Global Energy Transition is Unstoppable

By Tomas Kåberger

Renewable Energy Institute


opportunities are growing as the industrial experience has brought down the costs of electricity from renewables. In the 20th century, resource depletion and greenhouse gas emissions appeared to set energy constraints on global human development. Today, the dramatic reduction of costs has made renewable electricity generation as the lowest cost source of new electricity in most parts of the world, in a growing number of places without subsidies.
Still, we may fail to utilize these opportunities at sufficient speed to avoid the risks of unmanageable rate of climate change. In order to succeed a combination of intelligent and determined political and industrial leadership is desired.
Opportunities are illustrated by the rapid development of solar and wind electricity in the United States, and even larger capacity installations in China. The economic competitiveness developments are also visible in Europe were in 2017, the first commitments by large power producing companies to deliver electricity from off-shore wind without subsidies off the German and later Dutch North-sea coast-lines. This achievement was possible after years of developments involving subsidies from governments, and development efforts by suppliers of power plants.
Important for success was the development of an off-shore wind infrastructure consisting of dedicated ships and harbor facilities. And not least, a workforce accumulating experience and know-how.
Economy of scale from larger individual power plants as well as larger parks and fully deployed infrastructure made possible by a decade of expanding projects in northern Europe provide an example for other parts of the world to follow. We can see just that happening in parts of Asia and North America.
While off-shore wind is often a business for established energy companies, on-shore wind is more often involving new actors and so is the development of solar electricity.
Wind power plants are often owned and controlled by new sets of actors including customers, land owners and financial actors detached from the traditional energy industry. A mix of smaller and larger wind power parks contribute a growing share of electricity generation in many countries. In Denmark close to half of the electricity is generated from wind energy, and in other countries the share is growing fast, where investors no longer depend on subsidies, but instead rely on transparent electricity markets under neutral system operators which provide fair access to the new entrants competing with the incumbents.
Solar electricity is providing households cheaper electricity than the conventional power supply system in most parts of the world. The economies of scale are available in the manufacturing of the equipment while decentralized electricity production offers many advantages.
Solar electricity is providing households with cheaper electricity than the conventional power supply system in most parts of the world. The economies of scale are available in the manufacturing of the equipment while decentralized electricity production offers many advantages. Blocking development is often legislation and institutionalized tradition developed in the 20th century for centralized system of large thermal power plants. Wise political leadership may provide opportunities for individual electricity customers to produce electric power while reducing the traditional market power of large electricity companies.
For millions of the world’s poorest, solar electricity has provided the opportunity to get access to low cost electricity and batteries providing light in the evenings, opportunities to charge mobile phones, enjoy radio and television and a service from a refrigeration box. This has been achieved without grid infrastructure and without the involvement of any subsidies or aid systems. A solution to the most important desires of the poor.
Some claim this is insufficient as it is only solving the electricity supply without replacing the use of fossil fuels. Others say these power sources are of little value as they are not even able to keep the balance in the electricity grid.
They may soon both be proven wrong. Renewable electricity is already cheaper than crude oil per unit energy. Thus, instead of the 20th century model where fuels are used to produce electricity at a rate set to balance the electricity grid, renewable electricity may be used to substitute oil and then to produce fuels. This fuel production will be guided by the market prices at a rate that will keep the balance between production and consumption in the electricity grid.
We see already a growing use of electricity in the transport sector. Increased demand for batteries for vehicles is bringing down cost of batteries with experience and economies of scale in manufacturing. This will widen the market for batteries in the electricity grid as well.
Transmission of electricity with higher voltage and lower losses has taken large steps forward driven by China’s need to supply its growing economy from distant resources.
Batteries, production of fuels from electricity, and ultra high voltage transmission will provide for a new era where renewables may provide a growing global prosperity beyond the 20th century resource and environmental constraints.
But the speed of change will depend on political and industrial leaders who are guided by the interest of the people in the world – nothing less.
TOMAS KÅBERGER is Executive Board Chair, Renewable Energy Institute. He is a graduate of the UWC of the Atlantic in Wales