Three energy trends are shaping today’s rapidly evolving power industry, but it’s impossible to tease apart their impacts. The trends — decarbonization, vehicle electrification, and energy access—intersect and interact while they bring about a dramatic global transformation.
THE TREND: De-carbonisation – Dropping Costs and Increasing Penetration of Renewables.
In response to climate change, the power sector is working to reduce greenhouse gas emissions through the steady adoption of renewable energy. Increased acceptability, favorable policies, and falling costs are all contributing to renewables’ rise.
The TREND: Vehicle Electrification – Balancing Demands
Reasons for buying electric vehicles are vary from lower fuel costs to reduced environmental impacts. Worldwide registrations of electric vehicles hit 750,000 in 2016, with China accounting for more than 40 percent of EVs sold and the United States only half that. China’s predominance is no surprise, given that coal-fired plants have left the country choked with environmental pollution. Utilities can expect a defining moment in their futures: a jump in peak electricity demand due to Electric vehicles. By the 2020s, the cost to operate an electric vehicle should be on par with that of greenhouse-gas-emitting internal combustion vehicles in all but regions with the most coal-heavy power generation.
THE TREND: Energy Access – Bringing Electricity to Over 1 Billion People
Currently, 1.1 billion people, mainly in sub-Saharan Africa and south Asia, still do not have access to electricity. City dwellers are mostly covered, but some 27 percent of rural residents lack electricity. This deprivation hampers their economic and social development. Achieving universal energy access is a 2030 UN Sustainable Development Goal. Providing energy would improve the quality of life and economy of these communities by allowing shops and businesses to stay open after dark, improve health care access, and even make simple things possible, like study and sports after school. But meeting the UN goal requires not just bringing in electricity, but also improving energy efficiency and increasing clean energy.
These energy trends promise to drive out carbon emissions from the power supply, deploy cost-effective technologies to generate electricity, change the equation for greenhouse gas emissions and oil demand, and bring electricity to 15 percent of the world’s population. As a plant manager, the most important way to prepare for this change is to identify opportunities that these energy industry trends present—before they disrupt your business.