Democratizing Solar Energy: Efficiency, profitability and affordability are useful to democratize this source of energy.
A unique goal to tackle climate change permitted to implement the Paris Agreement in November 2016, we’ re facing a serious challenge to alleviate much of our oil dependency: a fundamental modification of our energy supply and use will modify our way to produce wealth. Firms as economic agents participates to create growth, but large corporations are signing new power purchase agreements to lower their energy supply and become less reliable on oil.
50
40
30
Snapshot of the global investment in the energy sector
Oil & Gas supply
46 % of the total investment allocated to oil & gas compared to 23 % for renewable energy. However, we can see that coal tends to be less profitable an require less investment than before: a global trend boost renewable energy investment.
The entire energy sector will demand significant investment if we want to keep pace with growth. Indeed, 1.8 trillion of US dollars was the amount invested in the current sector; 50 % of the amount was entirely directed towards gas, coal and oil which proves that we can’ t really adopt a behaviour that will permit us to substitute oil with green energy. The situation is complicated since that we will have to use fossils fuels energy in order to keep growth, but we can also underline the fact that 23 % of the total investment was allocated to low carbon energy and the number will continue to increase every year since we’ re engaged in a revolution of our consumer habit shifting our energy consumption.
Exhibit 1
Solar Energy: Higher performance and capacity, investment is a key to obtain better results to diversify our source of energy.
Capacity( Mw)
150000
20
10
0
Coal Supply
Electricity Networks Energy Efficiency
Source: IRENA Perspectives for energy transition 2017.
Power generation( Renewable energy)
North America
Oceania Middle East
Asia
Africa
Europe
|
Source: IRENA Capacity Statistics 2017.
0
|
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
The market will continue to grow in the future, we have to expect that the level of investment will permit to expand the pie for every actors of the industry. China plan to invest 2.5tn yuan by 2020 according to the country’ s energy agency, a clear path to less oil or coal power. Indeed, China will ultimately lead the market with 3.5 million jobs thanks to their commitment in green energy, they also allocated 0.6 to 0.8 % of their GDP in renewable energy as investment to create employment and growth. Followed by the European Union, Brazil and North America, investment in solar energy is less impressive than wind power. According to the International National Agency, only 34 % represents investment in solar PV whereas 37 % of the investment is led by wind farm. Moreover, some countries like Japan give priority to solar energy due to their geographical location. In terms of investment, China understand that cutting cost will help them provide enough energy, on a larger scale solar energy can be very profitable to their industry enhancing their productivity and performance in the long term. About the European Union or North America, we’ re actually facing a shift in terms of consumption: solar energy tends to become more and more interesting for large corporations attracted by low costs.
Clean energy investment: A transition towards renewable energy to conceptualize a post-oil city.
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