Coal and gas will begin their terminal decline in less than a decade, according to a new BNEF analysis.
The way we get electricity is about to change dramatically, as the era of ever-expanding demand for fossil fuels comes to an end—in less than a decade. That’s according to a new forecast by Bloomberg New Energy Finance that plots out global power markets for the next 25 years.
Call it peak fossil fuels, a turnabout that’s happening not because we’re running out of coal and gas, but because we’re finding cheaper alternatives. Demand is peaking ahead of schedule because electric cars and affordable battery storage for renewable power are arriving faster than expected, as are changes in China’s energy mix.
(Image: Bloomberg New Energy Finance)
Here are eight massive shifts coming soon to power markets.
1. There Will Be No Golden Age of Gas
Since 2008, the single most important force in U.S. power markets has been the abundance of cheap natural gas brought about by fracking. Cheap gas has ravaged the U.S. coal industry and inspired talk of a “bridge fuel” that moves the world from coal to renewable energy. It doesn’t look like that’s going to happen.
The costs of wind and solar power are falling too quickly for gas ever to dominate on a global scale, according to BNEF. The analysts reduced their long-term forecasts for coal and natural gas prices by a third for this year’s report, but even rock-bottom prices won’t be enough to derail a rapid global transition toward renewable energy.
“You can’t fight the future,” said Seb Henbest, the report’s lead author. “The economics are increasingly locked in.”
The peak year for coal, gas, and oil: 2025.
Read more: Bloomberg