China planned 10GW of Solar in 2013, but Installed 14GW Instead

by Joshua S Hill.

China had originally planned for 10GW of installed solar capacity for each of the years 2013, 2014, and 2015, but actually hit 14GW for 2013. Now China has announced that the 2014 target will be 14GW. No word yet on the goal for 2015.
China had originally planned for 10GW of installed solar capacity for each of the years 2013, 2014, and 2015, but may have actually hit 14GW for 2013 (they’re still counting). Now China has announced that the 2014 target will be 14GW. No word yet on the goal for 2015.

Despite predictions all through 2013 suggesting that Japan would walk away the dominant solar PV market, Bloomberg New Energy Finance has revealed that China “outstripped even the most optimistic forecasts” to install a record 12 GW of photovoltaic projects in 2013.

In fact, a massive boom at the end of the year could even have pushed the nation’s market up to 14 GW, a phenomenal feat considering that no country has ever added more than 8 GW in a year.

Bloomberg New Energy Finance (BNEF) had predicted that Japan would come out on top in 2013, ahead of China and then the US, but with a feed-in tariff for large PV projects ending on the first of 2014, the year-end rush will not be wholly understood until March.

“The 2013 figures show the astonishing scale of the Chinese market, now the sleeping dragon has awoken” said Jenny Chase, head of solar analysis at Bloomberg New Energy Finance. “PV is becoming ever cheaper and simpler to install, and China’s government has been as surprised as European governments by how quickly it can be deployed in response to incentives.”

Even China’s state news agency could not have predicted the massive boom which took place. And in July it was announced that China aimed to add 10 GW of solar power a year for the next three years — a target they seem to have hit rather easily.

Surprisingly, many market analysis companies scoffed at China’s targets for 2014. IHS and Mercom Capital both released reports earlier this year suggesting that China would struggle to reach their aim of 12 GW for 2014, but with 2013′s impressive stats, one wonders whether analysts will be revising their predictions in the next few weeks, especially in the wake of new estimations suggesting that China is aiming for 14 GW in 2014.

With the majority of solar projects located on the country’s sunny and empty western provinces, China’s state-owned power generators China Power Investment Corporation, China Three Gorges and China Huadian Corporation have become the world’s largest owners of solar assets.

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This article, China’s Solar Market Beat All Expectations For 2013, is syndicated from Clean Technica and is posted here with permission.

About the Author

Joshua S HillJoshua S Hill I’m a Christian, a nerd, a geek, a liberal left-winger, and believe that we’re pretty quickly directing planet-Earth into hell in a handbasket! I work as Associate Editor for the Important Media Network and write for CleanTechnica and Planetsave. I also write for Fantasy Book Review (.co.uk), Amazing Stories, the Stabley Times and Medium.   I love words with a passion, both creating them and reading them.

Investing In Renewables, Divesting From Fossil Fuels

by Guest Contributor Joe Romm

Energy use by kind of energy.
Energy use by kind of energy.

Originally published on Climate Progress.

Bloomberg New Energy Finance has a must-read piece for investors on how the smart money is beginning to notice the quicksand on which fossil fuel stock prices are built.

We reported back in April that BNEF said 70 percent of new power generation capacity added between 2012 and 2030 will be from renewable technologies (including large hydro).

Indeed, BNEF founder Michael Liebreich posed a good news, bad news story back then:

“By 2030, the growth in fossil fuel use will almost have stopped,” Liebreich told renewable-energy investors…. “We’re told that it needs to happen by 2020” in order to prevent irreversible climate damage. “That won’t happen. But by 2030, it pretty much will.”

Yes, homo “sapiens” will miss by just 10 years or so the window to avert catastrophic climate change — resulting in possibly hundreds of years of misery for billions and billions of people. The tragic irony is the fossil fuel industry is essentially doomed no matter what — but humanity wouldn’t be, if we were just a tad more “sapiens.”

We reported in August that a Goldman Sachs research paper concluded the “window for profitable investment in coal mining is closing” — same for for coal exports.

Now BNEF points out that much the same is true for oil investments:

Last month 70 investors representing $3 trillion of assets under management sent letters to oil-and-gas companies asking them to disclose plans for adapting to a world that may be edging closer to peak fossil fuels. That’s the point when humans stop increasing their annual burn – either because the environmental danger makes it too costly or because buildings and cars run more efficiently. BNEF says peak demand could happen in 2030.

