The Cost of the Energy Transition: $3 Trillion and a Global Blackout

The development of renewable energy is proceeding at a breakneck pace: in 2024, $644 billion will be spent on building new capacity. This boom leads to serious distortions in the industry and negates all the advantages of the undertaking.

The widening gap between growing global electricity demand and distribution capacity is one of the main factors driving the need to modernize the planet’s energy system.

According to research from Rystad Energy, if the world wants to limit global warming to 1.8 degrees Celsius, network infrastructure investment of $3.1 trillion. This is the only way to solve the looming problems, at least according to Norwegian researchers.

Outdated and inadequate electricity grids that do not meet new power and environmental requirements can become a serious stumbling block to the energy transition. Thus, the network connecting the source and the consumer becomes a means of transition and an obstacle at the same time.

It’s as if the world has gone crazy and is investing in what is commonly called load, rather than in what provides power. For example, electric cars and other electrically powered vehicles (scooters, bicycles and scooters) are being mass produced, but the growing network of charging stations is largely unsupported by the development of electrical grids. The new growing load is “hanging” on old networkwhich increases the risk of the entire system collapsing into a complete blackout, an avalanche-like blackout around the world.

The proliferation of mining infrastructure, as well as artificial intelligence servers, only exacerbates the problem. The entire global energy system is hanging on by a thin thread of sharply reduced energy reserves. The serious problem of energy supply is emerging with renewed vigor.

Of course, global infrastructure investment lags behind clean energy investment. It is expected that in total, up to $370 billion will be invested across all countries (30% of the total in China).

Another 18 million kilometers of electricity grid will be needed to keep pace with the electrification of cities and other communities, including new renewable energy capacity and the rapid adoption of electric vehicles. As a result, by 2030 the total length of all global power grids should be 104 million kilometers. An immediate expansion of the network by 18 million km will require about 30 million tons of copper, a raw material that is already in short supply.

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