In Q1 in the US wind plus solar made up 97% of new electricity generating capacity. This is just for one quarter, and probably for the year as a whole the percentage will be lower. But the trend of renewables in new capacity has been steadily rising over the last 6 years:
(Source of base data)
And note that this is gross new generating capacity, not net. Over the last year 5% of the US coal generating fleet was shut down, so the incremental addition to generation from wind and solar exceeded 100% of the net rise in generating capacity . And SEIA's prediction for 2016 is that new installed solar will total 14.5 gigawatts (GW), a 94% rise over 2015's 7.5 GW.
Even though wind and solar electricity now form only a small percentage of total US electricity generation, what these numbers mean is that we have passed the tipping point. From now on, at the margin, new (incremental) electricity demand will be met by renewables. And so will more and more of existing electricity demand. (Technically that might not be true, because capacity utilisation rates in coal generators could rise--but that seems very unlikely). In China, too, incremental electricity demand is being more than met by incremental supply from wind, coal, hydro and nuclear. And in Europe, the percentage of renewables in total generation, already high, is rising each year,
Last year coal demand fell by the largest amount in 50 years, in absolute and percentage terms, according to BP. The last time there was a large fall was in 2009, during the GFC, when the world experienced a deep recession, the deepest since the great recession in the 30s. And the time before that was in another (milder) recessionary period, 1990 and 1991. In the 1980-81 recession demand for coal still grew, as was the case in the 1974-75 recession. This is the first time in 50 years than coal demand has fallen in a year when the world hasn't experienced a recession.
This trend will only accelerate as renewables get cheaper and cheaper and more and more generating capacity globally is switched to renewable sources. We will probably still be burning some coal in 10 years. But it will be much, much less than we are burning now. And I doubt coal-fired power stations will still be running anywhere in the world in 20 years.
Emissions from coal have peaked. Emissions from oil? Not yet. More on that in my next post.
Disclaimer. After nearly 40 years managing money for some of the largest life offices and investment managers in the world, I think I have something to offer. These days I'm retired, and I can't by law give you advice. I do make mistakes, but I try hard to do my analysis thoroughly, and to make sure my data are correct. Remember: the unexpected sometimes happens. The expected does too, but all too often it takes longer than you thought it would.
The Goddess of Markets punishes (eventually) greed, folly, laziness and arrogance. No matter how many years you've served Her. Take care. Be humble. And don't blame me.
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