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Forging Ahead into a Clean Energy Future

Pritil Gunjan
Jun 05, 2020

Solar panel

The International Energy Agency released its World Energy Investment Report on May 27, 2020. A key insight from the report is that countries in full lockdown are experiencing an average 25% decline in energy demand relative to typical levels and countries in partial lockdown an average 18% decline. 

Global megatrends are changing the course of economic activities in the form of oil price shocks, declining coal demand, dampening GDP growth, and limiting energy demand. Although electricity demand has declined during the past couple months, the share of renewable energy generation in the fuel mix has largely increased. It is extremely likely that, although power generation from fossil fuels is anticipated to take a plunge, renewable fuel power generation is expected to accelerate, triggered by technology cost declines and an increased focus on decarbonization. Investment in renewable energy projects is expected to trigger an even more positive effect on greenhouse gas emissions across the sector.

A Shift to Normalcy Enabled by Distributed Technologies

From a scale perspective, although distributed solar has largely been affected by lockdown restrictions, utility scale renewables (both solar and wind) are likely to witness limited long-term effects due to cost declines. As the economies start shifting back to normalcy, a rapid development of distributed energy resource technologies are likely to be an enabler driving the growing need for flexible capacity and meeting resiliency demands across key global economies. 

According to Guidehouse Insights, business continuity across the energy industry can be supported by increasing the adoption of distributed generation assets that can offer flexibility and optimization for end consumers. The changing distributed energy landscape and supporting macro trends create opportunities along the entire supply chain, regardless of market maturity and customer segments. Until the econometric indicators start registering positive movements, energy stakeholders must channel their spending on specific projects and geographies that offer the much-needed ROI and help create a resilient energy infrastructure.