The beginning of a brand new decade is always an opportune moment to look back at the preceding ten years. In relation to the global power industry, what categorized the first decade of the 21st century and what is its legacy for the next ten years?
In my opinion, one of the defining developments in the global power industry over the past decade has been the phenomenal transformation of renewable energy from a small-scale, emerging fuel source utilized by a few, into a major player in the world’s power generation mix. Wind power, in particular, has achieved this with some aplomb.
According to the Global Wind Energy Council, over the past ten years, the world’s wind capacity has grown at an average cumulative rate of more than 30 per cent, bringing the current total installed capacity to over 157 GW. Contrary to expectation, despite the recent economic downturn, wind power capacity increased by 31 per cent in 2009, with the US shattering installation records and China doubling its total installed capacity for the fifth year in a row.
What has precipitated this change? Obviously the drive by governments and policymakers to cut our greenhouse gas emissions, specifically carbon dioxide, has played a pivotal role. This in turn has been fueled by the climate change debate – something that has dominated discussions in both parliaments and boardrooms across the world, and will continue to do so.
However it is not just the use of renewable energy that has been revolutionized over the last decade. This desire to decarbonize our economies has also had profound effects on other power generation sources.
Having lain dormant for close to 30 years, nuclear power is back on the menu; the low-carbon menu that is. The term ‘nuclear renaissance’ has been banded about for the last few year, although arguably a little prematurely, but there is clearly a growing number of countries looking at reactivating their nuclear programmes or even building their first nuclear plant.
The low-carbon agenda is also forcing coal fired power generation, the world’s generation staple, to transform itself from a ‘dirty, polluting’ energy source into one that produces clean energy through carbon capture and storage (CCS).
The last decade saw the first signs of a major change in our energy landscape. So what about the next ten years? The world’s energy sector will continue to evolve and in all probability evolve at a faster pace. In Europe, for example, such changes are being driven by legal targets on cutting carbon emissions and increasing energy efficiency, all by 2020, as well as ensuring security of supply. Whether this is achievable of course remains the ‘million dollar’ question.
On renewables, I expect to see wind power continue to dominate, with offshore development superceding onshore. While interest in developing utility-scale solar – both concentrating solar power and photovoltaics – is likely to grow significantly. But will we see the first installations of the ambitious Desertec project before the end of the decade?
With regard to nuclear, although governments are making the right noises, and to a lesser extent industry is too, I remain unconvinced that we will see a fully-operational, brand new nuclear plant – excluding Flamanville in France and the third unit at Olkiluoto in Finland – before 2020. Although potentially it could happen in the early part of the next decade.
Finally, I believe that the next ten years will be a pivotal time for the future of fossil fuel power generation and the commercial development of CCS. I hope to see a number of demonstration programmes taking place, moving to commercial demos in the latter years. Without this, coal fired power generation, in particular, is likely to be dead in the water.
I cannot profess to having a crystal ball, so it will be interesting to see whether my predictions for this decade hit the mark or prove some way off the mark.