Europe’s largest oil company, Royal Dutch Shell, recently released a new report that looks over half a century into the future and found a surprising outcome: solar may become the world’s largest energy resource. Recent reports from companies including UBS and the Macquarie Group have indeed outlined a promising future for the solar energy industry. UBS sees the start of unsubsidized solar, and the Macquarie Group sees great growth in the rooftop solar industry. The solar company SunPower has a year-to-date gain of 108% in their stock price so far in 2013, and is the 2nd best performer of the Russell 3,000 stocks. And while it appears multiple companies are shining light on the solar energy industry, be careful about what you take away from the Shell report.
Shell’s report, named the New Lens Scenarios, examines two different paths world energy may take in the next half century. In the first scenario, named “Mountains,” Shell sees strong government and policies that lead to plentiful natural gas resources and carbon capture and storage (CCS) technology. Interestingly, Shell currently is involved in a large CCS project in Alberta.
The “Oceans” scenario, however, sees solar becoming a dominant source of energy production, but fossil fuels would still be accounting for 70% of road passenger travel in 2050. The natural gas industry, held by competitors to Shell, also fail to materialize. So even though the solar industry grows, this scenario still sees greenhouse gas emissions totalling up to 25% higher than the “Mountain” scenario as a result of higher oil and coal demand and lack of CCS investment.
The most obvious reason to be skeptical of Shell’s report is the fact that they discontinued investment into solar, hydrogen, and wind back in 2009. Strange that they would be pushing for a technology that they stopped researching.
So while there certainly is plenty of reason to be excited about the solar energy industry, don’t think that Shell is necessarily the new champion for the solar industry.
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