A new report from international strategic research provider BloombergNEF says at least US$21.4 trillion needs to be spent on global electricity grids by 2050 to reach the world’s net-zero emissions goals and restrict the earth’s warming to 1.5 degrees Celsius from preindustrial levels.
The report, “The New Energy Outlook: Grids”, states that grids worldwide are grossly insufficient for future energy needs.
Of the projected US$21.4 trillion spend on grid infrastructure, US$4.1 trillion is required to sustain existing grids, and US$17.3 trillion is needed to expand grids for new electricity consumption and production, including US$5.1 trillion on digitalisation.
To enable commitment to a spend of this scale, the report recommends significant policy intervention by government, including reducing red tape in gaining permits for projects, and providing incentives for utilities to pursue digitalisation and grid flexibility.
As bi-directional powerline networks expand during the next three decades, the report estimates 80 million kilometres in global grid growth between 2022 and 2050, which is more than enough to replace the current global electricity grid. This includes an estimated 68 million kilometres of above-ground lines, 12 million kilometres of underground cables, and 0.2 million kilometres of submarine cables worldwide.
“We must effectively double the size of the global electricity grid by 2050,” says the report’s lead author, Sanjeet Sanghera, head of grids and utilities at BloombergNEF.
“This future grid needs to be smart, flexible and responsive, enabling us to harness the full potential of renewable energy rather than be bogged down by it.
“The legacy grid was built for the industrial revolution and outperformed our wildest expectations. But the project ahead is to decarbonise the global economy by connecting terawatts of renewables and electrifying as much as possible of the end-use economy.”