A new report out by the World Energy Council, World Energy Scenarios 2016: The Grand Transition, found that the even as the demand for electricity worldwide will double by 2060, wind and solar power could provide up to 39 percent of the world’s energy supply under its “Unfinished Symphony" scenario. That’s despite solar and wind now accounting for roughly 4 percent of the world’s power generation.
The “Unfinished Symphony” scenario is one of three that the report, co-developed by Accenture Strategy and the Paul Scherrer Institute with the council, outlines regarding the future of energy use in the world. The other two scenarios, it called “Modern Jazz” and “Hard Rock” see less renewable energy in the future, 30 percent and 20 percent, respectively.
Under the symphony scenario, the most favorable scenario for renewable energy and the world, the report found that strong policy, as well as more hydro and nuclear generation capacity, will allow wind and solar power to reach nearly 40 percent of the world’s energy supply. To enable such a high degree of intermittent renewables, the report also stated other forms of energy storage, including pumped hydro, compressed air and battery innovation will be needed to balance the intermittency of wind and solar. Under the least favorable scenario, the rock scenario, the development of wind and solar would be hampered by inward-looking policies and weaker and unsustainable economic growth.
“It is clear that we are undergoing a grand transition, which will create a fundamentally new world for the energy industry,” said Ged Davis, executive chair of scenarios with the World Energy Council. “Historically people have talked about peak oil but now disruptive trends are leading energy experts to consider the implications of peak demand.” Ratifying the Paris Climate Accord show that countries are willing to take action, but they will have to start acting on their plans to make the symphony scenario possible.
The research determined that the world is likely to reach peak per capita energy demand before 2030. It said: “This is in stark contrast to historic growth levels, which have seen global demand for energy more than double since 1970. Technological innovation, government policies and lower growth expectations will have a significant impact on the sector in the coming decades.” The scenarios also show that fossil fuel will remain an important part of the world’s energy supply as well although its use fall to as low as 50 of the world’s energy mix by 2060.
“By 2060, all scenarios point to an increase in demand for gas, as well as a possible peak demand for oil within the 2035-2045 timeframe,” added Nuri Demirdoven, Managing Director at Accenture Strategy. “Misspending including misallocation of capital has always been a risk for energy assets, and will continue to grow due to fundamental shifts in the industry. Leading companies across all scenarios will be those that adapt quickly and take two urgent steps: rethink the balance of their energy portfolio, and utilize business and digital technologies to transform how they deliver work and organize and manage performance across their businesses.”Tweet