How Has The Covid-19 Affected The Growth Of Renewable Energy? - EV Motors

How Has The Covid-19 Affected The Growth Of Renewable Energy?

March 2020 marked the beginning of a highly irregular period in human history. In response to the emerging public health threat of Covid-19, countries worldwide closed their borders and went into lockdown. Almost overnight, industries, businesses, schools, and even sections of the government shut down. The result? Reduced transmission of Covid-19, an economic downturn, and an 8% decline in energy-related emissions. Yet, as economies recover and restrictions end, how has the renewable energy market been affected?

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Research suggests that growth in the renewables market slowed in 2020, but the influx of economic recovery funds allocated for renewable energy efforts will continue to push the energy transition forward.

Pre-Pandemic

Before the pandemic, humanity was moving and innovating at a breakneck pace.

Automation, machine learning, and AI are helping to produce more, in less time, with less waste.

Global economies are more interconnected than ever and rely on the free flow of trade and goods.

But this breakneck pace of innovation has severe consequences for the environment.

The path that humanity was on was not sustainable.

Efforts have been underway to reduce carbon emissions since the mid-2000s.

Countries and companies had begun to invest heavily in renewables.

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China, the global leader in manufacturing and carbon emissions, intends to become Carbon neutral by 2060.

The renewable energy market was growing year over year. Between 2004 and 2019, Europe’s renewable energy consumption rose by 10%.

Postponed Projects

Following the lockdowns, many companies resorted to layoffs to reduce the complete loss of capital and bankruptcy.

Then came the supply chain disruptions. Lead times for supplies and projects increased by the day.

Renewable energy installations were widely postponed, in the first half of 2020, often by six months.

Wind and solar projects in Germany, France, Denmark, and Austria, were provided extensions and flexibility for their commissioning timelines.

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Policy was changed to allow companies waiting for components or construction to still receive the financial incentives upon project completion, despite missing the original policy deadlines.

These construction setbacks didn’t wholly prevent gains in the renewable energy sector. Renewables generation rose 3% in 2020.

Sustainability & Economic Recovery

According to the European Climate Foundation, roughly 286 billion Euros has been invested in 800+ projects focused on renewable energy or adjacent topics in recent years.

European companies plan to invest over 1 trillion Euros in renewables by 2030.

The climate target for the EU was raised in late 2020, despite the pandemic, to 55%. Solar and wind energy is expected to dominate the renewable energy growth in Europe.

A high degree of private sector engagement is necessary to transition to renewable energy at scale.

As companies work to recover from the economic downturn, governments should continue incentivizing investment in and transition to clean energy programs.

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While the pandemic has been a public health disaster, Covid-19 has provided a unique opportunity for the European Union and other countries to invest heavily in transitioning to a sustainable economy.

Economic recovery funds are being prioritized towards forward-thinking, environmentally-friendly businesses and sectors.

Research has determined that completely decoupling the GDP (gross domestic product) from emissions cannot be achieved.

Instead, the EU must develop renewable energy technology and infrastructure to protect the environment from further degradation.

225 billion Euros in recovery funds has been allocated to the renewable energy transition.

Resilience of Renewables

In the face of incredible struggle and the pandemic crisis, renewable energy has displayed its staying power.

Countries remain committed to transitioning their economies to renewables.

The McKinsey consulting firm expects investment in the renewable energy sector to remain strong and grow through 2035.

Wind and solar will likely dominate the renewables market, but hydrogen is looking to become more cost-effective.

The future of Covid-19 is uncertain; infections are at their lowest levels since the beginning of the pandemic.

Vaccination rates continue to climb, and it seems there is light at the end of this long pandemic tunnel.

Regardless of the challenges, renewable energy is resilient. The energy transition will continue, and it’s exciting to imagine a carbon-neutral future.

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