Global grid capacity needs to grow 2.5 times its current size, and annual expenditure on grids must more than double to US$970 billion by 2050, according to a new report from DNV.
The consultancy firm has published its New Power Systems report, which shows that global electricity demand will double by 2050.
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Despite a rise in global grid expenditures from 15% to over 25% of annual energy expenditure by 2050, efficiencies in grid technology and increased electricity distribution will likely keep consumer grid charges stable or declining in most regions.
Frequent readers of PV Tech will have noticed the increased coverage of grid issues in the past few months, as they have been an ongoing challenge globally. In the US alone, over 1TW of solar PV capacity is awaiting grid connection, according to a recent report from Lawrence Berkeley National Lab (LBNL).
Although it is difficult to project future electricity unit costs, DNV says consumer prices are unlikely to rise, as suggested by the consistent decline in renewable power costs.
Ditlev Engel, CEO of Energy Systems at DNV, said: “There will be no transition without transmission. The new energy system will require data-driven solutions and policies that address all interconnections, from permitting to the integration of AI and cyber-resilience. Planning for a new wind farm must include a strategy for grid connection; similarly, GETs and new wire integrations require IT upgrades at most control centres.”
The report concludes that grid expansion is affordable due to growing grid technology efficiency and the increased electricity load.
Solar and wind to dominate electricity generation
By mid-century, electricity will constitute 37% of global final energy use, a substantial rise from 20% in 2023. Wind and solar energy are anticipated to generate half of the world’s electricity by 2040 and 70% by 2050 and the decarbonisation trajectory predicts that nearly 90% of electricity will be sourced from non-fossil sources by 2050.
Furthermore, global installed solar-plus-storage capacity will reach similar levels to standalone solar PV by mid-century with over 500GW.
Role of AI in power use
The report does not forecast the power demand of data centres serving AI applications globally, but DNV will present an estimate in its 2024 Energy Transition Outlook later this year. In theory, AI has the potential to introduce efficiencies in both the provision and use of power.
Remi Eriksen, group president and CEO at DNV, said: “Deep digitalisation, including the application of AI, is crucial for managing the increased complexity of a renewable-dominated power system.
“There will be a rapid growth in both information technology and operational technology in the coming years, which must be supported by a robust approach to risk management, particularly in cyber security, to reap the benefits of the new power systems.”
This story was first published on our sister site Current±.
