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https://reneweconomy.com.au/three-key-reasons-why-the-world-is-falling-behind-on-its-renewable-energy-targets-report/>
"Deployment of renewable energy technologies is falling behind what is needed
to reach global targets as investors hesitate to commit the necessary capital,
threatening hundreds of gigawatts of vital renewable energy capacity.
And while there remains significant support for renewable energy across major
regions like Europe and the United States, the near-term pipeline remains at
risk, with many projects yet to reach final investment decision (FID),
increasing the risk of project cancellation.
These are the headline findings from a new analysis from global management
consulting firm McKinsey & Company which analysed the energy transition
landscape including the uptake of key clean energy technologies and investment
decisions.
McKinsey determined that there were three key issues threatening the necessary
deployment of capital, starting with a weak business case for clean energy due
to uncertain economic returns and a lack of policy certainty for developers.
Many technologies “are increasingly but not yet cost-competitive for
consumers,” serving as a second roadblock to capital development, “given the
lack of at-scale manufacturing capacity or learning rate driven by deployment.”
Meanwhile, several technologies deemed necessary to the long-term energy
transition have yet to be scaled up to a point that inspires confidence in
investors.
These issues threatening investment have worked to stall deployment levels,
resulting in a number of announced projects not yet reaching FID, and other
projects with longer lead times – such as offshore wind – “quickly reaching the
stage at which capacity that has reached FID will only come online after 2030.”
Even as national renewable energy commitments continue to increase, financial
and political uncertainty threaten existing announced pipelines – pipelines
which are already behind where they are needed to be.
“Indeed, decarbonisation technology projects have historically had a high
fall-through rate, with only a small percentage of announced projects reaching
FID, and an even smaller numbers of projects actually being realized,” write
McKinsey’s analysts.
“Our analysis shows that many planned projects for key decarbonisation
technologies in the European Union and the United States are falling short of
announced targets, some significantly so.”
These shortfalls vary by both technology and region, but even the most stable
of technologies – solar PV and onshore and offshore wind – are yet to get on
track with 2030 targets, and “short-term deceleration is threatening the
existing pipeline further”."
Cheers,
*** Xanni ***
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mailto:xanni@xanadu.net Andrew Pam
http://xanadu.com.au/ Chief Scientist, Xanadu
https://glasswings.com.au/ Partner, Glass Wings
https://sericyb.com.au/ Manager, Serious Cybernetics