The risk: Oil and coal companies worth more than $7 trillion may be sinking billions of dollars today into projects that will never make sense to finish.

A key point of this article is that it isn’t just enviros saying the days of fossil fuel are numbered. We have institutional investors, Goldman Sachs, Bloomberg New Energy Finance and many, many others in the financial industry:

In 2013, so-called carbon-asset risk “went from a conceptual possibility to a sort of near-and-present reality,” Nick Robins, head of the Climate Change Center at HSBC Holdings Plc in London, said in a phone interview. He wrote a research note in January valuing the risk of “unburnable reserves”: the oil and coal on companies’ balance sheets that will be too expensive to extract. “There is this undertow of demand destruction going on through technological improvement. That’s certainly not fully priced at the moment.”

And that’s without even considering the possibility of the world coming to its senses on the threat posed by unrestricted carbon pollution in time to avert the worst.

There’s more:

“The end is nigh” for global oil-demand growth, proclaimed a Citigroup report in March. Standard & Poor’s cautioned that a patchwork of policies that cut demand for fuels could lead to outlook revisions and downgrades in smaller oil-and-gas companies as early as next year, with a similar shock to the majors in 2016. Goldman Sachs’s advice to oil companies: “invest only in medium-/high-return projects, spend the rest of their cash on buybacks and focus on per share growth.” Translation: prepare to shrink the business.

Divesting from fossil fuels isn’t risky. Not divesting is.

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This article, Investing In Renewables, Divesting From Fossil Fuels, is syndicated from Clean Technica and is posted here with permission.

About the Author

Guest Contributor is many, many people all at once. In other words, we publish a number of guest posts from experts in a large variety of fields. This is our contributor account for those special people. 😀

Grid Parity, Low LCOE Driving 34% Global Renewables Capacity by 2030

by Silvio Marcacci

When it comes to global electricity generation, coal is still king – but not for long

Fast-changing economics mean renewable energy worldwide will represent 34% of all installed capacity by 2030, according to the World Energy Perspective: Cost of Energy Technologies — a report from the World Energy Council (WEC) and Bloomberg New Energy Finance (BNEF).

Global levelized cost of electricity graph via World Energy Council
Global levelized cost of electricity graph via World Energy Council

The report finds many clean energy technologies are already cost competitive with fossil fuels and only getting cheaper, echoing another analysis that found US wind and solar costs fell 50% since 2008. As a result, fossil fuel’s slice of the world energy pie is projected to fall fast, from 67% in 2012 to 40%-45% in 2030.

Falling Renewable LCOE Powers Clean Energy Surge

Vast differences in the cost of building and generating power exist across the globe, but one trend is clear – the levelized cost of electricity (LCOE) continues to fall for mature renewable energy technologies, placing them close to grid parity with fossil fuels. In addition, the cost of producing power from renewables fall continue at a rate related to the level of usage, a trend known as the “experience curve.”

Our study finds that although fossil fuels continue to dominate, renewable energy and the investment appetite for them are growing.

With wider deployment the price of renewables will fall, reducing the risk for investors, and we expect to see greater uptake over the years. — Guy Turner, Chief Economist at BNEF.

The WEC report uses several cost metrics exist to evaluate power generation including capital expenditures, operating expenditures, and capacity factor, but LCOE stands as arguably the most important indicator of renewable energy’s value because it’s the only one that evaluates the total lifecycle costs of producing a megawatt hour (MWh) of power.

LCOE is best explained as the price a project must earn per MWh in order to break even on investment and considers cash flow timing, development and construction, long-term debt, and tax implications to equally evaluate all energy technologies on an equal basis in terms of their actual costs.

But most importantly, LCOE underlines the ascendance of renewable energy across the world – especially wind and solar.

Wind Power Gusts Ahead

Wind power has already become the largest non-hydro renewable electricity source and is projected to more than triple from 5% of global installed capacity in 2012 to 17% by 2030, breezing past large hydropower. From 2000-2010 global onshore and offshore wind capacity increased 30% per year, reaching 200GW installed in 2010.

