As the clean energy industry scales up, it's inevitable that there will be bumps along the road. One of those bumps, we've argued repeatedly, is "full-contact" opposition from those energy sectors - fossil fuels like oil and coal, particularly - with an interest in slowing the transition to a clean energy economy. Another is a turn towards less encouraging, or even hostile, government policy, as politicians do the bidding of the dirty energy companies who finance their campaigns, and who lobby them heavily.
All this could almost be discouraging, except for one fact: clean energy is growing by leaps and bounds, with technological and economic momentum towards the scaling of cleantech that's becoming increasingly difficult, if not impossible, to stop. That's not just our view; for instance, Bloomberg New Energy Finance Chief Executive Michael Liebreich is out with a new analysis which concludes that clean energy's future - particularly once it gets past its awkward "puberty" phase - is bright, with growth that Liebrich concludes is "irreversible." Here are a few highlights from Liebrich's analysis:
- Cleantech is an industry not just "in transition," but in "[s]ix different transitions...all happening at once...which will see the emergence in due course of a fully mature and competitive clean energy sector."
- Transition #1 is a fundamental shift in the economics of clean energy, whereby "as a result of dramatic recent reductions in clean energy costs, the industry is shifting towards one where revenue from power sales – and therefore the level of electricity prices and the quality of renewable resources – drive investment."
- For instance, "In solar, we are already at the point where small-scale, residential PV can produce power at a levelized cost below the retail electricity price in several important countries."
- Transition #2 "involves the impact of renewables on the wider power sector...[in which] the percentage of renewable generation has reached a point at which it is starting to move prices, changing the returns for conventional as well as for clean energy generators."
- Transition #3 "relates to the emergence of a mature supply chain, one which will be dominated by sophisticated industrial players with advanced capabilities in quality assurance, cost engineering and investment planning."
- Transition #4 is the "calm before the storm" whereby "the uptake of electric vehicles will have a substantial impact on fuel use and transport patterns, as well as on electricity demand and the architecture of the grid."
- Transition #5 is the move from "first-generation to next-generation" biofuels.
- Transition #6 is "the shift [in cleantech] from a narrow to a broad geographical base." In this transition, cleantech is moving rapidly from being "a rich-man’s game, restricted to wealthy democracies willing to buy indulgences to assuage the guilt of fossil-fuel reliance," to one in which "clean energy will be simply another part of the energy mix, available in some form anywhere in the world, economic, ubiquitous, attractive."
In the end, Bloomberg New Energy Finance has laid out a positive, realistic analysis of where cleantech is likely to go in coming years. Whether it moves faster or slower will depend on the pace of technological change, the rate of economic scaling, and the extent to which governments encourage - or discourage - this inevitable, "irreversible," and absolutely necessary transition from fossil-based, carbon-emitting, 19th and early 20th-century fuels, to the clean, renewable, inexhaustible energy sources of the future.