We already knew solar and wind are better investments than nuclear or natural gas, and now we find they’re already better than oil.
In Impact Lab 18 September 2014, $100B invested in wind or solar will produce more energy than oil,
Kepler Chevreux, a French investment bank, has produced a fascinating analysis that has dramatic implications for the global oil industry. The investment bank estimates that $100 billion invested in either wind energy or solar energy — and deployed as energy for light and commercial vehicles — will produce significantly more energy than that same $100 billion invested in oil.
The implications, needless to say, are dramatic. It would signal the end of Big Oil, and the demise of an industry that has dominated the global economy and geo-politics, for the last few decades. And the need for it to reshape its business model around renewables, as we discuss here.
“If we are right, the implications would be momentous,” writes Kepler Chevreux analyst Mark Lewis.
“It would mean that the oil industry faces the risk of stranded assets not only under a scenario of falling oil prices brought about by the structurally lower demand entailed by a future tightening of climate policy, but also under a scenario of rising oil prices brought about by increasingly constrained supply. “
The main argument from Lewis is that oil prices could stay so low that it is no longer economic to bring in high cost new oil fields. But even if the oil price does rise, it will not be able to compete with renewables such as solar and wind.
The most striking conclusion is that by using wind or solar to charge electric vehicles, more energy is produced per dollar invested than with oil — in the case of onshore wind, it is four times as much energy for the same amount of money.
It’s already 18 months since we discovered Google had spent a billion dollars on solar and wind, which is about as much as the cost overruns on that boondoggle at Plant Vogtle, and already has operational from that investment almost as much energy generation as those new nukes at Plant Vogtle are supposed to produce, if they ever go online.
And it’s been six months since we found out that by Sabal Trail’s own figures it would take half the acreage to produce just as much solar power as that Sabal Trail fracked methane pipeline is supposed to produce.
So how about we forget about nukes and gas and oil and get on with solar and wind power?
It’s not technology or economics that are holding us back. Could it be fossil fuel companies contributing to political campaigns?