Bloomberg’s ‘New Energy Outlook 2017’ predicts that yearly investment in renewable energies will grow 2-3% per year from now on, eventually reaching $400 billion a year by 2040.
New Energy Outlook made its predictions by modeling how the shifting costs of both renewable energy and conventional energy might change the future of the energy landscape. The 2017 report finds that the costs of wind and solar power are dropping faster than expected, meaning that renewable energy will account for the majority of the United States’s expected $10.2 trillion in energy investments up to 2040. Solar power is predicted to make up $2.8 trillion of investments, whereas $3.3 trillion will be used for wind power.
According to the study, the cost of solar and wind capacity installation will be cheaper than the cost of conventional energy for most markets by 2023. In addition, by 2030 the generation of electricity with renewable energy installations will be cheaper than generating electricity at conventional power plants.
If these predictions hold true, emissions from the energy sector are on track to peak in 2026 and will then decline by around 1% a year until 2040. This is a quicker decline than was previously estimated, but the report notes that there would still remain a noteworthy gap between that decline and “putting the power sector on a 2 ºC trajectory.” Intervention through investments for a further 3.9TW of renewable energy at the cost of around $5.3 trillion would be required.
Other findings from the report suggest that investments into renewable energy generation are expected to expand greatly. Just during the month of June, financing commitments for around 1.7 GW of solar power generation were announced by a variety of international financial institutions and regional banks. Also in June, the European Bank for Reconstruction and Development (ERBD) approved a $5.7 million loan to create a geothermal power plant in Turkey.
Other green projects have also received funding in June, including a $5.5 million grant approved by the Asian Development Bank for developing a large-scale carbon capture and storage trial project in China.
