December 14, 2021 3:52 pm
In May Heymi Bahar, spokesman for the International Energy Agency (IEA), said that the “new normal” could be a much faster-than-expected expansion of renewable energy, driven mainly by market forces. This phenomenon would be so sudden as to create a new type of risk (on which, however, Bahar did not go into detail).
The good news is obvious and undeniable. There has been a change of pace in the growth of wind and solar energy, the production of which increased by 45 percent globally in 2020. Despite the pandemic, this year’s production will be even higher. More importantly, the use of other energy sources is not increasing.
In the old scenario, the global economy was growing at about 3 percent per year and the demand for electricity was growing a little faster. Renewables (especially hydroelectric energy, but to a lesser extent also wind and solar energy) grew more or less at the same rate, but the share of renewables with respect to the total energy produced remained blocked at 15 percent. Nuclear power and fossil fuels covered the remaining 85 percent.
Affordable costs
This is why global carbon dioxide emissions have not decreased – indeed, they have increased every year since the global warming alarm was raised. Today they are 40 percent higher than in 1990. The only hope for reducing emissions was a “comeback” of energy not derived from fossil fuels.
Forget the climate change denial campaigns funded by the fossil fuel industry. Sure they did some damage, but the truth is that gas, oil and coal kept their dominance mainly because existing alternatives couldn’t expand further (like hydroelectricity) or were much more expensive (like wind power). , photovoltaics and nuclear power).
Now the situation has changed. In the last decade, the “discounted” cost of energy derived from renewable sources has dropped significantly: 60 percent less for wind power, 80 percent for photovoltaics. This means that in many areas of the planet the two alternatives are today cheaper than energy derived from fossil fuels. This trend has been visible for years, but is now producing concrete effects.
The share of electricity derived from non-fossil sources reached 27 percent in 2020 and will rise to 29 percent in 2021, with a further 3 percent increase expected next year. Photovoltaics accounts for more than half of this percentage, and wind covers almost everything else. According to the International Energy Agency, renewables will account for 95 percent of new energy generated globally by 2026.
Rising prices for raw materials and shipments are driving up costs for the renewables industry
If the percentage of renewables compared to the total energy produced is currently growing by 2 percent per year, what will it be in 2026? 40 percent? And in 2030? Maybe 50 percent? It would be a real revolution, with all the mess and jolts that revolutions bring.
Of course, there are many things that could go wrong and upset these predictions. Prices of raw materials and shipments are skyrocketing, significantly increasing costs for the renewables industry. The price of polycrystalline silicon, used to make solar panels, has quadrupled since 2020. In addition, there may be a shortage of materials that are used to produce clean energy, such as lithium and rare earths.
But costs are also rising for rival energy sources, and renewables have held the price advantage so far. So the question remains: what will happen if fossil fuels enter a rapid and unexpected phase of decline, with a third of the current market disappearing by 2030 and much of the rest over the course of that decade?
A desirable consequence would be an equivalent decline in carbon dioxide emissions, perhaps rapid enough to allow us to contain global warming by 1.5 degrees over the next decade. This development would save the lives of tens of millions of people and save several trillions to tackle the damage caused by fires, floods and storms.
The negative result would instead be chaos within the sectors that will “fade” too quickly. There will be no time for a transition and training of workers, just total collapse. We can already imagine a similar demise for the automotive industry sectors that did not make the turn to electricity, as well as the entire coal industry.
The gas industry is heading for a rapid decline, while the oil industry will split between the few low-cost producers in the Gulf, who will stay afloat by radically cutting prices, and all the others, who will crash into a wall. Then, around 2040, what remains of the oil industry will also vanish.
If you cannot imagine the geopolitical conflicts produced by such a scenario then you are not really trying. But this is still the most encouraging scenario I’ve seen in years. And if we can truly replace the entire global energy infrastructure within a single generation, averting major wars or famines, I am willing to revise my assessments of the fate of human beings.
(Translation by Andrea Sparacino)
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