Decisive policy measures and greener choices by companies and consumers will be critical to accelerate the growth of renewables as energy markets “fundamentally restructure” in the years ahead, according to BP’s latest future of energy report.
The oil giant’s latest Energy Outlook report also said that global oil demand may already have peaked and may not now return to pre-Covid-19 levels and that renewable power is now growing faster than any other fuel in history.
The report expects fossil fuels to continue to give way to renewables in an increasingly electrified world where energy demand is set to rise in the decades ahead. Falling technology costs could see renewables share of the global energy mix reach almost 60% by 2050.
Although government policy measures will be critical to achieve net zero, companies and consumers also have an important role to play by switching to low-carbon energy sources. However, the report warns that the world is currently “on an unsustainable path”.
“A rapid and sustained fall in carbon emissions is likely to require a series of policy measures, led by a significant increase in carbon prices,” it said.
“These policies may need to be reinforced by shifts in societal behaviours and preferences. Delaying these policies measures and societal shifts may lead to significant economic costs and disruption.”
BP Chief Executive Bernard Looney said the analysis in the report shows that, with decisive policy measures and more low carbon choices from both companies and consumers, the energy transition can still be delivered.
“It is one of the reasons I remain optimistic about the future and I hope readers will find the report helpful as we all try to make a difference.”