Wondering if the pandemic will increase the use of fossil fuels and hurt renewable energy sources like wind and solar farms? Well, that’s hardly correct!
How far we’ve come & yet a long way to go
Renewable energy sources are set to account for nearly 21% of the electricity the United States uses for the first time this year according to one forecast aired last week. While some of major solar and wind projects have been delayed by the outbreak, we expect the renewable business to emerge in a far better way as the coal, fossil fuels and gas companies struggle financially.
California and Texas are not the only ones with wind turbines and solar PV. There are many places in the world where Solar PV and wind turbines are now producing electricity for a lower cost than fossil fuel and coal and that is what made it attractive to utility companies and investors. Also, utilities will try to get more electricity from wind and solar farms, which cost little to operate, and less from power plants fuelled by fossil fuels.
We know that the economic slowdown caused by the virus is taking a toll on the renewable energy industry just as it is on the rest of the economy. Even the Solar Energy Industries Association has downgraded projected growth that was expected this year.
These could be overly pessimistic. “It’s still too early to call,” Ravi Manghani, head of solar at research at Wood Mackenzie, an energy research and consulting firm. His firm estimates that solar and wind power will continue adding capacity this year and next. Raymond James analysts estimated in a report last week that renewable energy sources would provide 20.7 % of the nation’s electricity this year and at least 20% through 2022.
A ray of hope
Although hydroelectric plants have long helped power homes and businesses, but solar and wind power also emerged as next major energy sources only over a decade or so. A sharp drop in the price of solar panels has helped the industry expand. Nation’s solar capacity has visibly increased from the year before. It is evident that the developers can build wind and solar farms more quickly than natural-gas, coal and nuclear plants hence become more attractive financially.
We might not able to get things done projected for this year because of the virus, but the solar industry is optimistic that it won’t affect the broader trajectory. We all expect that the solar industry will add more panels this year than in any other previous year. That might not happen now, but the industry is still poised to add capacity.
Interestingly enough, a handful of state regulators are linking recovery efforts from the impending COVID-19 economic slowdown directly to existing or new clean-energy commitments, signaling and reaffirming their focus on advancing the energy transition as a stabilizing force in these uncertain times.