In 2014, cleantech made a comeback. This year, it's growing into something more realistic, effective, and impactful. Here are 8 trends to watch.
Ready or not, renewable energy is about to hit the mainstream. 2014 was a comeback year for cleantech, and 2015 is poised to be much bigger.
I recently gave my 2015 cleantech trend predictions to the Energy Collective, which provides news and commentary on energy policy, clean technology, and climate change. They appeared alongside other media, industry leaders, and influencers.
Most of us said similar things about 2015 — more solar distribution, more electric vehicle growth, grid storage solutions — but I wanted to take it a step further. Here are the 8 biggest cleantech trends to watch in 2015.
1. New storage applications
Up until now, the biggest hurdle for renewable energy has been storage and transmission. But finally, the technology for batteries has caught up with the technology for panels, and businesses can focus more on integrating renewable systems and replacing old ones.
"2015 will be a big year for energy storage paired with renewables. The chemistry of the batteries continues to improve, driving down upfront capital expenditure, and we are also seeing vast improvements in software that can control the performance of the storage system." said Joshua Rogol, director of business development for Urban Green Energy.
He added that the applications will expand beyond resiliency and back-up power to things such as demand reduction, load shifting, and ancillary services like voltage and frequency regulation. He added these will "drive significant value for end-customers, installers, investors, and the utilities."
2. Dropping solar panel prices
The price of solar panels dropped by about 19% in 2013 and was expected to drop about 12% in 2014, according to a report by the National Renewable Energy Laboratory. The prices went from $2 per watt in 2013 to about $1.80 per watt in 2014, which is 59% below 2010 prices. That number is expected to continue to drop this year. Residential solar prices in many states are now reaching grid parity, which will be huge for the market.
3. More adoption of solar
In 2014, a new solar system was installed every 2.5 minutes in the US, which came from an overall $15 billion investment in solar power last year. According to Greentech Media Research, in 2013, a new solar system was installed every four minutes, so this is a dramatic increase. The research also showed that about 200,000 residential solar rooftops were installed. At this rate, the US could hit a million solar installations by 2016.
4. The power of big data analytics
More sophisticated analytics software is giving companies deeper insight to understand the variable nature of wind, solar, and hydro energy. It's also empowering for people.
For example, SolarCity's new app, MySolarCity, offers energy monitoring, social media, networking, and real-time energy measurements. Comparing these numbers to neighbors can also create more competition and in result, more action. It brings people closer to their energy — it no longer has to be just a depressing paper bill that comes from the utility company every month.
5. Utilities will invest in renewable energy
According to an Energy Information Administration report, investments by some utilities increased dramatically over the last five years, which is because the grid is aging and not sustainable. Roughly 70% of the grid's transmission lines are more than 25 years old, and the average power plant is about 30 years old, according to Greentech Media Research.
Utilities will have to invest in renewables because of the vulnerable, aging grid. They are also starting to be pressured to invest in them — I wrote a lot about this in my latest cover story for TechRepublic about big tech companies affecting the environmental movement. Renewable energy is the future, and utilities are going to work with people who are generating their own power more fairly as the number of solar installations and electric vehicles rise.
6. Electric vehicle infrastructure growth
In 2014, electric vehicle sales in Europe increased by 77%. US adoption is much slower, but the ecosystem and infrastructure to support electric vehicles is growing. Last year alone, electric car sales were up, Tesla open sourced its patents, and cheaper models of EVs were being made.
A few years ago, the US Department of Energy predicted that 1.2 million electric vehicles will be produced by 2015. That doesn't mean it will catch on by this year, but it is an amazing outlook that doesn't seem unrealistic with the rate of growth we're seeing.
7. More clean energy startups
There are always new trends in the startup world. As cleantech makes a comeback and gains a real foothold in the energy industry, it will also see action in the startup community. Big data, IoT, storage and transmission solutions — the energy industry is begging for disruption from the startups that tackle these problems, and entrepreneurs are starting to realize that. Hopefully venture capitalists, who stayed away from cleantech for the past several years, notice this market opportunity as well.
8. New ways to finance
Renewable energy plans and electric vehicle finance plans are already in effect. For instance, Tesla offers tax credits for their vehicles, and Ford has partnerships for discounted solar on homes to charge their electric vehicles off the grid. We should see a lot more versions of these types of partnerships and discounts this year as incentives to adopt renewable energy.
In 2015, we'll probably see many more variations on Power Purchase Agreements, especially with solar. Right now, it works like this: a third-party developer owns, operates, and maintains the system, and a customer sites it on their roof or property and purchases the electric output from the solar services provider. Problem with that is, the energy is going back to the grid and being charged by the utility company to other people, when they didn't generate it.
The typical business model for utility providers isn't sustainable, so organizations will have to figure out new solutions. Big tech companies are working to change the way states develop clean energy facilities. For example, Google has five large-scale PPAs in places like Iowa, Oklahoma, and Sweden. They've also worked with Duke in North Carolina to create a green tariff that allows companies to more easily choose renewable energy.