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Alternative Energies

OPEC Monthly Oil Market Report – August 2017

85

Windpower – a growing industry faces challenges

Among the various sources of renewable energy, wind power continues to grow strongly. According to the

BP Energy Review, global wind power generating capacity has expanded by 50 gigawatts (GW), or 12%, in

2016 to stand at 469 GW by year end. This is quite a success story, as wind power recorded a global

capacity of only 8 GW just ten years ago.

Until 2007, Germany was the top country in the world in terms of wind power capacity. It was then overtaken

by the US which showed annual capacity growth of between 27–50% until 2010, and was superseded by

China in 2011 as the leading nation in terms of wind power. In 2016, China added a further 19.3 GW of

capacity, the largest nominal capacity addition globally, to now boast a total of 149 GW, followed by the US,

which added 8.2 GW, Germany with 5.0 GW, India with 3.6 GW and Brazil with 2.0 GW. According to data

from the BP Statistical Review of World Energy, China dominates wind power with a share of 31.7% of global

capacity. It is also said to be able to produce up to 26% of its projected electricity demand by the year 2030,

according to a Massachusetts Institute of Technology study.

In terms of total power generation, wind power grew by 15.6% in 2016 to reach 960 Terawatt hours or 4% of

total world electricity generation. That is almost equivalent to the total power generation of Japan, the world’s

fifth largest power generator.

Graph 11 - 1: Composition of sources of global

primary energy consumption

Graph 11 - 2: Cumulative installed wind turbine

capacity, % share of global

In the US, renewables and natural gas have displaced a number of coal and nuclear plants in electricity

production in recent years, due to lower prices, environmental regulations and government subsidies.

According to the American Wind Energy Association, wind energy provided 4.7% of the entire electricity

generated in 2015. However, there are concerns regarding grid reliability and the resilience of renewable

energy – particularly in regards to wind and solar energy. One of the main criticisms of renewable energy is

its intermittency: turbines only produce energy when it is windy and solar panels only do so when the sun

shines. As output fluctuates with the weather, grid operators said they depend more on weather forecasting.

Storm fronts and cloud covers sometimes require grid operators to ensure that conventional power is readily

available to ensure a steady stream of supply. Nevertheless, in May of this year, a senior spokesman at the

California Independent System Operator (CALISO), said that wind and solar served as much as 67% of

CALISO's demand.

Meanwhile in Europe, a new study by the ETH Zürich and Imperial College London has combined a long-

term analysis of predominant weather patterns with Europe-wide wind electricity generation data. The study

suggests that Europe could make much better use of its wind resources if capacity was spread out

throughout the region to best benefit from varying weather patterns. Whereas traditionally there has been a

large concentration of wind farms located in the North Sea due to generous subsidies offered by nations in

that part of the continent, places such as Greece and the Balkans, which can experience as much wind as

northwest Europe, lag far behind in terms of wind power development as they do not have the same ease

of access to funds.

4,418

3,204

3,732

592

910

420

Oil

Natural gas

Coal

Nuclear energy Hydro electric Renewables

Source: BP Statistical Review of World Energy, 2017.

million tonnes

of oil equivalent

20.9%

3.6%

34.2%

0.1%

0.8%

40.4%

Total North America

Total S. & Cent. America

Total Europe & Eurasia Total Middle East

Total Africa

Total Asia Pacific

Source: BP Statistical Review of World Energy, 2017.