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Global Renewable Energy Growth Expected to Be Strong to 2030

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May 27, 2013

Global Renewable Energy Growth ( Solar Thermal Magazine ) – Improvements in cost-competitiveness means that renewables will account for between 69% and 74% of new power capacity added by 2030 worldwide, despite current difficult market conditions.

London and New York, 22 April 2013 – New research by analysts at Bloomberg New Energy Finance show that annual investment in new renewable power capacity is set to rise by anywhere from two and a half times to more than four and a half times between now and 2030. The likeliest scenario implies a jump of 230%, to $630bn per year by 2030, driven by further improvements in the cost-competitiveness of wind and solar technologies relative to fossil fuel alternatives, as well as an increase in the roll-out of non-intermittent clean energy sources like hydro, geothermal and biomass.

 

This is the message of new research published today by Bloomberg New Energy Finance. The findings will be unveiled to delegates this afternoon at the analysis company’s sixth annual Summit, in New York.

Bloomberg New Energy Finance’s predictions for world energy markets to 2030 come from its Global Energy and Emissions Model, which integrates all of the main determinants of the energy future, including economic prosperity, global and regional demand growth, the evolution of technology costs, likely developments in policies to combat climate change, and trends in fossil fuel markets. Together these form three scenarios: “New Normal”, “Barrier Busting” and “Traditional Territory”.

The New Normal scenario is considered the most likely. It shows the investment requirement for new clean energy assets in the year 2030 at $630bn (in nominal terms), more than three times the investment in the renewable energy capacity that was built in 2012. This 2030 investment figure is 35% higher than that produced in Bloomberg New Energy Finance’s last global forecast a year ago, and the projection for total installed renewable energy capacity by that date is 25% higher than in that previous forecast, at 3,500GW.

In the power sector, the research company’s latest forecasts project that 70% of new power generation capacity added between 2012 and 2030 will be from renewable technologies (including large hydro). Only 25% will be in the form of coal, gas or oil, the remaining being nuclear. The scenarios are based on Bloomberg New Energy Finance’s latest projections for coal and gas prices. For gas, these assume prices stabilise in real terms at $6, $9 and $11/MMBtu in the US, Europe and the Asia respectively.

For comparison, the International Energy Agency’s New Policies scenario forecasts that 57% of power capacity added during this period will be from renewable resources (including large hydro).

Bloomberg New Energy Finance predicts that wind and solar will take up the largest shares of new power capacity added in terms of GW by 2030, accounting for 30% and 24% respectively. By 2030 renewable technologies will account for 50% of new power generation capacity installed around the world, up from 28% in 2012. In terms of power produced, the share of renewables will increase from 22% in 2012 to 37% in 2030.

The New Normal scenario’s outlook for global biofuel production in 2030 is that it will increase by around 200% from 120bn litres in 2012, to 370bn litres in 2030.

The future under Bloomberg New Energy Finance’s other two scenarios look somewhat different, although in both cases, there will be further growth in renewable energy demand. Capital requirements for renewable energy could reach $880bn by 2030, under the Barrier Busting assumptions ($9.3 trillion cumulative from 2013). This would require an additional $2 trillion (22% increase) invested in supporting infrastructure such as long distance transmission systems, smart grids, storage and demand response. Under a more pessimistic view of the world, in the Traditional Territory scenario, renewable energy investment requirements are projected to be $470bn by 2030 ($6.1 trillion cumulative).

Guy Turner, head of economics and commodities for Bloomberg New Energy Finance, commented:

This is the first time we have produced such detailed analysis of the future world energy system under different scenarios. It highlights that, in spite of the recent news showing a downturn in clean energy investment since 2011, renewable technologies will form the anchor of new generating capacity additions, even under a less optimistic view of the world economy and policy choices.

The main driver for future growth of the renewable sector over this timeframe is a shift from policy support to falling costs and natural demand. Our work also highlights, however, the importance of planning for the integration of intermittent renewables into the grid and into power markets. This will require significant new investment in grid infrastructure, load management and storage technologies.

