea, Taiwan, Germany and the Netherlands. There are lessons to be learned here: project remuneration mechanisms could better reflect changes in costs (or increases in power prices), and work could be done to shorten the risky period between a project securing a revenue contract and getting the final go-ahead for construction.įortunately, this combination of circumstances looks unlikely to repeat in the near future, and will not threaten much of the existing wind project pipeline. The proximate causes were sudden cost increases that had not been priced into revenue contracts or auction parameters. The wind power industry last year had to endure a steady drip of high-profile offshore project cancellations on both sides of the Atlantic, and a failed UK auction. Here are three items that must top the agenda for this year: 1. These positive developments come after two years of energy crisis, supply-chain disruption and macroeconomic volatility – as well as geopolitical turbulence – and we could be forgiven for allowing ourselves a moment of satisfaction, or even optimism for the progress that is being made.īut the work of getting on track for net zero is not even half-done, and the to-do list remains daunting. This has led to a supply overhang and intense price competition, which may be an unsettling picture for competitors setting up shop in the West, but is great news for buyers of clean energy technology everywhere. Chinese companies have played a crucial role in this effort: both the solar and battery price trends can be attributed to a wave of investment in the supply chain in China over the past two years. Still, they have not risen markedly (in US dollar terms, at least) in the last two years. Wind turbine prices are an exception: they remain elevated from their pre-pandemic levels outside China. Lithium-ion battery prices have reversed their 2022 uptick and are now also at an all-time low. Solar PV module prices fell by 45% in 2023 and are now cheaper than at any time in history. More than 500,000 were sold last year, and BNEF is forecasting a million sales for 2024.įinally, the costs of clean technologies seem to be back under control. Sales of electric vans and trucks are booming as well. This isn’t just a wealthy country story either: EVs are making rapid progress in markets like India and Thailand. Reports of ‘softening demand’ for electric vehicles from some industry participants don’t seem to be reflected in the data, and may instead be a reminder that not every automaker will be successful in the switch to EVs. By 2026, EVs could account for almost a third of global auto sales – not a million miles from the trajectory needed for net zero. It looks like electric-vehicle sales in 2023 will have jumped some 33% from the prior year, to 14 million. Zero-emission transport is on a roll, too. This is a steep ramp-up, but it is achievable: our forecasts indicate the world is already set to see a 2.5x increase, and greater policy action could lift that closer to the threefold goal. Our Net Zero Scenario envisages a global installed fleet of 10.5 terawatts (TW) of wind, solar, hydro and other renewables in place by 2030 – almost a three-fold increase from 2022 – to put the world on track for net zero by mid-century. The goal of tripling renewable capacity, according to the analyst team at BloombergNEF, looks like the right one. Yet there is a daunting energy-transition to-do list that must be addressed in 2024, if we are to get on track for net zero by 2050.įirst, however, let’s consider what is going well. Last year ended on a positive note for the global energy transition, as several key agreements were reached at COP28: to pursue a tripling of renewable energy by 2030, to transition away from fossil fuels, and to accelerate energy efficiency improvements and methane-emission reductions. By Albert Cheung, Deputy CEO, Head of Global Transition Analysis, BloombergNEF
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