Insights from the IEA 2019 World Energy Outlook
The International Energy Agency (IEA) recently released its annual report, called the World Energy Outlook 2019, and it illuminates several interesting insights for electric utilities. In today’s post I’ll be highlighting a few of the insights that are relevant for utility emergency preparedness.
3 Important World Energy Outlook Takeaways
One of the biggest takeaways from the report is the impact of renewable energy sources on the go-forward power mix. This encompasses a predicted explosion in the growth of solar and wind energy.
Forecasts from the World Energy Outlook predict that electricity produced from solar power could eclipse coal and gas in just 15 short years, growing to an estimated 13% of global generation capacity by 2040. Similarly, wind power is expected to account for another 13% of the total by 2040, and offshore wind projects in particular are expected to see double digit capacity growth in the coming decades. This growth will be fueled, according to the report, by efforts to combat global warming.
Another interesting insight is that efforts to expand gas infrastructure are likely to decline going forward, mainly due to the growing interest in electrification. This trend is also driven by climate fears, as electrification produces fewer emissions at the point of use. That said, the report notes that this shift will not happen as quickly as some people might like, as it will require expensive and time-consuming changes to the existing electricity infrastructure.
Finally, despite all of the climate-fear-induced investments, the World Energy Outlook expects coal power to continue to remain prevalent around the world. Almost one third of global coal plants are more than 25 years old, but it is not feasible to replace this capacity right now because it would leave many countries “short of sufficient supply and significantly compromise electricity security.” Instead of coal plant retirement, the report suggests that retrofitting existing coal plants in order to reduce their carbon emissions is the way to go.
The bottom line is that the utility industry is in the midst of a paradigm shift, and this evolution is paramount to the predictions outlined in the 2019 World Energy Outlook. Interesting stuff!
