A few years ago, the kind of double-digit drop in oil and gas prices the world is experiencing now because of the coronavirus pandemic might have increased the use of fossil fuels and hurt renewable energy sources like wind and solar farms.
In fact, renewable energy sources are set to account for nearly 21 percent of the electricity the United States uses for the first time this year, up from about 18 percent last year and 10 percent in 2010, according to one forecast published last week. And while work on some solar and wind projects has been delayed by the outbreak, industry executives and analysts expect the renewable business to continue growing in 2020 and next year even as oil, gas and coal companies struggle financially or seek bankruptcy protection.
In many parts of the world, including California and Texas, wind turbines and solar panels now produce electricity more cheaply than natural gas and coal. That has made them attractive to electric utilities and investors alike. It also helps that while oil prices have been more than halved since the pandemic forced most state governments to order people to stay home, natural gas and coal prices have not dropped nearly as much.
Even the decline in electricity use in recent weeks as businesses halted operations could help renewables, according to analysts at Raymond James & Associates. That’s because utilities, as revenue suffers, will try to get more electricity from wind and solar farms, which cost little to operate, and less from power plants fueled by fossil fuels.
Bannor78 on April 7th, 2020 at 16:38 UTC »
The oil companies are collapsing because there is a dispute between Russia and Saudi driving prices down. That is even worse news for renewables.
elete12 on April 7th, 2020 at 15:49 UTC »
Well fucking duh. One is impacted directly by this lack of trading and the other can still be produced in house
bitfriend6 on April 7th, 2020 at 15:20 UTC »
The thesis for this article is ridiculous, a double-digit drop in oil prices is a huge problem for any oil company in any period of history. It was never a good thing for their bottom line, only consumers. This is why cartels like OPEC exist to regulate production and keep prices high, and is why many third world countries subsidize fuel costs as a result. PV and wind turbine manufacturers aren't feeling the same pain right now because of that, although they will if prices remain low and hurt PV/wind sales.
Applied here there's no mention of something that would for certain increase oil prices: Trump's suggested oil tariff.