Our Take, With Doug Sheridan
In the US, the new driver is energy-guzzling artificial intelligence. Demand was already on the rise to power EVs, heat pumps and other devices designed to reduce fossil fuel use.
Our Take, With Doug Sheridan
The WSJ writes, renewable electricity is growing fast. The trouble is, it can’t keep up with growing global power demand.
In the US, the new driver is energy-guzzling artificial intelligence. Demand was already on the rise to power EVs, heat pumps and other devices designed to reduce fossil fuel use.
In the developing world, the boom is driven by industrialization and basics like lights and air conditioning. That means more fossil fuels, including coal, the worst emissions offender. “The reality is we can keep adding renewables until we’re blue in the face and it won’t be enough,” said Sumant Sinha, CEO of ReNew, one of India’s biggest renewable energy companies.
America’s power-sector emissions have declined as natural gas and renewables supplanted coal. Now factories producing microchips, EVs and batteries are fueling 24/7 demand growth [that fits thermal power's profile and shows little sign of slowing. Samsung Semiconductor will more than double its semiconductor investment in Texas to $44B.
The wild card is AI, which uses more energy than conventional computing. In the US, with the most data centers, their share of electricity consumption could rise from 4% in 2022 to 6% in 2026. This could add 8% to US natural-gas demand by 2030.
In Asia, renewables can’t keep up. That growth hasn’t kept pace with demand, leaving coal to close the gap. With its big build-out last year, China did cross an important threshold—growth of renewables exceeded the long-term growth of power demand.
India encapsulates the challenge. Power-demand growth has been running above 8% a year, outpacing GDP growth, as industrial activity explodes.
Hundreds of millions of Indians whose homes have been connected to the grid this century are also buying appliances. By 2050, Indians’ air conditioners could use more power than Africa currently consumes. India has 30 GW of coal plants under construction, with more in the pipeline.
Our Take 1: Some good reporting by the WSJ here; in particular the explanation of the lay of the land as it exists today. What it misses (maybe appropriately so, since it's a "news" article... and not a forecast) is a recognition of the direction of the global energy system. Clearly, thermal energy—including natural gas and coal—looks poised to remain a massive and necessary contributor to the world economy for generations. This despite what renewables proponents and greens otherwise claim.
Our Take 2: Poor decision making and pollyandish energy policy pushing ineffectual renewables has virtually assured coal generation's share of the power market remains much higher than if cooler heads had prevailed leading up to, during and since signing of the Paris Agreement in 2015. Paris is the Pandora' box "gift" to the world. And it keeps on giving.