Grid parity for renewables will be reached before 2025.
That’s the prediction from business services firm Lloyd’s Register, which suggests decentralised solar power will be cheaper than electricity from the grid by as early as 2022, followed by wind in 2024.
These tipping points towards a decarbonised energy system are expected to first occur in China and Germany respectively.
The report, which is based on a survey of 792 executives working in the renewable energy sector, suggests a decisive, mainstream tilt in the energy balance will take longer.
It expects clean power sources to surpass fossil fuels in countries’ energy mixes in Europe and North America by 2025, in the Middle East by 2028 and in Asia Pacific and Africa around 2033.
The survey results suggest improvements in grid connection, transmission and storage are needed before this can happen.
Most of the executives questioned believe technological advances will do more to improve the economic case for renewables than policy factors but are aware regulations remain a potential inhibitor in both developed and developing markets.
This is largely because uncertainty over returns constrains technological innovation in many firms by increasing the potential costs of deployment.