BP: 'two sides to the renewables story'
Renewables were the fastest growing form of energy in 2014, but the sector's progress can be viewed as a "glass half-full' or half-empty", according to BP's chief economist.
Writing in BP’s the oil and gas giant's influential Statistical View of World Energy, released on Wednesday (10 June), Spencer Dale said there were “two sides to the renewables story”.
He wrote: “On one side, there’s the fact that the growth in renewables accounted for almost a third of the total increase in primary energy in 2014, and provided more than 40% of the increase in power generation. These are big numbers.”
“On the other side of the coin – a more ‘half-empty’ story – is that renewables energy growth in 2014 remained robust at 12%, but that’s below the 10-year average of 15.4%.
“This slowdown was driven by wind which grew at less than half of its 10-year rate, reflecting both less public policy support (in EU and US) and low wind speeds (in China). Overall, renewables only provided 3% of primary energy.
Dale attributed the unusual statistical profile to a sharp slowdown in the global consumption of energy (0.9% growth – well below the 10-year average of 2.1%). Simply put, renewables accounted for a “larger share of a smaller pie”, said Dale.
The increasing importance of renewables was part of a “broader shifting in some of the tectonic plates that make up the energy landscape,” according to BP chief executive Bob Dudley.
Another major trend in the past year was the 0.5% growth in global CO2 emissions from energy. This was the slowest growth rate since 1998, other than in the immediate aftermath of the financial crisis.
The stall was attributed to industrial changes in China, where the economy grew by more than 7%, but energy consumption grew by only 2.6%. The world’s largest polluter has recently made bold commitments to reduce coal use and increase renewables generation.
“Is what we’ve seen in China the start of a new trend?” asked Spencer Dale. “Or, is it likely that this slowdown in Chinese energy demand and coal consumption is just a one-off and may be reversed? I think the jury is still out on that.”
Despite Dale’s uncertainty, the growing prominence of renewable and climate change is reflected in recent board-level decisions at BP.
The firm was one of six European oil and gas companies who wrote to the UN asking for a global price on carbon, and the company will also be more open about its impact on climate change going forward, after 98% of shareholders backed a resolution calling for greater transparency.
Video: BP Statistical Review of World Energy 2015 - Overview