Michael Liebreich, chief executive of Bloomberg New Energy Finance said: “The news right now is dominated by stories of pain caused by overcapacity on the supply side of clean energy, and the lure of cheap shale gas. But this is playing out against the falling costs of renewable energy and of all the technologies required to integrate it into our energy system, and falling costs win. What it suggests is that we are beyond the tipping point towards a cleaner energy future.”

More details on the three scenarios, and their implications for future energy markets, are available in the Global Renewable Energy Market Outlook fact pack. This will be available to the media on request.

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James Isola

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One of the claims of many cloud technology vendors is that you can save money by dealing directly with them.

These claims are often made to justify the practice of renting software rather than purchasing it. Accounting software, for example, used to cost a few hundred dollars every two to five years, at the discretion of the business using the software. These days we increasingly rent it, in the cloud for thirty to fifty dollars a month.

The advantages to the software company are obvious, the fact that they have to work so hard to sell the advantages to us is some indication that it is something of a one way street. There are fewer advantages flowing to us.

The notion, then, that the cloud offers us a support free environment in which we can eliminate some of the costs of keeping our networks up to date, maintaining the latest version of the software and so on, is an integral part of the story. It is true, cloud software keeps improving, without any real effort on our part.

There is a further advantage. The level of integration available between cloud vendors thanks to the wonders of web-services is incredible. My accounting software, interrogates my bank accounts, submits forms on my behalf to the tax office and invoices to those suppliers using the same package. That offers a considerable cost saving. Even more impressively, at year end, it produces the paperwork to submit to ASIC, saving me $750 at the accountant.

That is a good example of the cloud delivering on its promise.

The network of computer dealers, the channel, who traditionally serve the small to medium enterprise market are themselves small to medium enterprises and they are directly in the firing line of the cloud vendors. It is the elimination of the channel that is supposed to justify the increased costs of renting rather than buying software.

Channel consultant and 2011 inductee into the Australian Reseller News Hall of fame, Moheb Moses, has written eloquently this month on the dangers inherent in this simplistic approach. As a channel consultant his job is to help resellers respond to this challenge and he makes some important points. Primary among these is identifying the real value proposition of resellers in the age of the cloud.

The value offered by software distributors and installers to customers is not neccesarily vendor-specific, they really come into their own in looking after our interests, in understanding our business requirements and fine-tuning the combination of products we need to best serve those requirements.

He inverts the traditional diagram of how the channel works to explain the problem.

 “Ask most vendors why they have a channel and they will usually provide reasons like reach, coverage, access to new customers, etc. In effect they view the role of the channel as an extension of their sales force.

Interestingly, when partners are asked this question many of them also provide a similar answer. But this is a vendor-centric view of the world.

When we look at the role of the channel from a customer’s perspective, we almost need to turn this diagram upside down.

In other words, users perceive the channel as their conduit to multiple products and services from multiple vendors to create a solution. In effect they view the role of the channel as an extension of their IT Department.

He then goes on to point out that the impact of the cloud may have eliminated some of the advantages that the channel offered the vendor, but they have not eliminated the advantages that that network of suppliers and support agencies offers to the user.

The problem is when you look at it from a customer’s perspective. If we replace the channel with a cloud, as in the diagram below, the customer experience may not always be ideal.

The issue for customers (especially in that enormous gap between Consumer and Enterprise) is that they need more than single function consumer apps, and they don’t have the internal resources that Enterprise has to evaluate and build the best solution themselves.

And while the pure cloud vendors will say they have a “complete solution” they are only talking about their piece of the puzzle. For example, a cloud CRM vendor won’t sort out a problem with (say) the cloud Salesforce Automation vendor’s product. The cloud Email Archiving solution may use a completely different architecture to the rest of the cloud Backup and recovery strategy. In fact, for a lot of customers, getting technical assistance with a cloud product can be a problem because they often don’t even know where to start or their only means of communications is a faceless chat box.

