The benefits of renewable energy are obvious: it’s giving us a cleaner, healthier and more sustainable planet to live on.
But clean energy is also a massive contributor to the economy.
A recent report says that “advanced energy” is a $1.4 trillion global industry, almost twice the size of the global airline industry, and nearly equal to worldwide apparel revenue. This is a 7% increase compared to the 2015 total of $1.3 trillion.
In fact, the advanced energy industry, which encompasses energy sources, technologies and services that are clean, affordable and secure, is also growing much faster than the world economy overall – 7% versus 3.1%.
And it is creating jobs. The industry now supports 3.3 million positions in the US alone. That’s equal to the employment provided by retail stores, and twice the jobs in construction.
What is driving its growth?
Globally, advanced energy has grown by nearly a quarter (24%) since 2011, adding $257.7 billion in revenue over six years. The top three performers were electricity generation, transportation and building efficiency, in that order, according to the report, which was prepared by Navigant Research for Advanced Energy Economy (AEE), a trade association representing the advanced energy industry.
Electricity generation remained the largest advanced energy segment globally, with $455.6 billion in revenue (up 5% over 2015).
Transportation was the second largest advanced energy segment, growing 8% last year and reaching $447 billion.
At 15%, building efficiency capped a fifth straight year of double-digit growth with a record increase, reaching $271.6 billion in revenue in 2016.
The picture in the US
In the US, the advanced energy industry generated $200 billion in revenue, nearly double that of beer sales, equal to pharmaceutical manufacturing, and approaching wholesale consumer electronics.
Advanced energy in the United States has grown by an average of 5% annually for a total of 28% compared to 2011.
What is advanced energy?
The report defines advanced energy as “a broad range of technologies, products, and services that constitute the best available technologies for meeting energy needs today and tomorrow”.
That includes things like the transmission, distribution and storage of electricity; vehicles that are powered by fuel other than gasoline or diesel; fuel production including ethanol and biodiesel; advanced industry processes (such as combined heat and power); fuel delivery and electricity generation through renewables.
Another report has reached similar conclusions.
The International Renewable Energy Agency (IRENA) says that, by 2050, renewables will add about $19 trillion to the world economy, and will create about 6 million jobs.
The increase in use of renewable energy, plus improved energy efficiency, will achieve the emissions reductions needed to keep global temperature rises to no more than 2C, according to IRENA. The aim of the Paris Agreement on Climate Change is to keep global temperature increase well below 2C and if possible below 1.5C.
IRENA says that while changing the energy landscape requires massive investment – some $29 trillion –
this only represents 0.4% of global GDP.
In addition to boosting the economy, it will create enough jobs to offset job losses in the fossil fuel industry, and of course, give us a healthier planet to live on.
Renewable energy now accounts for 24% of global power generation and 16% of primary energy supply. To achieve decarbonization, the report states that, by 2050, renewables should be 80% of power generation and 65% of total primary energy supply.