There are few industries changing as quickly and as dramatically as the energy industry. The movement from centralised to decentralised energy networks is well underway.
An ever depleting supply of fossil fuels and a growing global commitment to tackle the climate crisis has set the stage for a revolution in the way we buy, use, generate and store energy.
Recent years have witnessed an explosion of renewable energy supply, the slow death of coal and improvements in the digitisation of energy management in the workplace and the household. So what trends can we expect over the next twelve months and how will these impact UK consumers?
The Big Picture
One trend that’s sure to continue is the tumbling cost of renewables. The price of solar power has plumetted by 80% in ten years and is expected to halve again by 2020. Offshore wind has witnessed an even greater fall in price, with costs decreasing by an amazing 50% in just 24 months as knowledge and technology improve.
Speaking at a recent conference on sustainability, the Director General of the International Renewable Energy Agency (IRENA) Mr Adnan Amin, said:
“the scale and pace of the transformation has accelerated, and this is leading to very significant structural changes to the energy system around the world”.
As costs continue to fall, the economics of renewables become increasingly appealing. Some experts predict global oil demand to peak as soon as 2020 and to decline thereafter, in part due to a rising uptake of electric vehicles.
The Rise and Rise of EVs
Perhaps the greatest shift in energy consumption will come with electric vehicles.
As with other renewable technologies, the costs decline as production ramps up and economies of scale take hold. The number of electric cars on UK roads has risen from 3,500 in 2013 to 125,000 today. This trend is not just because of improved affordability.
A shift in the public’s perception of ‘EV’s,’ plus better consumer choice, an improved network of charge points and reductions in charging time has made them an increasingly appealing alternative to petrol.
In 2018 we can expect to see ever more electric vehicles on our roads, which in turn will stimulate a greater demand for electricity and the further advance of renewables ; a perfect feedback loop!
During 2018, there will be greater exploration of the benefits that EVs can bring to local energy networks in helping balance supply and demand in our communities.
In our next energy trends blog, we’ll take a look at the impacts we can expect from the Government’s smart meter rollout, as well as the game-changing role that battery storage will soon play in the energy industry.