BP predicts a 400% growth in renewable energy by 2040

BP has published its yearly forecast for the global energy market this week, and the oil giant sees renewable energy playing a commanding role in the future.

By 2040, if current trends continue then renewables will grow by 400 percent of their current amount, but still only account for 14 percent of all global energy demand.

This expansion will be led by China, which could continue its dominance in the market, followed by other developing countries, including India.

BP sees this strong growth as being enabled by the steep decreases in cost seen primarily by wind and solar. As subsidies are phased-out by the mid-2020s, renewable energy will “be able to compete against other fuels”.

However, this view is not in keeping with other scenarios which show that wind and solar are already cost-competitive with fossil fuels.

Elsewhere, the Energy Outlook sees a continued increase in energy demand, led again by China and India, but that improvements in efficiency will help dampen this down.

More worryingly, the Outlook sees carbon emissions rising by 10 percent out to 2040. Although this is slower than in the past it remains insufficient to meet the goals of the Paris climate Agreement.  

Bob Dudley, the group’s chief executive commented that “We need a far more decisive break from the past” to limit warming to below 2 degrees.

“In BP, we continue to believe that carbon pricing must be a key element as it provides incentives for everyone to play their part – from consumers using energy more efficiently to producers providing more low-carbon forms of energy.”

Spencer Dale, BP’s chief economist, said that growing competition is helping to create “the most diverse fuels mix we have ever seen”.

“By 2040, oil, gas, coal and non-fossil fuels each account for around a quarter of the world’s energy. More than 40 percent of the overall increase in energy demand is met by renewable energy”.

“We are seeing growing competition between different energy sources, driven by abundant energy supplies, and continued improvements in energy efficiency”, he concluded.