The oil industry may be underestimating to its own peril the potential of renewable energy in the decades to come, the World Petroleum Congress in Johannesburg heard on Wednesday.
The president of the Worldwatch Institute, Christopher Flavin, said the perception that ”real energy men don’t do renewables” is changing.
Wind turbines, solar power and biofuels are growing in popularity and becoming ”real bandwagon technologies”.
While oil accounts for about 30% of the world’s energy use today, renewable energy sources made up 2%. However, the market share of renewable energy sources is growing at a tremendous rate.
Between 1994 and 2004, the use of wind power grew by 30% yearly, while solar power grew by 23%. Oil, by contrast, grew by less than 2% per year over the same period.
US lags behind
The United States is lagging behind in the use of renewable energy, as it contributes only 4,2% of that country’s energy.
In Sweden, 25% of energy comes from renewable sources, and in Norway 45%. Germany is the leader in wind power generation. Canada is the world leader in hydropower, while Brazil is the world’s largest ethanol producer.
Flavin said the energy industry is at the same point at which computer companies Microsoft and IBM found themselves during the 1980s.
The renewable-energy industry is comparable to that of Microsoft. Having decided to focus on the personal-computer market, Microsoft was written off as a competitor.
”That is the position the world industry is in today. Remember the magic of exponential growth. That is what took the cellphone and computer industries to where they are today.”
Flavin said companies such as Shell, BP and Mitsubishi invested $30-billion in the renewable energy industry during 2004.
Government policy is critical, he said.
”Country after country is announcing new policies, literally weekly. Forty-eight countries now have renewable-energy incentives on the books.”
Right policies need to be in place
The contribution of renewable energy will either be driven or inhibited by government policies, the vice-president of Royal Dutch Shell’s global hydrogen business said.
”We believe that with the right policies in place, there can be an impact,” Jeremy Bentham said.
Flavin said the power production of wind turbines, no longer like ”grandfather’s windmills”, has increased from 50 kilowatt hours (kwh) to 1 500kwh, while the cost of generating electricity from wind has decreased from 46 US cents per kwh in 1980 to less than six cents in 2005.
The use of solar panels on rooftops has grown by 30% in the past five years. In Japan, about 200 000 homes have their total electricity needs met in this way.
”This technology tends to get dismissed a little too easily. Many cities globally have the potential to generate at least half of their electricity in this way,” Flavin said.
The use of solar water heating has grown by about 25% in recent years. In China, 35-million homes have their hot water provided by solar cells.
”Both the Chinese and the Japanese are showing the world how to get production costs to much lower levels.” — Sapa