Posted on: 26/06/2018
Falling battery costs are expected to lead to a surge in investment in renewables according to a new report.
A total of $11.5 trillion (£8.7tn) is forecast to be invested in generating power between now and 2050, with $9.9tn of that pumped into zero-carbon options, according to data from Bloomberg New Energy Finance (BNEF).
It predicts $8.4tn will be invested in wind and solar, with a further $1.5bn spent on hydro and nuclear.
Seb Henbest, Head of Europe, Middle East & Africa at BNEF, said: “The arrival of cheap battery storage will mean that it becomes increasingly possible to finesse the delivery of electricity from wind and solar, so that these technologies can help meet demand even when the wind isn’t blowing and the sun isn’t shining.
“The result will be renewables eating up more and more of the existing market for coal, gas and nuclear.”
‘50 by 50’
BNEF’s report calculates that $548 billion will be spent on batteries by 2050, with two-thirds coming at grid level and the rest “behind the meter” in homes and businesses.
The paper said that cheap renewable energy and batteries will “fundamentally reshape the electricity system, as we shift from two-thirds fossil fuels in 2017, to two-thirds renewable energy in 2050”.
Bloomberg expects wind and solar will together account for just under 50% of electricity generation by 2050 – the so-called “50 by 50” point – with nuclear, hydro and other low-carbon sources taking the total up to 71%.
The remaining 29% will come from fossil fuels, down from 63% today.
Electric vehicles boost demand
Coal is forecast to be the biggest loser, with its global share dropping from 38% at present to just 11%.
The cost of solar is forecast to fall by 71% by 2050, with wind down 58% over the same period.
Electric vehicles will add a further 3.5PWh of demand by 2050, equating to 9% of the global total.