Onshore wind LCOE by region
Onshore wind LCOE by region graph via World Energy Council

Onshore wind’s LCOE has fallen 18% since 2009 on the strength of cheaper construction costs and higher capacity factors.

Turbine costs have fallen nearly 30% since 2008, outpacing the traditional experience curve.

The LCOE for onshore wind is cheapest in India and China, running between $47-$113 and making well-sited wind farms in these countries among the cheapest in the world – an incredibly important factor considering their surging demand for power is currently being met by coal.

The LCOE picture isn’t as clearly defined for offshore wind, as 95% of the world’s 4GW installed offshore wind capacity is located in European waters.

By 2020 installed capacity growth in Asia will surge, offsetting Europe’s dominance with 40% of all installed annual capacity – China alone will have 30% of all new capacity. As more offshore wind comes online in different markets, LCOE will become clearer.

Solar’s Remarkable Shine

But if wind’s LCOE drop has been steady, solar energy’s has been meteoric.

The WEC reports feed-in tariffs and plummeting photovoltaic module prices make solar competitive with most forms of power generation – in some markets with expensive power, like Germany, businesses with installed solar now find using their generated power more profitable than selling it to the grid.

Solar power LCOE over time chart via World Energy Council
Solar power LCOE over time chart via World Energy Council

As a result, solar power’s worldwide capacity will absolutely boom, growing from 2% of installed capacity in 2012 to 16% by 2030. China and Japan will be biggest beneficiary of solar’s rise, with China set to exceed 50GW installed solar by 2020.

The WEC’s forecast for solar power is incredible, but even this outlook is underestimates solar’s clean energy potential, because it only includes projects above 1 megawatt in capacity – completely ignoring the spread of small-scale rooftop solar and the rise of distributed generation

Solar power LCOE by region graph via World Energy Council
Solar power LCOE by region graph via World Energy Council
Fossil Fuel’s Achilles Heel: Operational Costs

In spite of falling renewable costs, fossil fuel generation is still cheaper in most regards, except for one – the price of operation.

The WEC notes that once renewables are built and online, their costs are mainly marginal operational and maintenance expenses. Compare that to fossil fuels, whose costs are volatile and subject to change from factors like commodity price swings and external costs like carbon pricing and pollution.

This trend is most clearly seen in developed nations like Western Europe, America, and Australia, where the WEC says the potential for significant amounts of new coal generation to come online is low.

Today, developing nations buck this trend and coal is a growing generation source in Brazil, China, and India. In fact low capital costs make China the cheapest country to generate power from coal, less than half the LCOE in Europe or the US.

Coal LCOE by region chart via World Energy Council
Coal LCOE by region chart via World Energy Council

But the tide is starting to turn, evidenced by growing concerns about air pollution in China and the development of carbon markets in many of the world’s developing economies where fossil fuels have dominated generation.

Grid Parity For Renewables Fast Approaching

Put it all together, and it’s clear to see global energy economics are changing fast.

While coal still dominates global electricity production, renewables are catching up with net investment growing seven-fold from 2004-2011, outpacing fossil fuels for the second year in a row in 2012. And as more renewables come online, their costs continue to fall faster and faster from larger economies of scale.

The cost of most technologies, and most dramatically that of solar PV, is coming down with production scale-up in many areas of the world.

With such growth, grid parity will become reality in the coming years. — Dr. Christoph Frei, World Energy Council Secretary General

This article, Grid Parity, Low LCOE Driving 34% Global Renewables Capacity by 2030, is syndicated from Clean Technica and is posted here with permission.

About the Author

Silvio Marcacci is Principal at Marcacci Communications, a full-service clean energy and climate-focused public relations company based in Washington, D.C.

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A Cleaner Future For China Lays Ahead

by Joshua S Hill – Special to JBS News

Coal’s dominant share of China’s power capacity is set to slowly erode over the next twenty years, thanks primarily to the growth of the country’s renewable sector, in particular large hydro, which will account for more than half of new power plants before 2030. And while China’s power capacity is expected to more than double by 2030, estimates suggest it’s carbon emissions could be in decline by 2027.