So, until every vendor can solve every problem for every customer, the channel is unlikely to disappear. Yes the role of the channel will change. Maybe instead of Systems Integrators, we’ll see Cloud Integrators or Cloud Brokers. Maybe instead of profit models being based on big lumpy one-off payments, businesses will adapt to smaller monthly recurring revenue streams. But the channel exists to fill the gap between the vendor’s product and the customer’s expectations, and I think we will need companies to do that for a long time to come.

As we have written in Business Voice numerous times before, the critical element for success in an interconnected world is that we define the unique advantage that we offer, focus on that, and network with other agencies who can provide the complementary components. The twentieth century model of expanding through the value chain is only available to the very successful and very large.

As businesses facing the challenge of paying more for the software that we used to upgrade only when we could afford it we need to work out how to maximise the value we get from that investment.

Using our cloud suppliers to provide the matching of our business requirements to the mix of sofware services which we buy is almost certainly a big part of the puzzle.

Newly launched superannuation provider MyFuture Super claims to be Australia’s first fossil-free superannuation fund. The company said today that many funds are marketed as sustainable but invest in fossil-fuels such as coal seam gas and petrochemical companies such as Exxon Mobil, BP, Woodside, Rio Tinto and Petronas Gas.

The company is appealing to investors keen to use their superannuation as a tool to counter corporate influence on government policy.

“If 20,000 of us were to shift our superannuation, we’d have a billion dollar divestment movement. With tens of thousands of Australians regularly taking part in rallies and marches in support of climate action, adding divestment to the mix will really turn up the heat on the fossil fuel industry,” the company’s press release said.

There is still a pathway to cutting carbon pollution rapidly enough to avoid the worst climate tipping points. It begins with shifting our money out of funding climate collapse and into funding climate solutions.

The announcement closely follows the publication of Karen McLeod’s article on the performance of ethical investments in Westender’s September edition.

Fundraising concert Freedom Seeker – Roots Rock Reggae for Refugees, will take place Sunday September 14 at the New Globe Theatre 220 Brunswick St, Fortitude Valley.

Featuring Big Iron, Rivermouth, Phil Monsour Band, The Molotov, Andy Dub and more, the concert aims to raise funds for Refugee Action Collective (RAC) and the Refugee and Immigration Legal Service (RAILS).

One artist performing Sunday Phil Monsour is a big advocate of refugees, using his music to spread his message. Songs such as, Who killed Reza Berati? And Next year in Jerusalem are filled with political messages aimed towards policy makers. He will also be launching his album 100 Days at the event.

The concert will start at 3pm and finish at 8pm. Tickets will cost $18 for adults and $13 for concessions during presales and can be purchased at http://events.ticketbooth.com.au/event/RockRootsReggaeforRefugees

Tonight, Adventurous Souls featuring Grace Ruby Herrmann will have its official opening night starting at 6pm, with the exhibition running till the 13^th of September.

“This show explores the turbulent nature of the world contrast against an idyllic Australian lifestyle. Influenced by fantasy and mythology, in mediums of paper carving, woodcarving, gold leaf gilding and oil painting,” says Ms Herrmann.

Also opening tonight outside the gallery is the The Mount Coot-Tha Project featuring Des Rolph. The Brisbane artist has created an exhibition of 42 small oil paintings that takes the viewer on a visual walk around Mt Coot-tha. The intent of this exhibition is to make a historical documentation of the vistas of Brisbane, the local landmarks, and recreational spaces that visitors to this mountain know and love.

While on September 12^th the Ngaaykulam-Patju Tjamuku Kapiliku Jurkurpa (Our Grandfather and Grandmothers Stories) exhibition featuring Papulankutja artists will have its official opening night. The gallery will be filled with artwork from a small community at the base of the Blackstone Ranges, Western Australia. These paintings are rich in stories emanating from their sense of history, culture and place.

For more information on these exhibitions and other upcoming shows, visit www.wag.com.au.