2018 was a year of significant renewable energy announcements and commitments from major oil and gas companies, electric utilities and corporations. This level of commitment across such large sectors signals that 2019 could pave the way toward major changes across the energy sector.
Big Oil Investments In Renewable Energy
A number of traditional oil and gas companies are in a state of transition and have announced plans to expand their businesses to be all-inclusive energy companies. Many of the world’s largest oil companies took a serious look at renewable energy in 2018.
Statoil changed its name to Equinor, signifying a new vision for the company as an all-inclusive energy corporation. Shell’s recently released “Sky Scenario” set stage for the company’s commitment to renewable energy investments.
In early 2018, Shell acquired a 43.83% interest in U.S. solar company Silicon Ranch Corporation and most recently, Shell formed a joint venture to produce offshore wind energy in New Jersey with EDF Capital Renewables North America. And Exxon Mobil Corp. recently signed the largest renewable contract by an oil company to purchase 500 MW of wind and solar to produce crude oil in Texas.
Utilities Voluntarily Commit To Renewable Investments
2018 was also an inflection point for U.S. electric utilities, which began to willingly retire coal plants rather than respond to years of mandated renewable energy requirements. Competition of cheaper power from gas and renewables, coupled with a more experienced utility workforce with greater familiarity with new technologies, is allowing these companies to find innovative ways to meet the renewable energy demand of their large energy consumers and corporations. Xcel Energy, one of the biggest utilities in the U.S., announced a carbon-free commitment by 2050 (80% by 2030).
100% Clean Energy Commitments From Corporations, States
Corporate renewable energy procurement in the U.S. reached record levels by last October. From big investment banks to auto manufacturers, IT firms to retailers, a broad range of corporations have committed to 100% renewable energy initiatives. Apple, Google and Microsoft are powered by 100% renewable electricity, helping to accelerate the trend.
Many more corporations around the globe are on track to follow suit, making renewable energy commitments that have the power to reshape how entire industries operate. For example, this past April, Apple announced that its entire worldwide operation ran on 100% renewable energy, including retail stores, data centers and its huge campus in Cupertino, which has one of the world’s largest rooftop solar arrays. The IKEA Group has committed to produce as much renewable energy as the total energy it consumes in its buildings by 2020. Maersk, the world’s largest container shipping company, issued its commitment be carbon neutral by 2050 after many years of meeting with non-governmental organizations (NGOs) and environmental groups to discuss alternatives like hydrogen fuel cells and emerging technologies.
States are establishing significant goals, too. California, the world’s 5th largest economy, approved a measure requiring all energy used statewide to be produced from renewable sources by 2045.
What’s Next In 2019?
The coming energy transition cannot be denied with decades of anticipated exponential growth for new energy resources and technologies. 2019 is expected to have record growth for solar and wind due to the last year of the full federal tax incentives for both technologies.
Advancing technologies are also expected to accelerate the growth and efficiencies of these projects through software platforms, digital applications, and analytic programs.
Renewable Portfolio Standards are expected to increase and voluntary commitments to renewable projects from the utility market are expected to grow as utilities develop greater experience with renewable projects.
Renewable +Storage announcements are expected to be exponentially higher than previous years due to the rapidly decreasing cost of battery storage and ability to allow renewables to be a dispatchable resource.
Recent research led by IHS Markit provides an overview of the challenges and opportunities in the U.S. clean energy innovation landscape.
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