In 2020, renewable energy made up 21% of the total energy produced, second only to natural gas and beating coal for the first time.1
The renewable energy industry continues to grow both in Colorado and across the country. In 2020, renewable energy made up 21% of the total energy produced, second only to natural gas and beating coal for the first time.
Colorado’s 2021 legislative session, which wrapped up in June, continued to push new policies to help support the advanced energy industry.
These included direct benefits such as measures to create transparency surrounding the cost of renewable energy permits2 and incentivizing utilities to develop innovative energy technologies3 and indirect measures, such as a requirement for large buildings to track their energy performance4 and requirements to reduce greenhouse gases and adopt protections for disproportionately impacted communities.5
These indirect measures will likely benefit the advanced energy industry as Colorado and our utility providers continue to seek ways to improve the percentage of renewables on our energy grid and clean our air and water.
Renewable energy contracting and development is not the result of short-term decision-making, but often involves years of due diligence, negotiation, and construction to get a 20-to 35-year contract up and running.
This year, Colorado’s annual solar energy capacity is expected to more than double, as investors and utilities seek to capitalize on our more than 300 days of sun per year.6 This projected doubling comes on the tail end of a 46% increase year over year from 2020.
As we look to the back half of 2021, we anticipate that many more renewable energy projects will continue to come online, and more renewable energy deals will continue to be signed as Colorado continues to exert pressure to work toward the state’s goal of having a 100% renewable energy grid by 2040.
On the energy generation side, solar will likely continue to dominate renewable energy deals. That said, green hydrogen will likely become cost competitive with solar in the near future and we may see an increase in this deal flow.7 Green hydrogen is produced by electrolysis that is powered by renewable energy resources. There may be opportunities beyond the forefront of commercial-scale green hydrogen projects.
While the growth of renewable energy generation is important, the advanced energy market needs to be supported beyond generation. As we look to the back half of 2021, we anticipate growth outside of energy generation in two main areas: energy storage and electric vehicle charging infrastructure. These are both necessary and key pieces to the renewable energy transition.
Energy storage is critical to creating a reliable, renewable energy grid as the sun does not always shine and the wind does not always blow.8 As a result, we need to store the renewable energy we produce to help avoid blackouts and keep the grid running. Energy storage is not merely limited to battery solutions, which may pose a substantial environmental risk.
There are a number of other energy storage technologies that do not have the same environmental risk, and several startups that are seeking solutions to mitigate that risk.9 We expect to continue to see market disruption in the energy storage space and increased battery storage deployment.
Colorado and many others have a goal of getting to 100% zero emission vehicles.10 The vast majority of zero emission vehicles are electric vehicles, which requires charging. In order to efficiently charge vehicles, a sizable electric load is required.
As a result, we not only expect to see increases in construction and upgrades to substations and distribution systems in order to provide that power to the charging station, but we also expect to see an increase in the types of chargers, different technology providers, and products related to charging. Any side of electric vehicle charging presents substantial business opportunities in both the public and private sectors.
Furthermore, some electric car companies have committed to placing electric vehicle chargers at each state park in Colorado.11 It is unlikely gas stations have the electricity capacity to fully support a transition to electric vehicles due to the change in load requirements and lack of proper infrastructure.
As installing the number of chargers we need may result in a somewhat substantial capital investment, we may see different business opportunities related to where chargers are placed and different methods of investment to attract individuals to those charging stations. In 2018, more rural portions of the state bet on electric vehicle chargers as a way to boost their economies.12
As the advanced energy market continues to grow, we will likely continue to see other renewable markets come to exist and strengthen. There is an opportunity now for businesses to be at the forefront of what’s next. Whether it is on the generation side through green hydrogen, helping stabilize the grid through energy storage, or supporting our transition to zero emission vehicles through electric vehicle charging stations – the advanced energy economy presents a myriad of opportunities for people in all industries.
This article was originally published in ColoradoBiz.