Sourcing Renewables - March 20, 2020
Study shows significant drop in RE demand amid Covid-19 outbreak
A report released by BloombergNEF on March 12 estimates that the coronavirus pandemic will significantly impact the renewable energy market over the coming year, including a drop in global solar demand from 121-152 GW to 108-143 GW and the first down year for solar capacity addition since the 1980s.
“Covid-19: Impact on Clean Energy, Transport and Materials” details the drop in solar demand despite Chinese factories beginning to reopen at this time. There has been a 16% decline in BNEF’s midpoint estimate of solar build in 2020 since Covid-19 reached a pandemic level.
There is also an expected drop in electric vehicle and battery demand as the auto market responds to the larger global macroeconomic conditions. BNEF expects a 4% decline in battery demand GWh in 2020 following the Covid-19 crisis.
Alternatively, the BNEF report expects wind power to be the exception, with a projected downside risk to their forecast of 75.GW. This would still make 2020 a record year for wind capacity.
As policy decisions are turned away from renewable energy toward more pressing matters, the interruption to production in China has also highlighted the need for more diversified supply chains around the world.