By Megan Darby
LONDON, 02 FEBRUARY 2017 (CLIMATE HOME) — Fossil fuel giants are vastly underestimating the disruptive power of solar panels and electric cars, which could see coal and oil demand peak by 2020.
That is the conclusion of a report by the Carbon Tracker Initiative and Grantham Institute published on Thursday.
Energy companies pursuing business as usual are in for a rude awakening, by this analysis, with many mines and oil fields likely to become surplus to requirements.
Based on dramatic cost reductions in recent years, the model foresees these two technologies taking a 10% chunk of market share from carbon majors in a decade. That may not sound like much, but was enough to devastate the US coal sector.
“If people are just waiting on policy to happen, they could get bitten by clean technology coming up behind them,” said James Leaton, an author of the report.
Solar panel costs have fallen 85% in the past seven years and car battery costs 73%. Despite these advances, the traditional energy companies continue to forecast linear growth at best.
BP predicts electric cars will make up 6% of the market by 2035. Carbon Tracker reckons a third is feasible.
Exxon Mobil expects all renewables to supply 11% of electricity in 2040. Carbon Tracker says solar alone could produce 23%.
It is not enough to meet the Paris Agreement upper limit on global warming of 2C, but bends the curve to 2.4-2.7C, compared to 3-4C under industry scenarios. Policies targeting other sectors would bring the international climate goal within reach…..PACNEWS [/restrict]