Good News: World Is Increasingly Shifting To Renewable Energy Production, Including The US

Our world has been relying on fossil fuels a lot to generate electricity, fuel for vehicles. So much so that world economies are being impacted with the prices of fossil fuels. However, 2019 was a different year -- a greener year.

Reuters

According to the data from the International Renewable Energy Agency (Irena) In 2019, more than one-third of the world was being powered by renewable energy as opposed to fossil fuels, shattering all records.

Renewable energy is expanding globally

While from 2018-2019 new construction for renewable energy slowed down slightly, so did the construction of fossil fuel infrastructure -- causing the share of renewables to grow. A total of 72 percent of the new electricity sources installed globally last year were renewable.

Asia is one of the largest contributors

As per Irena data, Asia was one of the largest contributors to solar energy, accounting to 55 percent of all the new additions, with countries like India, China, Japan South Korea and Vietnam leading the way.

Reuters

Wind Power rose by 34 percent -- with major additions in China as well as the US. Globally wind power capacity is still larger than that of solar with 95 percent onshore turbines.

Oil prices are down but construction costs are more

Oil prices today has come down exponentially, due to COVID-19 crisis drastically reducing the demand for oil globally. Planes are parked in the airport, cars are locked in the garages.

But when researchers look at the costs of manufacturing a facility to mine oil versus setting up a solar or a wind energy plant, not only it¡¯s hassle-free, but also considerably cheaper. Moreover, the additional tax incentive is tempting for newer companies to invest in green energy, tempting people to invest money.

A report by the New York Times, due to a considerable drop in prices the capacity of solar energy in the US has increased by 23 percent from the year before. It has added 13.3 gigawatts -- a lot more than the natural gas generation.

Reuters

In fact, it is even attracting major players in the natural gas segment to go gree. CEO of 547 Energy -- an investment firm specialising in renewable energy -- said in a statement, ¡°As an investor in clean energy, renewable energy, the fundamentals that drove us to invest have not changed. The renewables have become more attractive financially.¡±

He added, ¡°In difficult economic times like these, private equity investors like Quantum (a company that has invested only in oil and natural gas in the past) are eager to seize on businesses that can quickly scale up and start earning money.¡±