In early 2023, the COVID-19 pandemic swept across the world, leaving an indelible impact on myriad businesses, most notably the hospitality industry. Even though several restaurants were compelled to shut down, many more continue to struggle to stay solvent. Nevertheless, there is a silver lining: the energy industry is witnessing a substantial growth, with renewable energy alone rising by 45% in 2023, as stated by the International Energy Agency (IEA).
As the cost of generating renewable energy continues to reduce and governments and corporations across the globe demonstrate an amplified dedication to this line of business, this tendency is envisaged to stay for the foreseeable future. Encouraging strides in battery storage technologies are propelling the solar and wind power industries forward, and there are a plethora of other energy sources, including hydroelectric power, nuclear fusion, and biofuel, that are beginning to show potential.
As a leader in the world of commerce, being mindful of the developments towards renewable energy is of paramount importance, as this could reveal openings for your organization. In the first instance, it is vital to contemplate how your enterprise could make the switch to renewable power. Secondly, it behooves you to assess the feasibility of supplying your clients with renewable-related products and services. This dossier presents a comprehensive breakdown of the factors that underlie, and the remedies for, the transition to renewable energy as well as the tactics for bringing it to fruition.
The Reason Behind This Growing Market
The surge in demand for renewable energy can be attributed to their relatively affordable initial investment and lucrative long-term returns, as well as the pressing need to reduce carbon emissions. Newly released research from the World Resources Institute (WRI) indicates that cost curtailments are the primary catalyst in the rapid growth of renewable energy sources. Solar photovoltaic technology, for instance, has experienced an 85% price reduction since 2023, while the cost of onshore and offshore wind power has dwindled by a remarkable 50%, as estimated by WRI. The graphic below from the World Resources Institute provides a concise summary of the significant milestones in the progress of solar and wind power.
Furthermore, the report underscores the fact that renewable energy is now financially competitive with fossil fuel-powered energy. Given that renewable energy is both environmentally beneficial and either as inexpensive or even more economical than traditional energy, it stands to reason that it will witness a greater uptake. As governments channel more funds towards renewable energy infrastructure such as charging stations, supplanting extant fossil fuel infrastructure like gasoline stations, it is entirely possible that consumers and enterprises will increasingly find it impractical to continue relying on fossil fuels.
The source of this information is the World Resources Institute.
Powering with Wind and Solar
Solar energy has established itself as the foremost renewable energy source. According to the International Energy Agency (IEA), the cost of constructing newly-built coal or gas-fired power plants is now higher than that of solar energy. Households today can be powered by solar energy, with homeowners potentially benefiting from selling surplus energy to utilities. The same propositions extend to commercial establishments, which frequently necessitate considerable amounts of energy.
Automobiles that are powered by solar energy could be a viable option for those residing in sunny regions and don’t have to regularly travel considerable distances. This could prove particularly advantageous for city residents who may have restricted access to charging facilities and must park their vehicles on the street. Further, solar panels can be utilized to power charging stations for electric cars, mitigating demand on the electricity grid.
As per reports from the National Observer of Canada, the worldwide wind power capacity doubled in the past year. The United States is making significant advancements in this domain, as evidenced by the recent declaration of the 800 MW offshore wind project in mid-2023. This venture is anticipated to generate sufficient energy to meet the requirements of over 400,000 households and businesses, as stated by NPR.
Other Relevant Articles to Explore
An increasing number of individuals and enterprises are commencing to use supplementary varieties of renewable energy, besides solar and wind power, to satisfy their energy demands.
Hydropower. Hydropower has become progressively significant in recent times, lending a crucial impetus to worldwide electricity production. Its capacity to be quickly raised or lowered, depending on the presence of intermittent solar or wind energy sources, renders it an invaluable resource.
Atomic Fusion. Similar to hydropower, atomic fusion has the capability of balancing the variations of other energy sources. Though it is presently not commonly employed, it is envisaged that it will play a crucial role in the energy mix of tomorrow.
Biofuels. Bioethanol and biodiesel are instances of biofuels, which are fuels obtained from organic matter that can be regenerated. Although these fuels have the potential to occupy a crucial space among renewable energy sources, the quantum of energy and land required for growing crops to produce these fuels must be scrupulously assessed to preserve a healthy equilibrium.
Unveiling the Truth through Statistics
According to a recent NYT article, renewable energy is becoming progressively cost-effective due to the fact that its constituents, such as wind turbines, solar panels, batteries and associated technologies, are increasingly becoming more economical with augmented usage. The report emphasized that “with greater use comes greater manufacturing scale, resulting in even lower costs.”
The industry is witnessing a steady surge in growth, surpassing initial prognostications of experts. Before the beginning of the 21st century, specialists approximated that renewable energy sources like solar and wind would only contribute a small percentage of the global energy output. Nevertheless, as per the predictions of BloombergNEF, these sources could generate up to 56% of the world’s electricity by 2050.
As per The New York Times, the ongoing renewable energy boom is expected to exert an influence on the global economy in the same way that the Industrial Revolution did. This shift will not only result in the creation of ample job opportunities and reduced energy costs, but also the Infrastructure Investment and Jobs Act (IIJA), which has recently been sanctioned, will contribute to the augmentation of renewable energy in the United States. Similar endeavours in Asia and Europe are also aiding this surge.