A new study has found that only 1 in 10 of the world’s electric utility companies is prioritising clean renewable energy over fossils fuels. The research by the University of Oxford and published in the journal Nature Energy states that a majority of the 3,000 utilities under consideration are still persisting with non-renewables and some are even expanding their investment in such energy sources. Three-quarters of the utilities did not expand their energy portfolios, making little change to it over the years.
Of the remaining one-fourth, few companies grew their coal portfolio compared to other assets, while half prioritised gas and the rest focused on renewables growth. Ominously, 60 per cent of the utilities that are actively growing their renewables capacity had not ceased expanding their fossil-fuel portfolio. Only 15 per cent have reduced the latter. Just 10 per cent of the companies are expanding their renewable energy capacity at a faster rate than that for their fossil fuels. This is especially concerning since utilities need to urgently transition to clean energy if the worst of climate change is to be averted. The author of the report, Galina Alova, said the research highlighted ‘a worrying gap between what is needed’ to tackle the climate crisis and ‘what actions are being taken by the utility sector’.
The study used a machine-learning technique to analyse the investment strategies and activities of more than 3,000 companies over the past two decades. It is the first study to investigate electric utilities on a global scale. Many of the industry giants are investing in low-carbon energy and green technologies to replace their fossil fuel power plants. However, evidence suggests that many utilities are still committed to fossil fuels and are yet to embark on meaningful changes to their portfolios.
The report found that 10 per cent of utilities favoured expanding their gas portfolio. Most are US utilities, due to the country’s shale gas reserves, followed by Russia and Germany. In some good news, only 2 per cent of utilities are prioritising their coal-fired power capacity ahead of renewables or gas. Many of these are Chinese utilities, which contribute more than 60 per cent, followed by India and Vietnam. A majority of companies that are prioritising renewable energy are based in Europe.