Renewable energy is a major focus for national governments and big businesses alike, especially amidst an increasing emphasis on combating global climate change. This news update brought to you by Ideal Power offers a round-up of just some of the most eye-catching headlines around renewable energy and the market opportunities associated with them.
This month, we’re celebrating a milestone in California, which briefly generated 100% of its energy needs from renewable energy sources. In addition, a major Japanese railway announced it is now running exclusively on renewable energy. Finally, a McKinsey report projected that half the world’s power will be derived from renewable energy sources by 2050, but urged for accelerated adoption. Here’s a closer look at each of these developments.
California produces 100% of energy needs from renewables in major first
The State of California reached a significant milestone in its renewable energy production on April 30, briefly meeting 100% of the statewide demand for energy from renewable sources. The lion’s share of energy production was reportedly credited to solar power facilities along Interstate 10, according to state officials.
"Once it hit 100%, we were very excited," Laura Deehan, executive director for Environment California, told USA Today. "California solar plants play a really big role."
The milestone is a first for any state in the U.S. California is currently targeting the year 2045 to meet 100% of energy demand from clean energy sources on a sustained basis.
Tokyu, a leading Japanese railway company, now fully powered by renewables
Tokyu, the Japanese-based railway company that maintains a massive network of train lines throughout Tokyo and the surrounding region, announced it no longer produces any carbon dioxide emissions. The railway giant reached the milestone of 100% renewable energy on April 1, ensuring its more than 100 kilometers of railway track is traversed by its trains in a carbon-neutral manner.
Tokyu became the first-ever railroad operator in Japan to reach this goal, according to VOA News. To do so, the company leveraged hydrogen, geothermal, wind, and solar power.
Japan is the world’s sixth-largest producer of carbon emissions and currently maintains a goal of running on 100% clean energy by 2050. Currently, only about 20% of the country’s energy production comes from renewable energy sources, according to the nation’s Institute for Sustainable Energy Policies. Japan is currently targeting between 36% and 38% of its energy production to come from renewable resources by 2030.
Roughly 50% of global energy supply will come from renewables by 2050, McKinsey reports
An annual McKinsey report entitled Global Energy Perspectives, which analyzes the adoption of renewable energy resources, projected that half the world’s energy needs will be met by renewable sources by 2050. According to the report, between 26% and 43% of energy generation would come from solar and onshore wind production, while the remainder would come from offshore wind, hydrogen, and geothermal sources.
“Rapid technological developments and supply chain optimisation have collectively halved the cost of solar, while wind costs have also fallen by almost one-third,” McKinsey senior partner Christer Tryggestad said in the report. “As a result, 61% of new renewable capacity installation is already priced lower than fossil fuel alternatives.”
The report also notes that global energy consumption is expected to triple between 2022 and 2050, making the rapid adoption of renewable energy all the more important. In 2021, a record 10% of the world’s power was generated by wind and solar production facilities, emphasizing the pace at which renewable energy sources are gaining prominence.
Still, McKinsey warned that to keep climate change in check, the pace of adoption should be accelerated even further. According to the report, the current energy transition projections have the Earth’s atmosphere warming by 1.7°C heating by 2100, significantly greater than targets set under the Paris Agreement, an international treaty on climate change mitigation. The report projects that carbon emissions will peak before 2030, but at the current rate maintaining atmosphere warming below 1.5°C would require quicker expansion of renewable energy sources “aggressive regulatory constraints on the carbon intensity of fuels.”
Renewables outlook remains strong despite new challenges
The long-term outlook of the renewables market remains bright. Analysis performed by Allied Market Research estimates that the space will grow in market value from $882 billion in 2020 to $2 trillion by 2030, an 8.4% compound annual growth rate (CAGR). Deloitte anticipates the major driving factors of this growth include increased innovation in technology, improved infrastructure development, and declining costs in renewable energy technology.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dan Brdar
Dan Brdar is the President, CEO and a Director of Ideal Power. He has over 30 years of experience in the power systems and energy industries and has held a variety of leadership positions during his career. In addition to his role at Ideal Power, Dan previously served as President and CEO of FuelCell Energy Inc., a Nasdaq-listed company with a market cap of over $250 million.
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