Energy sector struggles with decarbonisation.

Wednesday 28 August 2024

New findings unveiled by the renowned global consultancy firm, McKinsey & Company, have highlighted a significant shortfall in the energy sector’s progress towards achieving their decarbonisation targets in Europe and America.

According to the report, critical projects like offshore wind are predicted to receive the final green light only after 2030, jeopardising the likelihood of countries meeting their Paris Agreement commitments by 2030.

Specifically, the solar industry is facing challenges in meeting the 2030 capacity goal of 600GW, with projections indicating that only about 390GW will be operational by the deadline.

Furthermore, the research indicates that there is a substantial gap in Carbon Capture, Utilization, and Storage (CCUS) capacity, with a projected pipeline of 148mpta by 2030, but 44mpta is still pending approval.

On a slightly brighter note, offshore wind projects are closer to meeting their 2030 target of 176GW, with only an 18GW deficit remaining to bridge the gap.

Humayun Tai, a Senior Partner at McKinsey, emphasised the crucial role of coordinated deployment of various technologies in transforming the energy system. He warned that any delays in one sector can lead to cascading effects that hinder the progress of other technologies.

‘The current industry challenges are exacerbated by factors such as inflation, system shocks, geopolitical uncertainties, and international supply chain disruptions,’ Tai explained. ‘It is imperative for companies to revisit their strategies to accelerate the transition to a sustainable energy ecosystem.’

Are you passionate about driving sustainable change in the energy sector? Join our vibrant community of like-minded individuals committed to achieving net-zero emissions. Sign up for one of our membership tiers to access exclusive content and stay informed about the latest developments in the industry.