US renewables can more than triple by 2030, but need more investments

Author:
Ilario D'Amato
Reading time: 5 minutes
14 January 2015

NEW YORK: The share of renewable energy of the US energy market can more than triple by 2030 – using already existing technologies, states a new report.

The study Renewable Energy Prospects: United States of America by the International Renewable Energy Agency (IRENA) shows how such a bold target is “technically feasible and cost effective” given the fantastic US geographical potential in harvesting renewable energy.

In 2010, the share of renewables accounted for 7.5% of the total energy mix in the US. But with the right policies and investments, it could more than triplereaching 27%. Such a bold but achievable target could save the US economy between US$30 billion and US$140 billion per year by 2030, considering the health effects of the CO2-related climate disruption, the report indicates.

However, the level of investment in this sector is still too low in the US. In fact, with the current ‘business-as-usual’ scenario, the share of renewables will increase by just 2.5% by 2030, reaching a mere 10%. IRENA writes that an additional investment of US$38 billion per year in energy capacity is needed, totaling US$86 billion per year.

US ENERGY RESOURCES

Its advantage in terms of natural resources and technology could mean the US accounts for 13% of global use of renewables in 2030, making it the world’s second largest user after China. Even if hydroelectric power accounts for more than half of its current renewable power generation, the country has a very high potential for wind energy – now accounting for 4% of the total electricity demand.

Considering the power generation sector, in 2013 the US had an installed capacity of 78 gigawatt-electric (GWe) for hydro and 61 GWe for wind power. The US is also the largest biofuel producer in the world, accounting for 57% of world ethanol production in 2013 – and in that year, bioenergy totaled 22 GWe. Solar power reached 13 GWe, with a dramatic increase of 8 GWe added by photovoltaic systems in the last two years. However, fossil fuel and nuclear-based generation still accounted for 89% of production in the power sector in 2010.

RENEWABLES: GOOD FOR BUSINESS

It is clear renewables are playing an increasing role in the US economy and can help save both the environment and money – avoiding the economic and social costs of climate disruption. However, the report states that to spur the low carbon revolution, the market needs certainty through “consistent, predictable and long termpolicy support.

At Climate Week NYC in September, forward-thinking businesses, including 15 of the world’s most influential companies, took the lead ahead of their governments and announced their commitment to switch to renewable power by 2020.

Business as usual’ in terms of energy consumption is no longer an option either for maintaining a competitive industrial base or for reducing emissions as we need to do,” Ben Ferrari, Director of Corporate Partnerships, The Climate Group commented.

“We know that we can achieve a win-win outcome in this respect: adoption of renewable power delivers business value at the same time as cutting carbon. This is why leading companies are committing to use 100% renewable power sources as they join the RE100 campaign: green business is good business.”

To highlight this corporate demand for renewables and the role of business in decarbonizing the power sector, The Climate Group will hold a panel at the World Future Energy Summit in Abu Dhabi on January 19. Speaking at the four-day event dedicated to renewable energy, energy efficiency and clean technologies, leading corporates – like RE100 founding partners Swiss Re and IKEA – will showcase how renewables are key for businesses of the future.

At the same event The Climate Group will release an Insight Briefing, to further document how investment in renewable technology is a smart business decision. Discover more on the just-launched RE1000 website.

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by Ilario D'Amato

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