Sustainable Energy Trends: Small is Beautiful

Key highlights

A Carbon-Intensive Past:

In 1973, a year marked by the occurrence of the oil crisis, the global economy was mainly powered by centralised, large-scale, fossil fuel-based technology. In the same year, “Small Is Beautiful”, a book published by the economist E.F. Schumacher, appeared somewhat atypical to many, as it presented the idea of an economic model based on sustainable, small-scale, decentralised energy technologies.

A Sustainable, Decentralised Future:

Today, sustainability is increasingly at the center of the political and investors’ agenda, and Schumacher’s vision appears to be coming true, as investments in small-scale renewables and energy efficiency technologies are growing, supporting the transition to a low carbon economy. A recent survey of central bankers and finance officials sees energy efficiency as a key area of investment to stimulate the economy.[1]

Ambitious Sustainability Goals:

Sustainability standards are rapidly becoming more ambitious. For instance, nearly 1,000 private and listed companies are committed to science-based emissions reduction targets.[2] This trend is supporting demand for the installation of small-scale renewables, for more energy efficient buildings and for a range of behind-the-meter services supporting a more efficient use of energy.

Small-scale Renewables Market Growing:

The last decade was marked by an initial shift from thermal generation to renewables. We anticipate the pipeline for large-scale renewables to expand, but we expect distributed generation and small-scale renewables to form an essential part of the pipeline for infrastructure investors, with industrial, commercial and residential projects ranging from smaller solar rooftop installations to larger combined heat and power (CHP) and cogeneration plants.

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1. University of Oxford, Oxford Smith School of Enterprise and the Environment, “Will COVID-19 fiscal recovery packages accelerate or retard progress on climate change?”, May 4, 2020

2. Science Based Targets September 2020

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