Disruptive changes to the natural environment resulting from the climate crisis are causing fundamental shifts in behavior and raising greater concerns about the future health of the planet and global population. Whether it’s sea-level rise, droughts, wildfires, or increasing frequency of extreme weather events, every part of the world has been impacted and forced to confront the implications to current and future generations. The importance of clean air, water and food are obvious, but what sets regions apart are the investments they make to secure these needs now and in the future.
Improvement in battery technology and storage capacity. By far the most important technological advances in renewable energy have been increases in efficiency and decreases in cost for batteries. Because of the intermittent nature of renewables (solar and wind), it is necessary to store energy within the grid to cover the peak hours of consumption. This peak imperative may also result in the growth of residential energy storage as grids use home storage or even electric vehicles to better match supply and demand.
Nuclear power divergence. While not broadly considered a renewable energy, nuclear power has split prospectives, with China planning to bring significantly more plants online and many countries in Europe moving away from nuclear power as a reaction to the Chernobyl and Fukushima disasters.
Electric vehicle growth. Electric and hybrid vehicles are increasingly prevalent globally, representing about 3.6% of automobiles worldwide in 2019, with a 20.2% compound annual growth rate over the next five years. Most currently use lithium ion batteries.
Renewable energy in utility grids. Renewable energy has become a sizeable portion of the global electricity supply, at approximately 33%, with renewable electric generation surpassing coal in the United States for the first time ever, in April 2019, at 23%. Solar and wind have also recently surpassed the older hydropower technology in their percentage of supply.164
Oil price’s threat to normalizing alternative energy. Early 2020 experienced a rapid global decrease in oil prices resulting from limited cooperation between Russia, Saudi Arabia and the United States. These decreases were exacerbated by the global economic slowdown caused by the COVID-19 pandemic.
The global increase in demand for energy shows no sign of long-term slowdown. As society and industry continue to see the need for resilient electric grids to protect against increasing natural disasters and intense weather events, distributed generation and storage models will begin to more significantly compete with the traditional hub-and-spoke model. Compared with other capacity-building activities, distributed models provide multiple redundancies in systems and sometimes even savings due to shorter transmission lines. Advances in residential energy storage systems’ capabilities and cost should enable this transition. These systems are expected to experience rapid growth in the next five years. Similarly, the global market for lithium batteries should continue to grow at a rapid pace over the next five years because of this market shift and electric vehicles’ growth.
While bold action may take a backseat in 2020, corporations and governments will continue to make policies supporting renewable energy usage in the future. The Russia-Saudi oil conflict will also impact climate mitigation as the price of oil is suppressed and a reduction in carbon emissions caused by slowed economic production lessens the effects of carbon taxes. The resulting lower price for fossil fuels in the short term will make renewables less attractive by comparison. In speaking about these effects, Tristan Brown, associate professor of Energy Resource Economics at State University of New York College of Environmental Science and Forestry, said, “It will have a very detrimental impact on climate initiatives on just about every level.” Despite the short-term slowdown in sustainable-energy investments, in the longer term, Brown expects growth will return out of necessity. Energy access in developing countries is likely to skip straight to distributed renewable models in many areas, given the favorable solar conditions and current lower power demands.