Griff Thompson, Ph.D.Director, Office of Renewable Energy and Energy Efficiency
Bureau of Energy ResourcesU.S. Department of State
The Energy Transition: Political, Social and Economic
Implications
Key takeaways
• Period of significant technological change that is fundamentally altering the power sector and socio-political structures
• The global energy transition to low-carbon energy economies requires new geopolitical thinking and offers opportunity to revisit our society's basic assumptions
• Institutional and policy innovation required to take full advantage of technological innovation
• Renewables initially fared well under COVID-19 energy demand destruction, but long-term impact is still unclear.
Energy Transition
• Decarbonization
• Decentralization
• Digitalization
• Democratization
One Big Question:
Energy Transition?
Or
Socio-Political Transformation?
Shift in Technology
Source: Shell Sky Scenario (2018)
Source: IRENA
Global Renewable Growth 2015-2019
Renewab le c apac ity highlights 31 Ma rc h 2020
Renewab le genera tion capac ity by energy source
At the end of 2019, global renewable
generation capacity amounted to
2 537 GW. Hydropower accounted for
the largest share of the global total,
with a capacity of 1 190 GW.*
Wind and solar energy accounted for
most of the remainder, with capacities
of 623 GW and 586 GW respectively.
Other renewables included 124 GW of
bioenergy and 14 GW of geothermal,
plus 500 MW of marine energy.
Renewab le power capac ity g rowth
Renewable generation capacity increased by 176 GW (+7.4%) in 2019. Solar
energy continued to lead capacity expansion, with an increase of 98 GW (+20%),
followed by wind energy with 59 GW (+10%). Hydropower capacity increased by
12 GW (+1%) and bioenergy by 6 GW (+5%). Geothermal energy increased by just
under 700 MW.
Solar and wind energy continued to dominate renewable capacity expansion,
jointly accounting for 90% of all net renewable additions in 2019. However, this
unusually high share may reflect the very low expansion of hydropower last year. ______________________________________________________________________________
* Note: these figures exclude pure pumped storage. At end-2019, this was an additional 121 GW,
giving a total hydropower capacity of 1 310 GW.
0
500
1,000
1,500
2,000
2,500
2015 2016 2017 2018 2019
Hydropower Wind Solar Bioenergy Geothermal
0
10
20
30
40
50
60
70
80
90
100
Capacity added in 2019
GW GW
HEADLINE
FIGURES
2 537 GW
Global renewable
generation capacity at
the end of 2019
7.4%
Growth in renewable
capacity during 2019
176 GW
Net increase in global
renewable generation
capacity in 2019
54%
Share of new
renewable capacity
installed in Asia in 2019
90%
Wind and solar share of
new capacity in 2019
72%
Share of renewables in
net capacity
expansion in 2019
statistics can be downloaded
at: www.irena.org/ statistics
47%
25%
23%
5%
Hydro Wind Solar Others
Renewable Costs Continue to Decline
Source: IRENA Power Generation Costs in 2019
Source: Bloomberg New Energy Finance
Lithium-ion battery pack prices down 87% since 2010
This document is for the exclusive use of Daniel Birns. [Reference number:
100592367920200610183454]
Source: Bloomberg New Energy Finance
Lithium cell manufacturing capacity, by plant location
Price (pre-tax) for medium segment EV and ICE in the U.S.
This document is for the exclusive use of Daniel Birns. [Reference number:
100592367920200610183454]
Power Sector Investment By Region 2020-2050Source: Bloomberg New Energy Finance 2019 New Energy Outlook
Source: Bloomberg New Energy Finance
Cumulative gross capacity additions, 2017-2040
Source: IEA
Global Energy Investment 2005-2018
Source: BloombergNEF. Clean Energy includes wind, solar, geothermal, energy efficiency, biofuels, biomass and waste, small hydro, and energy smart technologies.
Clean Energy Investment 2006-2019 ($bn)
This document is for the exclusive use of Daniel Birns. [Reference number:
100592367920200610201932]
Source: Renewable Energy Buyer’s Alliance
Corporate Procurement
Geopolitical Impacts
The energy transition will likely...
• Create new trade patterns and relationships• Reduce the geopolitical importance of oil and gas exporters and consequently...• ...Reduce the geostrategic importance of oil and gas as levers of foreign policy• Create additional demand for key minerals and metals used in clean energy products• Reduce oil and gas-driven conflict• Create significant cybersecurity vulnerabilities
Winners and losers
Asia Enhancing Development and Growth through Energy (EDGE)
Mission: The Asia EDGE initiative is a U.S. whole-of-government effort to
grow sustainable and secure energy markets throughout the Indo-Pacific. Asia EDGE
seeks to strengthen energy security, increase energy diversification and trade, and expand
energy access across the region. Asia EDGE will draw on the expertise and resources of
the U.S. government, private sector, and international financial institutions. The initiative
will partner with like-minded stakeholders/parties to advance the rule-based economic
order that has lifted billions out of poverty and enabled unprecedented growth over the
past 70 years.
Asia EDGE Promotes U.S. values in the Indo-Pacific:
• Strengthen energy security of allies and partners.
• Create open, efficient, rule-based, and transparent energy markets.
• Improve free, fair, and reciprocal energy trading relationships.
• Expand access to affordable, reliable energy.
Clean energy technology deployment is driving mineral demand
Projected demand for mineral intensive clean energy technologies...
…leading to surging demand for strategic minerals by 2050.
ERGI Aims to Broaden the Market for Energy Minerals
To learn more visit: www.ERGI.tools
Challenge: Exponential Growth in Mineral Demand Means the World Needs to Diversify Sources of
Supply and Make Supply Chains More Resilient.• One country controls most mines, most of the refining and processing capacity for critical energy minerals.
• Private companies are unlikely to invest where there are prohibitive above-ground risks.
• Even if the Administration's Executive Order on Critical Minerals reinvigorates domestic mining, The U.S.
alone will not be able to meet global demand, without help from friends and allies.Solution: Create the Correct Above-ground Conditions to Encourage Investment in Mining.
• Affect above ground conditions to level the playing field.
• Support capacity-building through targeted technical support.
• Publicly encourage good governance.
• Develop partnerships with like-minded countries with strong records of responsible mining.
• Support policymakers and industry in both countries through in-depth technical exchanges on clean energy technology, policy, and finance issues.
• Issues covered:• Energy Efficiency• Solar PV• Energy Storage• Electric Vehicles• Energy Innovation• Grid Integration• Waste to Energy• Water/Energy Nexus
U.S.-Israel Clean Energy Finance Task Force
“It is important to note that as our society adopts one sociotechnical system after another it answers some of the most important questions that political philosophers have ever asked about the proper order of human affairs.
• Should power be centralized or dispersed? • What is the best size for units of social organization? • What constitutes justifiable authority in human associations? • Does free society depend upon social uniformity or diversity?• What are appropriate structures and processes for public
deliberation and decision making?”
Langdon Winner
