ARKANSAS, Nov 23 (Future Headlines)- A groundbreaking analysis by climate analytics non-profit TransitionZero reveals that investing in global grid upgrades is not only a crucial step in preparing for the surge in renewable energy capacity but could also yield savings of $3 trillion in the clean energy transition by 2040. This ‘first-of-its-kind’ analysis covers 163 countries, representing 99% of the global population. It underscores the significance of modernizing power grids to accommodate the imminent influx of diverse renewable energy sources, emphasizing the potential economic benefits and cost-effectiveness of proactive grid investments.
The research estimates that an extra $1.7 trillion in investment for transmission infrastructure may be necessary between now and 2040 to support the global clean energy transition. Implementing extensive grid upgrades and clean energy infrastructure could save countries collectively $3 trillion in capital costs associated with achieving net-zero targets.
Upgraded power grids could transform many countries into clean power exporters, leading to additional economic gains. The International Energy Agency (IEA) predicts the need for 1.5 terawatts (TW) of additional electricity transmission cables and grid upgrades over the next two decades.
The analysis compares the costs of building a global net-zero power system under optimal transmission expansion against constraints on transmission and interconnector deployment (business as usual scenario). TransitionZero calculates the $3 trillion savings based on the difference in costs between the two scenarios, showcasing the economic advantages of prioritizing grid upgrades.
Matthew Gray, CEO and co-founder at TransitionZero, highlights grid modernization as a “blind spot of the net-zero transition,” emphasizing the critical need for open data and timely infrastructure development.
Gray underscores the urgency, stating that time is the main challenge, and any delay in grid investment decisions results in the construction of more expensive capacity, such as nuclear and biomass.
- Regional Breakdown
Investment Needed: $71 billion over the next 20 years.
Additional Capacity: 74GW of transmission and interconnector capacity.
Savings Estimate: $350 billion for Europe’s net-zero transition.
Investment Needed: Double the current capacity, requiring 289GW by 2040.
Savings Estimate: $1.9 trillion in the US.
Investment Needed: 500GW of transmission and interconnector capacity by 2040.
Savings Estimate: $557 billion for China in its drive to reach net-zero.
- Future Energy Outlook Tool
Launch at COP28: The findings will be officially launched at the upcoming COP28 UN Climate Summit in Dubai.
Open-Source Tool: The research is based on an open-source tool named the Future Energy Outlook, designed for planning and financing the global clean energy transition.
COP28 Summit: More than 60 countries and regions, including the US and EU, are expected to advocate for a collective target to triple global renewable energy capacity to reach 11TW by 2030.
Grid Upgrade Urgency: The increased renewable energy capacity targets underline the urgent need for concurrent global power grid upgrades to facilitate efficient deployment.
Reporting by Kevin Wood; Editing by Sarah White