The Rise of the Renewable Energy Economy
Renewable energy is projected to provide half of the world’s electricity within the next 30 years. This may seem like a lofty prediction; however, renewable energy currently accounts for 28% of the global electricity and power capacity is expected to increase by 49% in the next 5 years. 96% of 2018’s renewable energy was produced by three main areas; hydropower, wind, and solar. Projections are already being made that by 2024 a third of the Earth’s electricity will be provided by renewable energy which will be neck and neck with the world’s current generating leader, coal.
Leading the renewable energy growth trio is solar generation with expectations of growing 60% by 2024. There is estimated to be 100 million solar rooftop systems for homes in operation by 2024, which is 6% of the world’s available rooftops, leaving room for substantial growth. Over that timeframe, solar costs are predicted to tumble another 15-35% because of easier installation methods and learning-by-doing effects. Easier installation lowers installation costs and more accessibility to the public. Resource availability is not the only area for growth. Declining technology costs, regional load growth, and renewable policies all lead to an increase in the solar generation market.
Second to solar, wind power should also show substantial growth in the next few years. Onshore wind is expected to make up a quarter of the renewable energy growth over the next 5 years. Texas has seen such success with 22% of their power generated from onshore wind energy, which is only expected to triple by 2024. Offshore wind only grew by 15% in 2018 and would need to more than quadruple by 2030 to stay aligned with the International Energy Agency’s (IEA) Sustainable Development Scenario. There is expected to be 45-50% cost reductions in the next 5 years for offshore wind projects due to the economy-of scale advantages. However, wind is still relatively new compared to solar and the declining capital costs are not as steep. Wind also has less abundant areas for development leaving it second in growth.
Hydropower, third in renewable growth, is a method of generating power that has been around for thousands of years. The use of a hydropower turbine for electricity began in the mid-1700’s and we have only advanced this method to become the integral part of the renewable energy mix today. Growth in the hydropower market is not as vast since the main production method for hydropower is through an existing dam or construction of a man-made dam for generation. Although hydropower is a clean and reliable source of power generation, the production of hydropower plants can be slightly more capital intensive than solar power.
The benefits of renewable energy go beyond emission standards, but they also bring economic benefits. Renewable energy jobs employ 10 times more people than the fossil fuel industry and has been steadily growing. In 2018, renewable energy jobs rose 3.4% and accounted for 28% of all energy jobs. Thirteen states alone saw an increase of 5% or more in renewable energy jobs. The largest increase was in New Mexico with 11.6%, followed by Nevada with 8.1%, and then Colorado, Oklahoma, and New Jersey with 7% increases. Renewable Portfolio Standards (RPS) mandates set by states are requiring a share of electricity to be generated from renewable resources and most states are increasing these moving forward. Connecticut increased their overall RPS target to 48% by 2030 up from the previous target of 27% by 2020. California increased their target to 60% renewable shares by 2030. The District of Columbia (DC) increased its RPS to a total 100% renewable share of sales by 2040 making DC the third in the U.S. to pass an overall RPS target of 100%, behind Hawaii and California. After reviewing the RPS standards and its growth over a few years, it is apparent that this industry is only on the brink of what it is capable of for the future.
As renewable energy becomes increasingly more accessible and weaved into our policies, it is easy to see how vast the industry will grow. Its growth will not only offset carbon emissions but will change our economy. APPI Energy can provide you with the steps to utilizing renewable energy through our Energy Solutions Division. Speak to your Energy Consultant about our powerful and holistic energy management solutions to explore ways to reduce energy demand, reduce energy costs, and increase your sustainability. To inquire about an energy efficiency project, please visit our website at www.appienergy.com or call 800-520-6685.
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