Fossil fuels are holding on, but end of their reign is nigh, says a new report from Bloomberg New Energy Finance, which predicts that wind and solar will be cheaper than coal and gas generators by 2027, and electric vehicles could make up 25 percent of the global car fleet by 2040.
The peak year for coal, gas, and oil looks to be 2025, and then it’s all downhill from there. For big oil guys, at least. "You can't fight the future," says lead researcher, Seb Henbest. "The economics are increasingly locked in."
Released on Monday, Bloomberg’s New Energy Outlook report has found that US$11.4 trillion will be invested in new energy sources over the next 25 years, and two thirds of that will go towards renewables, particularly wind and solar.
Any new coal plants will mostly be cropping up in India and other emerging markets in Asia.
"Cheaper coal and cheaper gas will not derail the transformation and decarbonisation of the world’s power systems. By 2040, zero-emission energy sources will make up 60 percent of installed capacity.
Wind and solar will account for 64 percent of the 8.6TW [1 Terawatt = 1,000 Gigawatts] of new power generating capacity added worldwide over the next 25 years, and for almost 60 percent of the $11.4 trillion invested."
The report predicts that coal, gas, and oil will peak by 2025, and will hit its final decline even sooner than that, concluding that, "coal and gas will begin their terminal decline in less than a decade".
By 2027, the real tipping point will occur, when fossil fuels will be well and truly on the decline and renewables have been established long enough that they’ll likely be generating energy more cheaply than existing coal, gas, and oil refineries. And there’s nothing quite like a cheaper price to accelerate an industry even further.
Let's just take a moment and think about that for a second. For the first time since humanity fell in love with producing crazy amounts of energy to give us such luxuries as cars, electricity, industrial-level food production, and overseas vacations, we've figured out how to do it without stomping all over the environment in the process.
We're not there yet, but the writing is well and truly on the wall, and that's a pretty phenomenal achievement by researchers all over the world who have been working their butts off to make renewable technologies viable on a massive scale - even more viable than fossil fuels.
But here's the bad news. For as promising as the rise of renewables and the fall of fossil fuels is, Bloomberg's report says their projections won't be enough to limit the global warming increase of 2 degrees Celsius (3.6 degrees Fahrenheit) that was targeted by the 2015 Paris Climate Conference.
"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 degrees Celsius climate target," says Henbest.
According to Andrew Freedman at Mashable, to meet what everyone agreed needed to happen at the Paris Conference, an additional US$5.3 trillion in new clean energy investment would need to be invested worldwide in the next 25 years.
Below are some more insights from the report:
- Coal and gas prices will stay low.
- Wind and solar costs fall sharply.
- An electric car boom is expected, and will likely represent 35 percent of worldwide new light-duty vehicle sales in 2040 - which is 90 times the 2015 figure - and 25 percent of the global car fleet overall.
- Small-scale battery storage will become a US$250 billion market to enable more residential and commercial solar systems.
- India, not China, will be the key to the future global emissions trend, with its electricity demand forecast to grow 3.8 times between 2016 and 2040.
- Renewables will dominate in Europe, and overtake gas in the US.
You can access the report online here.
To be clear, these are just very educated predictions based on government and industry spending, so none of this is set in stone. But experts have been predicting the end of the fossil fuel era for years now, and we're probably going to see it within our lifetime. What an awesome thing to look forward to.