- The growth in renewable energy at present is still less than the rise in overall energy demand
- The loss between power demand and renewable energy supply will only broaden as economies travel resumes and reopen, with demand already piercing to pre-pandemic levels
- A “common ground solution” will use traditional fuels for backup when renewable products will not carry through successfully
Growing Renewable Energy – A Plus factor
The world wants to “transition” away from fossil fuels and toward renewable energy, but the harsh reality is that dirty fuels will not go away — or even decline — anytime soon.
The entire amount of available renewable energy is increasing. That’s good news for a world on the verge of catastrophic climate change.
However, the growth in renewable energy is still less than the entire growth in global energy consumption. A “transition” away from fossil fuels may occur in the future, but for the time being, renewable energy isn’t keeping up with expanding energy demand, so fossil fuel demand continues to rise.
“As economies stabilize from the COVID-19 pandemic, the overall power sector is witnessing fast growth in power consumption.” Despite rising renewables capacity, the power produced by renewables remains matchless for amplified demand, as per the manager of global coal and Asia power analytics at S&P Global Platts, Matthew Boyle.
According to Boyle, the global renewable energy supply will increase by 35 gigawatts between 2021 and 2022, while global power demand will increase by 100 gigawatts. To supply the balance of the demand, countries will have to turn to traditional fuel sources. 1 billion watts equals a gigawatt.
The quantity of electricity generated by renewables is expected to rise as well, by 8% this year and more than 6% in 2022, according to the IEA. “Despite these significant gains, renewables are expected to be satisfy only roughly half of projected global demand growth in 2021 – 2022,” it added.
Overall energy shortage; essential backup required
At the same time, spending on oil and gas has decreased as prices have fallen since 2020, and the industry has been under increasing pressure to transition away from filthy fuels. According to the IEA’s World Energy Outlook 2021 study, total spending in 2021 will be just over $350 billion, “far below” 2019 levels. “The world is not investing enough to satisfy its future energy needs,” according to reports.
What it means for climate targets
The International Energy Agency estimates that $750 billion will be spent on clean energy technology globally in 2021, but that figure “remains significantly below” what is needed to meet climate commitments, according to the IEA.
To keep temperatures “far below” a 2 degree Celsius rise in the 2020s, such investment would have to double, and it would have to more than triple to keep it to a 1.5 degree Celsius rise.