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BP made a mistake in its 2018 World Energy Outlook by underestimating the speed of renewables adoption, notably solar capacity. In an interview with Euractiv, BP’s chief economist, Spencer Dale, explained that while BP was aware of the learning curve typical of solar capacity adoption, it was unaware just how far along that curve the world had traveled.
The learning curve in solar energy capacity expansion is closely related to production costs: for every doubling of capacity, costs fall by a quarter. So, BP was apparently surprised not by the scale of the transition to renewable energy, especially in China and India, but by the speed.
As Dale said, the actual solar capacity figures from China are “telling us less about solar energy and more about the pace of the energy transition in China. And the pace at which essentially they’ve reduced their share of coal and filled up that hole with solar energy.”
According to some, this is not the first time BP has underestimated renewables adoption. “Every year BP has predicted a sudden slowdown in renewable energy growth, and every year it has been wrong,” Greg Muttitt from green NPO Oil Change International told Euractiv. However, it’s not only BP that has been consistently underestimating alternative energy. The IEA has also underestimated renewables as had the European Commission.
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Even so, Dale made a point of warning that China’s solar race could start sputtering some time in the future. This should be a safe enough prediction: sooner or later the local energy market will become saturated with solar power capacity.
Last year, China added 53 GW of new solar capacity with investments of US$86.5 billion. The new capacity addition accounted for more than half of the global total for 2017, which stood at a record-high 98 GW. Global investments in solar power last year reached US$160.8 billion.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.
you assume that the new energy solutions are incapable of filling the gap oil will eventually leave. Unless oil fields dry up in the next decade or two, I don't see that as an issue. There are plenty of up and coming technologies (Power to X, now in the initial commercial test phase and the tech to watch for during the 2030s) as well as experimental ones (Fusion: now approaching first practical designs in the form of ITER; High/Room temperature superconductors, which will lower the cost of Fusion and increase long distance energy grid efficiency. These are probably 2060/70s commercial technologies) and more established ones (Batteries, the 2020s will be their decade) which combined, will make renewabels an all round solution capable of replacing oil. This probably won't happen over the next 20 years but should be more than possible by the end of the century even with business as usual. My guess is that oil reserves will last about that long or longer so there's almost no reason to assume that lack of oil will cause a structural collapse. Climate Change is a much more dangerous element in that respect as we are currently on a trend towards 3 degrees or even over 3.5 degrees of warming. Those numbers are more or less in the red zone. It goes without saying that tackling Climate Change will ensure oil doesn't suddenly run out leaving us without energy, since acting within the prescribed time frame suggests a major shift away from oil by the middle of this century and also requires that much of the known oil reserves remain in the ground.
It will be interesting to see how long it takes oil consumption to begin to decline from substitution by renewable energy sources. I suspect it will be at least another decade.
People had better hope that oil supply can keep up with demand for oil until oil demand begins to decline only because renewables have become the preferred energy source. Unless that is the case, people are going to be in for a world of hurt.
Then again, Professor Mayer Hillman just said in The Guardian that, "We're doomed."
I suspect that he is correct. He has been correct before. I suspect he is again correct, but not for the reason he thinks.
It won't be runaway climate change that does most of humanity in. It will be economic collapse caused by not having enough oil to keep expanding the economy. Unless another energy source is discovered which can replace oil before the oil supply can no loner meet the demand for oil, the banking system designed to exist only in periods of continuous growth, will collapse. The banking system can't survive a prolonged period of shrinking economic activity caused by a declining supply of fuels made from oil.
Few people then alive will have to worry about trying to live near the poles in the future, so as to avoid the vast deserts covering most of the land remaining above the oceans, as the professor postulates. Long before that happens, industrial civilization as we now know it, will probably be long gone. The oil shortage will get most of us, way before the runaway heating from carbon dioxide and methane release from the permafrost and oceans gets a chance to do it.
And high altitude spraying of sulfur compounds may be possible to cool the planet, as long as fuel can be found to do it.
Being a former stockbroker myself, now retired, I can testify to this practice by investment firms.
It comes as no surprise to me that China should be the country that is at the forefront of solar energy adoption as they suffer the most from their own past misguided over adherence to fossil fuels. Get on with it BP and realize that BP is truly in the ENERGY INDUSTRY and not just in the oil business. Change will always punish those who refuse to adapt.