Fantastic! Unbelievable! Overwhelming!

How the huge growth of solar energy since 2019 is rapidly changing the world for the better..

This is a translation of the German-language blog of the same name from 6 June 2024 here.

The European Parliament was re-elected on Sunday. While the last EU elections five years ago were characterised by waves of large ‘Fridays for Future’ demonstrations, these have become much smaller in 2024. Nevertheless, they were very successful, especially in the area of renewable energy. In view of the major crises since 2019, this success should be valued even more highly than it already is. After all, we all know the sacrifices in terms of lives and (also mental) health, livelihoods, fears and upheavals that the coronavirus years have brought. And how much further massive fears and massive economic upheaval have been added since the start of the war in Ukraine in February 2022.

So it’s hard to believe that, parallel to these crises, there has been such a major and positive development in the solar and related sectors.

I include everything that has to do with the new global wave of electrification based on renewable energies, especially wind power and photovoltaics, in the associated sectors. In other words, the electrification of transport and heat generation as well as comprehensive digitalisation and the exponentially growing use of artificial intelligence (AI).

A new era of electrification has dawned and once again we humans can achieve great things with it. Just as we once did with the introduction of electric light, the telephone, household appliances, electric trains, machines that help in many ways, medical technology and much more.

The new wave of electrification made possible by renewables will now create the basis for healthier people on a healthier planet in many facets. Let’s first look at applications of solar electricity in transport.

Between 2018 and 2023, the number of new vehicles with electric drive systems registered each year increased sixfold globally, jumping from two per cent of new registrations to 18 per cent.

In Germany today, it is hard to believe that Volkswagen did not have a single electric car on the market worthy of the name at the time of the 2019 EU elections (the id.3 model did not arrive until September 2020). There was also only a small industrial area next to a narrow exit on the six-lane motorway around Berlin in Grünheide. Tesla has been producing its electric cars there in one of the world’s most modern car plants since 2022.

In the five years since then, Tesla has gone from hunter to hunted. This is because not only do all established car manufacturers in the world now offer a number of electric models. Rather, China and its ‘newcomers’ are now leading the development of the mass application of electric cars – with 6.3 million newly registered pure electric vehicles in China alone in 2023, the country is now leading the global megatrend at great speed.

In sharp contrast to the discussions in Germany and ahead of the EU elections (old-fashioned politicians want to lift the EU ban on combustion engines in 2035), the global market for electric vehicles continues to grow rapidly. Reports on electrification such as Ethiopia’s ban on combustion imports or the order for 12,000 electric buses from Nigeria are evidence that the world is changing rapidly for the better everywhere. And that this megatrend extends from the ‘million-seller’ e-bike to large lorries or buses and even battery-electric rail vehicles.

Parallel to this epochal change in transport, global digitalisation is accelerating further with its demands on the provision of electricity. With the mass utilisation of artificial intelligence, the demand for electricity is expected to grow exponentially in the coming years. Estimates range up to 25 percent additional global electricity consumption due to the various areas of digitalisation alone. If digitalisation is seen as an opportunity for a better life and further progress, then this is a good thing and an additional immense opportunity for renewables.

And if you see the growth in electricity demand as an opportunity and shape it accordingly, then as a country you apply wind power, photovoltaics and battery storage on a massive scale. We are also expanding grids, digitalising them and enjoying the many interesting developments and meaningful work.

In China, for example, the annual demand for electricity is growing at around the same rate as Germany due to economic growth and consistent electrification. Among other things, generation capacities and grids are being built and, following the installation of over 270 gigawatt peak DC capacity in China in 2023, there could be a significant reduction in the use of coal in the electricity sector for the first time in 2024.

Despite growth ‘once in Germany’, this would also reduce CO2 emissions for the first time – at least according to the International Energy Agency (IEA) in the following figure:

We are talking about China, which is showing the world that massive growth in electricity demand is still good business in the 21st century. And everyone is joining in because the prospect of the ‘All Electric World’ promises a better life with lower costs.

Which brings us to our core topic – the extreme ramp-up of solar & co. in generation and utilisation:

In Germany, annual new installations grew from 2.89 gigawatts in 2018 to around 15 gigawatts in 2023 – an outright five-fold increase in five years.

In total, over 3.7 million photovoltaic systems were registered by the end of 2023; as of 21 April 2024, this figure had already risen to over 4 million – a new dimension of widespread participation has been achieved since 2019 with hundreds of thousands of balcony solar systems.

In addition, there were over 2.7 million solar thermal systems at the end of 2023. Last year, these are likely to have saved the equivalent of over 750 million litres of heating oil, which corresponds to 45 per cent of German crude oil production. Not so bad and often overlooked.

Roughly speaking, this means that over six million German households have their own energy generation based on solar energy. Or just under 15 per cent of the approximately 40.9 million German households. This means that 20 to 25 per cent of people living in Germany probably have ‘something to do with solar’ in their household.

Globally, the installation of new photovoltaic systems has more than quadrupled from around 100 gigawatts in 2018 to over 440 gigawatts in 2023! This corresponds to the annual energy production of over 90 (new) nuclear power plants. Or around 350 (new) coal-fired power plant units – what progress! I recommend reading the article by Carsten Pfeiffer, a second part of which will be published shortly.

But when it comes to speed, another component of the new era of electrification steals the show.

Quadrupling – leap in stationary storage from 2018 to 2023

While the four-fold increase in new global installations of photovoltaic capacity is already a huge leap, it seems small compared to the ten-fold increase in newly installed stationary battery storage systems. Of course, the storage market is jumping from a lower level, but the speed is breathtaking and even faster than photovoltaics once was.

Personally, I think that Bloomberg is actually significantly underestimating the dynamics with the figures presented above – after all, production capacities have grown enormously, their efficiency has continued to increase and the prices for battery storage have literally imploded.

The ‘rolling storage units’ in Germany’s electric cars are already estimated to have a capacity of 100 gigawatt hours. In contrast, the pumped storage facilities in Germany, long regarded as the ‘natural limit’ for electricity storage capacities, have been ‘overrun’ with 37 gigawatt hours. And we are only seeing the beginning here, as the rolling capacities are not yet being actively utilised for the electricity grid.

Electric cars are already cheaper to produce in China than combustion engines: the price of a 100-kilowatt-hour battery for a large electric vehicle was still around 60,000 euros in 2014. In 2024, it will be available for 5,000 euros. ‘Vehicles for everyone’, such as an Opel Corsa e, would have cost €30,000 for a battery in 2014, but currently only €2,500. And it is estimated that an electric car needs around 10,000 fewer parts than a combustion engine.

The drop in prices can already be seen impressively in China. And it will certainly soon be seen among European manufacturers as soon as the cost reductions arrive here and the manufacturers finally have the courage to adjust their European pricing policy.

Word is increasingly getting around that electric cars drive better than combustion engines, and they are already more reliable than combustion engines.

All of this will continue to fuel the spread of electric mobility, albeit with a fair amount of political noise and jolting in the EU market. Combined with massive efficiency and environmental gains both locally and globally.

And so it is no wonder that we are seeing such growth curves for battery storage, which are sure to continue. For the benefit of us all.

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