If you ever dreamed about what the year 2022 would look like, you might not have envisioned wind farms spinning with a view of New York City in the background.
2022 will be a big year for renewable energy. Big projects have been approved and more customers will place a focus on the environment. Still, it won’t be without its headaches stemming from supply chain disruptions due to the pandemic.
Here are four things to watch out for in the renewable energy space in the year ahead:
1. More government renewable energy projects approved
As 2021 came to a close, big government projects were announced to help move the country’s big cities to 100% clean energy. Before leaving office, then-New York City Mayor Bill de Blasio announced a $191 million investment in offshore wind turbines that will help the city reach a goal of 100% clean electricity production by 2030 and complete carbon neutrality by 2050.
“The climate crisis is real,” de Blasio said in a release. “New York City will serve as the model for taking climate action and growing the offshore wind industry with a real long-term vision plan focused on equity. We have the opportunity now to deliver on promises and set the city on a path towards a sustainable future.”
Currently, offshore wind farms only generate less than 1% of the world’s electrical power. But according to the International Energy Agency, the market will expand fifteen-fold and transform into a trillion-dollar industry by 2040. That means more spinning wheels across landscapes throughout the country.
2. Supply chain disruptions
It doesn’t matter what industry you work in or what you’re trying to purchase – these days, everything from baby cribs to solar panels is delayed and a victim of supply chain disruption.
According to the consulting firm Rystad Energy, as much as 56% of worldwide utility-scale solar projects could be delayed or canceled in 2022 due to supply chain disruptions.
The problem stems from the fact that when production picked back up after the pandemic forced factory shutdowns, there wasn’t enough raw material to keep up with the demand for solar panels. This, paired with skyrocketing shipping costs, threatens many projects.
3. Retail electricity providers will continue to grow
Legislators across the country are passing bills to help residents save money on their electricity by utilizing retail energy providers.
Hundreds of retail electricity providers, which essentially are third-party intermediary software companies, enter into PPAs with the large-scale project and then pass on the renewable energy credits to multiple off-takers, or residents, to help lower electricity prices but take advantage of the local clean energy in the grid.
According to Consumer Reports, 48% of Americans said they’d be willing to pay $5 more for clean energy, but it often costs less with retail energy. Expect more clean-energy offers for local residents as large-scale projects want to offload their PPAs quickly to turn a profit.
4. Consumers prioritize environmental justice
According to a study done by GreenPrint, 64% of Americans are willing to pay more for sustainable products. However, 74% of buyers don’t know how to identify if a project is made sustainably.
78% of people are more likely to purchase a product that is clearly labeled as environmentally friendly. However, 53% of Americans never or only sometimes believe such claims. 45% of Americans said a third-party validator would lead them to believe the sustainability claims.
“Businesses are in a bind. Broadcasting sustainability would capture an untapped consumer base but also sow distrust,” Pete Davis, CEO and co-founder of GreenPrint, said in a release. “We’d suggest they follow the data. Third-party validation helps certify progress in the eyes of consumers.”
As 2022 continues, expect more companies to find tasteful ways to tout their sustainable practices.
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