April 26, 2018 Read More →

Extent, Speed of China-India Renewable Energy Push Surprises BP Analysts

EURACTIV:

The pace at which India—and China in particular—have developed solar power came as a surprise to BP analysts, the company’s chief economist told EURACTIV in an interview.

When oil and gas major BP published its 2018 Energy Outlook last February, the group’s chief executive underlined in the report’s foreword that “a core theme” of this year’s edition “is the speed of the transition underway.” Speaking to EURACTIV in Brussels this week, BP’s chief economist, Spencer Dale, went further, acknowledging that the company had made a “mistake” in evaluating the speed of the transition.

“We don’t pretend we haven’t made this mistake – we have made this mistake,” Dale admitted, saying BP has “revised up” its renewable energy growth forecasts as a result. “A lot of the explanation is solar,” Dale pointed out, explaining that the impressive growth in solar PV worldwide followed a typical “learning curve” where the costs come down roughly by 25% every time solar capacity doubles.

“We haven’t been surprised by the steepness of that curve,” Dale pointed out, but rather by “how far along the curve” the world has got, particularly in China and India.

For BP, the surprising figures are “telling us less about solar energy and more about the pace of the energy transition in China. And the pace at which essentially they’ve reduced their share of coal and filled up that hole with solar energy,” Dale said.

The pattern is a familiar one. For years, the International Energy Agency (IEA) and oil majors such as BP and ExxonMobil have consistently tended to underestimate renewables growth in their annual energy outlooks. In Brussels, the European Commission, the EU’s executive branch, recently admitted it was taken by surprise by the rapid fall in renewables costs and recently updated its own projections based on new evidence.

More: BP Confesses ‘Mistake’ In Forecasting Renewable Energy Growth

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