Wind and solar energy will rise from 7% of the world’s energy supply to 48% by 2050, according to a new report by Bloomberg New Energy Finance (BNEF). BNEF states in its ‘New Energy Outlook 2019’ (NEO) that this is due to the significant cost reductions of the two energy sources.
As a matter of fact wind or solar now represent the least expensive option for adding new power generation capacity in approximately two-thirds of the world.
BNEF predict that energy demand will grow by 62% by 2050, attracting investment of $13.3tn. Of this, wind power will attract $5.3tn and solar $4.2tn. Outside of these investments, battery technology could receive $840bn and grid expansion will attract $11.4tn in new investment.
Meanwhile fossil fuels will go into significant decline, coal will fall from 37% to 12% while oil will be “virtually eliminated” as a source of energy. Hydro, nuclear and natural gas will remain at the same levels.
The group also predicted that Europe would be the fastest region to decarbonise its grid, with 92% of its electricity coming from renewables by 2050. China and the US will decarbonise slower, due to China’s coal-fired plant capacity and the US’ “abundance” of liquid natural gas.
Because of its coal plants, China’s emissions are predicted to peak in 2026 and then fall by 50% in the following 20 years. In the US, renewables will double but only to 43% by 2050.
In a tweet announcing the release of the report, the company highlighted the importance of battery technology, writing: “Batteries complete the triumvirate of new technologies that will transform the electricity sector over the next 32 years.”
Bloomberg NEO lead analyst Matthias Kimmel said: “Our power system analysis reinforces a key message from previous NEOs that solar photovoltaic modules, wind turbines and lithium-ion batteries are set to continue on aggressive cost reduction curves.
Bloomberg’s NEO director Seb Henbest said that the report’s analysis “suggests that governments need to do two separate things – one is to ensure their markets are friendly to the expansion of low-cost wind, solar and batteries; and the other is to back research and early deployment of these other technologies so that they can be harnessed at scale from the 2030s onwards.”