Renewable energy sources, such as solar and wind, have steadily come down in price. This has helped them take a larger bite of market share. In fact, they are considered established enough that many governments are withdrawing subsidies and other programs intended to help foster the industry when it was in its infancy.
As of 2017, renewable energy constitutes nearly a third of global energy stock. They are especially well established in developed countries. As one example, about 56 percent of Germany’s energy capacity is based on renewable sources.
However, the industry still faces some challenges ahead. Those include difficulty in making a comparison between renewable energy and traditional energy and the need for better storage capacity.
All planning and investing decisions require some means to make a one-for-one comparison between different solutions. Renewable energy works fundamentally differently from conventional energy, making it inherently challenging to make this comparison. This is a challenge for investors and for developers alike.
Another major challenge for the renewables sector is the need for more and better storage. Unlike traditional energy production, which is relatively steady in nature, the production of renewable energy varies substantially.
This may be obvious to anyone when it comes to solar power, where production capacity disappears at night and reappears each day, but it is even more extreme for wind power, In many places, they have to essentially turn the system off or turn it down when a big storm rolls in because the amount of energy being generated overwhelms the system and threatens to permanently damage parts of it.
This means that a lot of potential energy actually gets wasted because we lack adequate capacity to either distribute it or store it for future use. Storage has proven to be a surprisingly hard problem to solve. However, they are working on it. The energy storage industry is expected to hit $4 billion by 2024.
This is good news for those worried about climate change. The only thing better than renewable energy is using “no” energy alternatives, such as passive solar design. However, that generally requires designing the built environment with little to no need for energy from the start. It doesn’t work well to try to retrofit buildings with passive solar, making renewables the logical force of nature.