Global emissions are very close to peaking
The masters of the renewable universe, gathered at the New Energy Finance summit this week, were adamant: Net Zero is happening, come what may.
The masters of the (renewable) universe were gathered this week at Bloomberg’s New Energy Finance summit which was being held at a smart hotel in London’s West End. There were no climate sceptics here – everyone was in no doubt about the need for Net Zero and reducing emissions. But the conference was not attended by hemp-wearing, muesli-munching members of the anti-growth coalitions. No, these guys meant business and business suits. Hang on, these guys are business and mighty impressive they are too. When Kemi Badenoch says she’s sceptical about Net Zero, she’s a long, long way behind the curve – and the money.
Consider the following statistics that were published at the conference:
Of power capacity additions in 2023, 94% came from renewables; 91% came from wind and solar; 6% came from fossil fuels.
Bloomberg forecasts that solar power globally will grow 2.9 times from 2024 to 2030 to just under 7 terawatts (TWs) of installed capacity in 2030. One TW equals 1000 gigawatts (GWs). By way of comparison, on a very cold day in the UK, peak demand is around 48 gigawatts.
Bloomberg also forecasts that global wind power will grow 1.8 times to just over 2 TWs by 2030.
Global energy storage capacity has grown nine times since 2020 and is expected to grow a further five times by 2030 to 800 gigawatts.
China has enough solar panel manufacturing capacity to service global demand on its own and is the world leader in renewables deployment. They will account for 60% of the expansion in global renewable capacity by 2030.
Today, the International Energy Agency reported that the world will add 670 GWs of renewable power in 2024 and is set to add a further 5,500 GWs of renewable power by 2030. By then, renewable sources will be generating 46% of the world’s power. China, India, the EU and the US are all leading the way. And all this in the same week that the UK shut down its last coal-fired power station.
So, if you’re uncertain about all this, you’re swimming against a fast-rising tide. The Bloomberg conference was very clear that Net Zero is happening come what may and it’s only going to accelerate. Governments want it and they’re putting in the carrot (incentives in the US) and the stick (regulation in the EU) to make it happen. And there’s a lot of commercial capital around to support the efforts of governments.
That’s not to say that it’s simple and there aren’t trade-offs. Going renewable doesn’t mean you are emissions-free – those turbines and panels still have to be fabricated and shipped and installed, all of which have their own costs in carbon terms. But it’s also the case that global emissions are very close to peaking, if they haven’t peaked already and this trend will continue as this new capacity comes online.
How do we know? Because we’ve seen it in our own country. There’s a strong case to say that the UK has offshored many of its own emissions, it’s still undeniable that UK’s carbon footprint fell 24% from 922 Million tonnes of carbon dioxide equivalent (Mt CO2e) in 1990 to 705 Mt CO2e in 2021 with the peak of emissions happening in 2007. This has much to do with our power sector: 30 GWs of coal-fired capacity when Ed Miliband first became energy secretary in 2008; 0 GWs of coal-fired power capacity when he got his old job back in 2024. Has he thanked the Tories for that particular legacy?
It’s not all roses though. If you are an investor in Green Hydrogen, you could be forgiven for looking pretty gloomy. It looks like this market is going to tank and tank fast because the industry can’t find anyone to commit to long-term offtake contracts. No offtake means there’s no production. And there’s “a little cloud no bigger than a person’s hand rising out of the sea” that everyone has begun to talk about: data centres.
It turns out that the cloud is not actually a cloud but is banks and banks of computer systems that need stable power to operate and to be cooled. As the cloud expands and AI and quantum computing gets going, demand for power is only going to massively increase. Lucky then that it looks like, from the financial muscle represented in London this week, that we have our best and best-financed people on the job.
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