MARKET DRIVERS IN RENEWABLE ENERGY
The future growth in renewable energy generation will be driven by a number of factors. These factors include the rate of technological improvement and innovations, manufacturing scale economies, government incentives and regulations and the cost of competing electricity generation methods. A series of accelerating trends give a positive directional indication for the renewable energy industry, including:
- significant reduction in the cost of clean energy technologies
- improved capacity factors and output efficiency of renewable generation resources, driven by technological advances
- renewable electrical generation sources increasingly located at a customer’s point of delivery because it is less expensive than the utility company alternative
- increased utility company cost structure associated with the replacement of aging conventional power generation facilities and transmission and distribution charges
- energy consumers’ desire to lock in predictable long- term energy cost combined with renewable energy’s ability to avoid the risks of price volatility and market disruptions associated with conventional fuel sources
- increasing concerns over conventional power generation, driving increased regulatory barriers and challenges to obtaining and maintaining applicable permits
- government policies that encourage the development of renewable energy, such as: renewable portfolio standard programs, tax credits and subsidies for the cost of renewable energy production.
According to the lnternational Energy Agency (IEA), global energy consumption is expected to increase by 37% from 2015 to 2040, and renewable energy consumption expected to account for nearly half of the global increase in power generation by 2040 overtaking coal for the leading source of electricity. The increase in scale, efficiency and technological innovation has resulted in renewable energy becoming increasingly cost competitive.
Solar PV is one of the fastest-growing sources of new electricity generation. Solar energy offers several operational advantages:
- it is reliable and predictable energy output
- it hass low and predictable operational and maintenance costs
- it is lower risk than other energy sources due to minimal asset complexity and use of proven technologies
- it does not face ongoing commodity risk.
These factors, combined with the government incentives and regulations in place in many parts of the world, have resulted in a subsidized environment that has fostered a significant reduction in the cost of constructing and generating solar energy. The result has been rapidly decreasing solar energy systems costs.
Wind energy has been a rapidly growing source of electricity generation globally over the past decade. Increasing competitiveness of wind energy technology is improving as a result of taller towers, longer blades and more efficient energy conversion equipment, allowing wind projects to more efficiently capture wind resources and produce more energy. Technological improvements are rapidly making wind turbines more productive and cost efficient while expanded manufacturing is achieving economies of scale.
Biofuels (particularly ethanol) is a significant and growing portion of the world’s fuel infrastructure. Biofuels are environmentally friendly and cost effective. They can be manufactured from a wide range of crops and other organic materials including crop waste, manure, and other byproducts. Biofuels can be easily produced as new crops are grown and waste material is collected. They can be produced locally decreasing any given country’s dependence on foreign sources of oil. Demand for biofuels will continue to grow as countries globally target higher ethanol blends for lower emissions, better octane ratings and diversification from oil.
energy storage market
With the growing demand for energy worldwide, the market for energy storage has witnessed a boom in recent years. Devices that can store energy for using at a later time have developed rapidly to meet the rising requirements for energy. Companies and governments worldwide are facilitating the growth of energy storage devices due to their capability of storing electricity more effectively and efficiently.
Increased penetration of low-carbon technologies, distributed generation and greater intermittency in the energy mix are causing higher peak demands gap, thermal and voltage constraints and less predictable load and generation cycles are all creating the need for a solution that provides stability and reliability to fluctuating energy supply. Energy storage is the complementary technology that works alongside renewables to meet these challenges.
Global Biomass Energy Market
Biomass is a significant resource for renewable energy globally. It is derived from principal resources such as forestry, biogenic waste and agricultural products. Electricity can be generated by direct combustion or by converting biomass into fiber or industrial chemical. As the economics have improved for energy production from biomass, along with growing concerns about greenhouse gas emissions, biomass energy is becoming an increasingly attractive option.
Biomass offers an advantage over other renewable resources such as solar, wind and hydropower in that it is a base load resource. Biomass is one of the only renewable fuels which offer viable alternate to coal-based generation. It is also much more environmentally friendly to produce than traditional energy generating sources like coal and gas.