Monday, 6 June 2016

Global Renewable Energy Market Driven by Promising Performance of Emerging Economies

Renewable energy is a range of various types of energy obtained from sources that aren’t exhaustible. Such resources include solar power, wind power, ocean power, including tidal power, geothermal power, and biofuels such as biogas. The use of renewable energy has reduced mankind’s dependence on fossil fuels, which drastically reduces the amount of pollutants released into the atmosphere and various other adverse effects that fossil fuel consumption has on the world. The rising scarcity of fossil fuels and the increasing awareness about the adverse effects of fossil fuels have driven the global renewable energy market in the last few decades.

The renewable energy field is expected to undergo steady, sustained growth in the coming years as a result of the growing public and governmental support. According to the International Renewable Energy Agency, the share of renewable energy in global electricity generation will double upon its current values by 2030. Renewable energy is expected to account for 40% of the global electricity production by then.

What are the major restraints on the global renewable energy market and how can market players overcome them?

Renewable energy is a rapidly growing part of the global energy sector. However, the market is currently constrained by the high prices of renewable energy infrastructure, which drive up the cost of the electricity generated from it. This is a major restraint on the global renewable energy market, since electricity is a highly cost-sensitive commodity and can be supplied at much lower costs by using conventional fuels such as coal.

Intensive research into increasing the efficiency of renewable energy generation infrastructure has thus emerged as the most promising research avenue for players operating in the market. Boosting the research efforts in the renewable energy field will also help eliminate another major restraint on the global renewable energy market: The intermittent nature of power generation from renewable energy resources.

Which regional renewable energy markets are likely to be influential in the coming years?

According to the latest figures released in the Renewable Energy Country Attractiveness Index (RECAI), the U.S. retained its top spot in the global market. The early adoption of renewable energy sources in the region and the steady support given to the renewable energy sector by successive governments are responsible for the proliferation of opportunities in the renewable energy sector in the country.

However, the most important point to take home from the RECAI is the steady rise of developing countries up the table, along with a corresponding fall in the rankings of developed European countries. China and India occupy the second and third positions on the RECAI and are emerging as major markets for renewable energy. Other dynamic economies such as Chile, Brazil, and Mexico also made the RECAI top 10.

The latest RECAI is dominated by developing countries to such an extent that half of the 40 countries in the RECAI are considered emerging economies. African countries had a strong run in the RECAI as well, with the continent represented by four countries in the top 30. This is set to be a major trend in the global renewable energy market in the coming years, with emerging countries actively looking to increase their network of renewable energy infrastructure.

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