Article by: Pornphimol Winyuchakrit (Ph.D.)
In the present, all already know the “COVID-19” pandemic, which is one of the world’s severe plagues. This pandemic began in the late 2019, and it has spread widely and intensified since early 2020. Countries have been locked down to limit the risk areas of the spreading. Undoubtedly, the measures can greatly reduce the spread of the pandemic, but it causes broad contraction of not only the economic but also the development of renewable energy (RE) technology.
The COVID-19 pandemic has a huge effect on investment as well as expansion in RE technology. Of course, that will disturb an endeavor in the future to “limit the global average temperature rise below 2 degrees Celsius compared to the pre-industrial level” under the Paris Agreement, which is an international treaty for participation in tackling climate change.
Implementation of area locking down and social distancing leads the declining travel demand, especially for air transport, and shrinking economic activities. It is expected that energy demand will drop by more than 6 percent in 2020. Additionally, the International Energy Agency (IEA) estimates that the GHG emission level will drop approximately by 8 percent this year, which it is the lowest declining since 2010[1].
Share of electricity generation from RE was around 28 percent of the world’s electricity generation in the first quarter of 2020. It increased from 26 percent in the same period of 2019 (see Figure 1). IEA estimates that growth of electricity generation from RE will decline this year, resulted from economic contraction. In addition, biofuel production in the transport sector is expected to decline by about 13 percent this year. Heat production from RE in the industries has also shrunk due to reduction of production volume. However, the expansion of RE projects is expected to begin again in the next year. Solar investments or rooftop installations in households may begin more slowly without any support from the government.
Although reduction in activity during the time of spreading pandemic will result in lower energy consumption and GHG emissions, bringing about shrinking investment in RE rapidly, that will be an interruption for a period of time. Rapidly declining price of RE technology which can compete with the price of fossil still is an important driver of Thailand’s clean energy development opportunities in the next coming year.
[1] International Energy Agency (IEA): CO2 emissions: Short-term shock does not guarantee sustained decline, IEA, https://www.iea.org/articles/the-impact-of-the-covid-19-crisis-on-clean-energy-progress (2020)
[2] International Energy Agency (IEA): Renewable electricity capacity additions, 2007-2021, updated IEA forecast, IEA, https://www.iea.org/data-and-statistics/charts/renewable-electricity-capacity-additions-2007-2021-updated-iea-forecast (2020)