The wind energy industry may soon overtake coal and gas in terms of growth and profits
On Friday, the US Department of Energy made several reports on the state of wind energy available to the public. The research points to an interesting trend - this industry has the potential to overtake both the coal and gas industries in terms of growth and profits.
Twenty years ago, alternative energy sources represented only 5% of the entire industry. Today, gas, oil and coal are still considered to be the pillars of the energy industry. However, if oil made up 39.8% of the industry in 2000, this indicator has dropped by almost 10% since then. The problem with fossil resources is the fact that they are not renewable. Because of this, humans have shifted focus to alternative sources, with wind and solar energy taking center stage. The US government has accepted this situation and announced plans to develop the wind energy industry. Today, 41 states are using wind as a source of energy, making up 6.5% of total energy production. This indicator reaches 30% for certain states. According to a 2019 report from Bloomberg, NEF New Energy Outlook, the share of solar and wind energy will increase from 7 to 48% by 2050. This means that these energy sources will see an eightfold increase over the next 30 years. Coal consumption will decrease to a third of its current value, oil will be completely discontinued, and there will be only 50% of the present gas reserves left.
Meanwhile, for countries like Russia (the world’s largest exporter of gas) or Saudi Arabia (the number one country in oil production and exports), these are warning signs. Fuel makes up half of the exports in the Russian Federation. Oil and gas have been important business areas for entrepreneurs since the 1990s. In Russia, the share of ‘renewable’ energy is less than 1%, according to Russian business daily Vedomosti. The article points out that the cost of wind energy production is much higher in Russia than in the States. As a result, even after the recent successful completion of a project to build several power plants based on renewable energy, the share of ‘green’ energy in the country will still be under 1% by 2024.
As for Saudi Arabia, their dependence on the oil market is obvious: in 2017, the country’s oil reserves counted 266.8 million barrels. Every day, approximately 10 million barrels are produced. The share of oil exports in the country’s GDP also makes up half of the total sum. Considering their reserves, the country can last another 50 years until an oil deficit will impact their economy. 58.7 GW of electric energy will be produced by 2030, but this figure pales in comparison to countries with higher alternative energy development like Italy, where the number of ‘green’ power plants is close to one hundred. Alternative energy is likely to become the ‘new gold’ of this century, and another gold rush is just around the corner.
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