Wind, Solar and Cheap Oil, Oh my Published 2.1.2016
As written about here numerous times at this point, the oil market and oil prices continue to decline. However, wind and solar market are mostly unaffected. Wendy Koch explains why
Lower oil and gas prices did affect sales of electric vehicles (EV) sales in the US, though worldwide EV sales increased in 2015
. Prices for wind and solar energy has decreased, even as oil and gas prices have declined. This price decline is great for end users, but has taken a toll on the solar panel industry, which is basically now centered in China, because manufacturers elsewhere can’t compete with Chinese panel makers. This crushing of solar panel producers (contraction in panel manufacturing) has been a multi-year process.
Solar and wind accounted for 60% of new power generation in 2015 in the US. and the compromise budget agreement signed into law at the end of the year kept the subsidies in place for renewable energy for five more years (tax credits). In exchange, Congressional democrats didn’t block allowing the export of US oil. Though in the current market, that isn’t a huge win. But in the future it might well be a win for the oil industry.
Countries are looking to wind and solar to meet carbon dioxide emission limits agreed to in Paris, which helps with demand. The US is slowly killing its coal industry, but China and India are also looking to use less coal to alleviate pollution levels. Everyone is familiar with the picture of Beijing smog at this point. Solar panels for decentralized power is growing in Africa. It’s growing in the US as well, though with all tech there are trade offs. My solar skeptical brother loves to tell the story about ice sheets sliding off panels and almost killing people. Could this happen? Sure, but it could also be engineered away too.
States in the US are requiring that Utilities produce a certain percentage of power from renewables. Corporations are also looking to renewables (especially solar) as a way to lower their fixed costs. Power generated on site is power that doesn’t have to be bought from the power company. Per Koch, 55% of US companies claim to generate some of their electricity on site, and 13% of that amount is wind or solar. In 2015, Apple made a huge bet on solar
Search this site: