With COP 26 delegates gathering in Glasgow this week to chart a course for faster, deeper carbon cuts, and many of them arguing for a managed decline in fossil fuels, a steady stream of news in the last couple of weeks points to faster deployment and plummeting prices for renewable energy.
From developing countries like India and China that had been expected to decarbonize at a slower pace, to climate-recalcitrant Australia, to the United States, even a small smattering of coverage points to an opportunity that delegates were just beginning to glimpse at the Paris climate conference in 2015, but is now accelerating at a pace they may not have imagined possible.
In India, a mid-October analysis by the Institute for Energy Economics and Financial Analysis (IEEFA) pointed to a surge in solar installations that put India in a position to cap coal-fired electricity production in 2024, sooner than expected.
“India’s electricity demand has surged and slumped in recent months as the economy revives in fits and starts, but the fact is that coal-fired power is increasingly sensitive to the performance of renewable energy,” wrote IEEFA analysts Tim Buckley and Charles Worringham.
“Coal has effectively become India’s swing producer of electricity, rising to new peaks in periods when demand is high and renewable power low, but slumping deeply when demand falls and renewable energy’s contribution rises,” they explained.
“But while the variable nature of renewable energy is well known and the financial fortunes of coal-fired power are increasingly tied to its generation level, it is a recent change in a different number that may prove decisive in determining how soon coal’s contribution to India’s electricity reaches its peak. That number is the rate at which the country is installing new solar capacity.”
After seeing the COVID-19 pandemic drive solar installations down to 411 megawatts per month in 2020, new capacity surged to 1,248 MW in June, 1,605 MW in July, and 1,672 MW in August, IEEFA reports. “If this installation rate continued, solar capacity would reach 109 gigawatts (GW) by March 2024,” the two analysts say, “enough to meet all of India’s electricity generation increase,” even allowing for the 5.7% annual increase in demand the country saw over the decade ending in 2019.
“Whether the actual installation rate matches, falls short of, or exceeds this rate will come down to the determination of the Indian government,” IEEFA acknowledges. “What the last few months clearly demonstrate, however, is India’s ability to now accelerate the installation of grid-scale solar fast enough to cap coal-fired power before the middle of the decade and potentially to see a gradual coal generation decline from that point on.”
In tandem with the IEEFA assessment, China announced it had started construction on a 100-gigawatt solar and wind project that President Xi Jinping said was progressing in a “smooth fashion,” PV-Tech reported. The announcement was just the beginning of a buildout expected to bring hundreds of gigawatts of new capacity to desert regions, part of the country’s plan to install 1,200 GW of new renewable capacity by 2030.
And in Australia, a country most recently renowned for raging bushfires, pounding rains and floods, and its national government’s stubborn insistence on promoting coal and liquefied natural gas production over renewables and energy efficiency, rooftop solar drove the cost of electricity in the state of Victoria down to zero for six hours each day in August and September, RenewEconomy reports, citing data from the Australian Energy Market Operator (AEMO). The average wholesale price of power over those two months came in at one cent…per megawatt hour.
“The electricity industry has been decarbonizing much faster than other parts of the economy,” The Guardian writes. “While still contributing about one-third of Australia’s carbon emissions, the power sector has been the main reason Australia’s Paris agreement climate pledge to cut 2005-level emissions by 26 to 28% for 2030 is likely to be exceeded.”
“This trend of falling prices through the quarter was in sharp contrast to international energy prices for LNG and coal which continued to rise throughout the quarter, reaching record levels,” said AEMO Chief Markets Officer Violette Mouchaileh.
RenewEconomy has details on regional power prices in different parts of the country.
In the U.S., meanwhile, renewable power giant NextEra Energy is planning a 500-megawatt wind farm to power a nearby green hydrogen facility, a project that is the first of a “lot more like that,” Executive VP and CFO Rebecca Kujawa told Utility Dive.
“The facility, in turn, would pump out green hydrogen that could then be sold to commercial and industrial companies looking to switch out grey hydrogen and fossil fuels,” the industry newsletter states. “Overall, NextEra said it has added more than 5,700 megawatts over the first nine months of 2021 to its backlog of renewable energy and storage projects.”