Energy Reimagined - Influencing outcomes of the future of energy mix
Foresight 2015 - The Ups and Downs of Batteries and Renewable Energy
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Global fossil fuel prices have slid
dramatically due to a mixture of
weakened demand and oversupply,
making the switch to renewable
energy slower.
Germany’s transition to
renewable energy by
making fossil fuels more
expensive raises the cost of
German industry, causing
industries and jobs to leave
for cheaper options.
Germany’s climate-friendly
policies are among the
world’s most ambitious (a
target of 80% electricity from
renewable sources by 2050),
and they are popular with
the German electorate.
Many renewable energy business
models today rely on a mixture of
government regulation and
subsidies, rather than cost
competitiveness, to derive profit.
Even if renewables are
cost-competitive sans subsidies,
they suffer from another
fundamental problem – irregular
supply.
Germany has rapidly developed its
renewables production capacity but
has had mixed outcomes. Energy
prices are uncompetitive; its energy
security record is mixed; and it has
not sufficiently reduced its CO2
emissions.
The Ups and Downs of
Batteries and Renewable Energy
As part of the Centre for Strategic Futures’ (CSF) foresight work, we scan and monitor key trends
regularly, and explore different ways in which these trends might play out. Two trends that CSF looked
into last year, in partnership with the Ministry of Trade and Industry’s Futures Group, were in the areas
of renewable energy and battery technology. This infographic outlines the current landscape of
FORESIGHT 201501
Rahul Daswani
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Battery capacity has been slow to
develop – increasing at the rate of
only 6% per year in the last 150
years. Most improvements in the
runtime of portable devices have
come from reducing power
consumption, rather than with
better batteries.
Battery costs may drop more
quickly than expected with
bold, large-scale investments
like electric vehicle
manufacturer Tesla’s US$5
billion Gigafactory in the
United States.
The price of batteries falls below
US$230/kWh, making renewables
much more viable.
The game-changing rise of
renewables removes current
geography-based dynamics of
energy resources.
Germany is modifying its energy
policy for a sustainable path
towards a renewable energy future
that maintains the export
competitiveness of its industry. It
will retain renewable energy
production rebates while allowing
the renewables sector to grow at a
reasonable pace and use natural gas
as a bridging fuel to achieve energy
independence, while staying on
track with emission reduction goals.
The Gigafactory takes advantage
of economies of scale to drive cost
reduction, rather than through
radical changes in battery
technology.
Risk Opportunity
renewable energy and battery technology, and explores the possibilities of where we could get to, what
stakeholders such as the private sector and government could do to get to these outcomes more quickly,
and some pitfalls that could slow us down.
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