These findings are part of a new report released by Bloomberg New Energy Finance (BNEF), entitled ‘The Future of China’s Power Sector: From centralized and coal powered to distributed and renewable?’

BNEF expects an additional 88 GW of new power plants annually [in China] from now until 2030, which would be the equivalent of building the United Kingdom’s total generating capacity once a year.

Unsurprisingly, China is currently the world’s largest power producer (and subsequently, the world’s largest carbon emitter), and could end up installing 1,500 GW of new generating capacity over the next two decades, and investing more than $3.9 trillion in power sector assets. However, and happily, because of China’s focus on renewable energy, their total power sector emissions could start declining in 2027.

“China has started to change course towards a cleaner future,” said Jun Ying, country manager and head of research for China at Bloomberg New Energy Finance. ”But despite significant progress in renewable energy deployment, coal looks set to remain dominant to 2030. More support for renewable energy, natural gas and energy efficiency will be needed if China wants to reduce its reliance on coal more quickly.”

Due in part to their reliance upon manufacturing, China has made large strides in the renewable energy sector, specifically in the solar and wind industry. This has led to an industry-leading manufacturing infrastructure, supplying great swathes of the world’s photovoltaic and turbine products. Unsurprisingly, while economically beneficial to China, this industry leadership has also benefited the country’s power mix, especially in light of the need to minimize the horrific amounts of coal-based carbon emissions the country has been pumping into the atmosphere.

Bloomberg New Energy Finance analyzed China’s power sector based on four separate scenarios — Traditional Territory, New Normal, Barrier Busting, and Barrier Busting with Carbon Price. The central scenario (New Normal) sees China’s total power generation capacity more than double by 2030. Together with an increase in renewables (featuring large hydro) enough to supply more than half of all new capacity additions, the scenario saw an increase in gas-based generation, which would drive the share of coal-fired power generation down from 67% in 2020 to 44% in 2030.

Even in the New Normal, however, coal’s production capacity is still set to grow rapidly until 2020, adding an average of 38 GW per year. Following 2020, coal will see smaller growth — only 10 GW per year — until 2030. Due to the longevity of China’s coal industry, the country’s carbon emissions and atmospheric problems causing poor air quality will continue through the next 10 to 15 years, and could take many more before any considerable beneficial effects are seen.

The remaining three categories are described as follows:

  • Traditional Territory — which sees a heavier reliance on coal and fossil fuels
  • Barrier Busting — in which barriers to the adoption of clean technologies are systematically eliminated by policy-makers
  • Barrier Busting with Carbon Price — which includes the above category and then includes a carbon price.

Commenting on the final scenario, BNEF noted that they believe themselves to be the first to produce “…the world’s first forecast of a Chinese carbon price, based on stated national goals for emission abatement.”

Specifically; An average carbon price of CNY 99/tCO2e ($16/tCO2e) will result in 23% fewer new coal plants being built compared to the New Normal scenario. The difference would be made up by more renewables and natural gas. The sector’s carbon peak would arrive four years sooner as a result, in 2023.

“The wide range of outcomes in our scenarios demonstrate the extreme uncertainty facing China’s energy sector,” said Milo Sjardin, head of Asia Pacific at Bloomberg New Energy Finance. ”The future depends on a number of big questions, questions on which one can still only speculate: the cost at which China may be able to extract its shale gas reserves, the potential impact on fracking and thermal generation of water constraints; and potential accelerations in climate and environmental policy, including a potential price on carbon.”

“It is hard to underestimate the significance of China’s energy consumption growth and its evolving generation mix,” said Michael Liebreich, chief executive of Bloomberg New Energy Finance. ”The impacts will reach far beyond China and have major implications for the rest of the world, ranging from coal and gas prices to the cost and market size for renewable energy technologies – not to mention the health of the planet’s environment.”

This article, A Cleaner Future For China Lays Ahead, is syndicated from Clean Technica and is posted here with permission.

About the Author

I’m a Christian, a nerd, a geek, a liberal left-winger, and believe that we’re pretty quickly directing planet-Earth into hell in a handbasket! I work as Associate Editor for the Important Media Network and write for CleanTechnica and Planetsave. I also write for Fantasy Book Review (.co.uk), Amazing Stories, the Stabley Times and Medium.   I love words with a passion, both creating them and reading them.
 

