The forecast notes that electricity demand will be boosted by at least 8% in 2040 owing to the increase of electric vehicles.
[quote] A Bloomberg release says that coal and gas prices will continue to remain relatively low, but “will fail to prevent a fundamental transformation of the world electricity system over coming decades towards renewable sources such as wind and solar, and towards balancing options such as batteries.”
The New Energy Outlook 2016 demonstrates a marked decrease in global coal, gas and oil prices than did the equivalent projection a year ago, but shows a steeper decline still for wind and solar costs.
Seb Henbest, head of Europe, Middle East and Africa for BNEF, and lead author of NEO 2016, commented: “Some US$7.8 trillion will be invested globally in renewables between 2016 and 2040, two thirds of the investment in all power generating capacity, but it would require trillions more to bring world emissions onto a track compatible with the United Nations 2°C climate target.”
Tackling carbon emissions
The forecast reveals mixed news on carbon emissions over the forecast period (2016-2040). It says that the weak GDP growth and rebalancing economy in China will see emissions “peak as early as 2015.”
It goes on to say that, “rising coal-fired generation in India and other Asian emerging markets indicate that the global emissions figure in 2040 will still be some 700 megatonnes, or 5%, above 2015 levels.” [EC proposes 40% emission reduction, 27% renewables targets for 2030]
Jon Moore, chief executive of Bloomberg New Energy Finance, said: “The New Energy Outlook incorporates a significantly lower trajectory for coal and gas prices than the 2015 edition did a year ago but, strikingly, still shows rapid transition towards clean power over the next 25 years.”
Elena Giannakopoulou, senior energy economist on the NEO 2016 project, added: “One conclusion that may surprise is that our forecast shows no golden age for gas, except in North America. As a global generation source, gas will be overtaken by renewables in 2027. It will be 2037 before renewables overtake coal.”
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