Global electricity demand is expected to reach approximately 38,700 terawatt-hours (TWh) by 2050 according to Bloomberg New Energy Finance, up from 25,000 TWh in 2017 and driving significant new investment in power generating capacity.
Originally presented in late June at the Center for Strategic & International Studies’ (CSIS) Headquarters in Washington DC by lead author Seb Henbest, NEO 2018 reported that “Wind and solar are set to surge to almost “50 by 50” — 50% of world generation by 2050 — on the back of precipitous reductions in cost, and the advent of cheaper and cheaper batteries that will enable electricity to be stored and discharged to meet shifts in demand and supply. Coal shrinks to just 11% of global electricity generation by 2050.”
Specifically, as we covered at the time of the report’s publication, it is one of the first reports to highlight the dramatic impact of falling battery costs and the impact which such price decreases will have on the electricity mix. BNEF predicts that lithium-ion battery prices — which have already plummeted 80% per megawatt-hour (MWh) since 2010 — will only continue to tumble as the electric vehicle sector continues to build through the 2020s.
“We see $548 billion being invested in battery capacity by 2050, two-thirds of that at the grid level and one third installed behind-the-meter by households and businesses,” said Seb Henbest, head of Europe, Middle East and Africa for BNEF and lead author of NEO 2018. “The arrival of cheap battery storage will mean that it becomes increasingly possible to finesse the delivery of electricity from wind and solar, so that these technologies can help meet demand even when the wind isn’t blowing and the sun isn’t shining. The result will be renewables eating up more and more of the existing market for coal, gas and nuclear.”
Following the publication of its New Energy Outlook, Bloomberg New Energy Finance (BNEF) typically returns periodically to the findings from its Outlook to highlight one particular note or another. This week, BNEF highlighted the report’s global electricity demand forecast through to 2050.
Specifically, BNEF expects that global electricity demand will reach approximately 38,700 TWh by 2050, up 57% from current levels, led primarily by increases in China and India — though BNEF also expects electric vehicles will account for 9% of demand by 2050.
Emerging countries in Africa, the Middle East, and Southeast Asia will all see an increase in population, GDP, and access to electricity, leading to a doubling of electricity demand. Conversely, BNEF expects “demand growth” in countries of the OECD “to be anemic, or even begin to contract, reflecting a combination of improved energy efficiency, modest rates of economic expansion, and an ongoing retreat from energy-intensive industries.”