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Royal Dutch Shell Drops Two ‘Bombs’ in One Week

Royal Dutch Shell Drops Two ‘Bombs’ in One Week | 01/03/13
by John Brian Shannon John Brian Shannon

First came the announcement this week by Shell senior executives that oil extraction in the Arctic would be postponed for the second year in a row, and second is yesterday’s announcement foreshadowing the company’s plan for the future, Shell Sees Solar As The Biggest Energy Source After Exiting It in 2009.

The New Lens Scenarios Europe Shell report depicts two different energy policy scenarios, predicts that “photovoltaic panels will be the main power source by 2060 or 2070”  (depending on which scenario) and “lower costs and state support will boost solar to about 600 gigawatts in 2035” – worldwide totals.

What might lie ahead 50 years from now… or even in 2100? We consider two possible scenarios of the future, taking a number of pressing global trends and issues and using them as “lenses” through which to view the world.

The scenarios provide a detailed analysis of current trends and their likely trajectory into the future. They dive into the implications for the pace of global economic development, the types of energy we use to power our lives and the growth in greenhouse gas emissions.

The scenarios also highlight areas of public policy likely to have the greatest influence on the development of cleaner fuels, improvements in energy efficiency and on moderating greenhouse gas emissions.

Mountains

The first scenario, labelled “mountains”, sees a strong role for government and the introduction of firm and far-reaching policy measures. These help to develop more compact cities and transform the global transport network. New policies unlock plentiful natural gas resources – making it the largest global energy source by the 2030s – and accelerate carbon capture and storage technology, supporting a cleaner energy system.

Oceans

The second scenario, which we call “oceans”, describes a more prosperous and volatile world. Energy demand surges, due to strong economic growth. Power is more widely distributed and governments take longer to agree major decisions. Market forces rather than policies shape the energy system: oil and coal remain part of the energy mix but renewable energy also grows. By the 2060s solar becomes the world’s largest energy source. – Shell

According to information compiled from Bloomberg New Energy Finance and the International Energy Agency, solar photovoltaic (PV) capacity has grown to about 102 gigawatts worldwide in 2012 – which is up from 1 gigawatt globally in 2000.

Since year 2000, an average of 10 gigawatts of PV solar, per year, has been very unevenly added to the world’s electrical grids, but if PV solar installations were to grow at the same rate as the 2000-2012 timeframe, just 450 gigawatts of PV solar would be installed by 2035 — not the 600 gigawatts predicted by the report. The growth rate for PV solar has been astonishing for a new kind of energy for utility companies — and additionally so, considering it is battling with the big boys of the energy world, oil & gas, coal and nuclear. Regardless of past challenges, strong growth in PV solar is forecast until 2100.

All of this means that PV solar is set to grow dramatically between now and 2035, let alone by 2070.

Peter Endig/dpa via AP Images
Shell Solar GmbH 2004 | World’s then-largest solar power plant in Espenhain, Germany | Image credit courtesy: Peter Endig/dpa via AP Images

The report has PV solar power moving to number one position to provide at least 38% of worldwide energy supply (well up from today’s ranking of 13th place) to become the predominant kind of energy by 2100.

By 2100, energy from oil will account for only 10% of worldwide energy use and natural gas will account for just 7.5% of the worldwide total, Shell said.

Due to enhanced Carbon Capture and Storage, clean combustion technology and the use of CO2 gas for industrial processes by 2100, Shell sees “global emissions of carbon dioxide dropping to near zero by 2100”.

As all of the above plays out, natural gas demand is expected to surpass the historic demands seen for any other kind of fuel and the quote from the report’s main authour Jeremy Bentham, speaks volumes about the anticipated level of demand for the gas.

“The underlying pent-up demand for gas is very strong…we see it being sucked up, every molecule.”– Jeremy Bentham

The overall demand for energy will double in the next 50 years due to population growth and increases in living standards, and natural gas will eventually enjoy the highest level of fuel demand in history. But by 2100, the world will mainly run on PV solar, while other kinds of energy will contribute small percentages to the overall global energy mix.

It now appears that Shell would rather ‘switch than fight’ the move to PV solar. It is likely to be the first of many such switches in the global energy industry.

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