The report of McKinsey reveals that the global energy transition is entering a new phase, marked by rising costs, complexity and increased technology challenges. Growing energy demand and resulting emissions could affect the pace of the energy transition, which will require a rethink of both low-carbon and fossil fuel strategies to meet the goals outlined in the Paris Agreement.

Key insights

Key insights include:

– Global energy demand is projected to grow by up to 18% through 2050, mainly driven by growth in energy consumption in emerging economies (especially ASEAN countries, India and the Middle East). – –

– Renewables are projected to grow to 65-80% of the global power generation mix by 2050 depending on the scenario.

– Notably, hydrogen demand is projected to be up to 25% lower than previously anticipated due to cost increases of 20-40% and regulatory uncertainty.

– Fossil fuels are projected to account for 40-60% of total energy demand to 2050, with fossil fuel demand projected to plateau between around 2025-2035 and begin declining thereafter.

– Key drivers of oil demand decline include EV uptake, continued plastic recycling and increased demand for sustainable fuels.

– By 2050, BEVs are projected to account for 99% of global passenger vehicle sales in the Continued Momentum scenario, up from 13% today and 71% in 2030.

– A consequential impact on emissions, which have not yet peaked and are projected to begin their decline between 2025 and 2035. Annual capital spending on physical assets is projected to grow by up to 80% by 2040.

Clean energy solutions must scale up

The analysis demonstrates that the build out of clean energy technologies has not been fast enough to meet growing global energy demand. To date, the buildout of renewable energy sources has largely benefitted from the most promising use cases or “low-hanging fruit” where policy and funding have been most plentiful.

Also see: Double investments in power distribution or lose race to net-zero

Diego Hernandez Diaz, Partner at McKinsey reflected on the findings: “To navigate this critical phase of the energy transition while keeping it affordable, reliable, and green, we need urgent action and a faster pace of change. Even with the surge in global net-zero targets, the technologies needed to reach them aren’t progressing quickly enough. Low-carbon solutions must scale up, but they’re facing an uphill battle as rising interest rates and supply chain challenges limit access to capital.”

Global price too low

Critically, the report also shows that the current pace of the energy transition could necessitate new oil production to meet energy demand, across all bottom-up scenarios. The previously anticipated fossil fuel peak at the end of this decade is now better characterized as a plateau. Simultaneously, the projections show the global carbon price is currently too low to drive the decarbonization required for the conditions of faster scenarios to be met, particularly the at-scale uptake of carbon, capture, utilization and storage (CCUS), which will be vital to mitigate more carbon intensive fuel sources.

Humayun Tai, Senior Partner at McKinsey, added: “In order to accelerate the energy transition, continued investment into CCUS and energy efficiency is essential to mitigate fossil fuel dependence. Ensuring a viable business case through the right combination of policy, financial frameworks, and incentives will be critical in driving stakeholder adoption and buildout of low-carbon technologies.”

See also: Energy transition not on track – more PV needed

The new report notes that accelerating the pace of the transition will require overcoming several bottlenecks impacting the uptake of low-carbon technologies, including electricity generation and sustainable fuels. This layered with T&D investments needing to grow nearly three-fold by 2050 to recover from under investment and accommodate for intermittent RES, demonstrates the scale of the challenge ahead. (hcn)





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The state-of-the-art facility is the world’s first Lighthouse Factory in the PV industry. It integrates more than 30 digital use cases and sets a new benchmark for high-quality development and intelligent manufacturing in the photovoltaic sector.

Vice President Haimeng Zhang highlighted the primary reasons for setting up the Lighthouse Factory: to meet the changing and diverse needs of customers and to ensure consistency in production processes across different sites.

Ensuring global production consistency through the use of fourth industrial revolution (4IR) technologies

As module manufacturing scales globally, it is critical to maintain consistency across different distributed production sites. LONGi’s Lighthouse Factory addresses this challenge by using advanced technologies such as the Industrial Internet of Things (iIoT), big data, artificial intelligence and digital twins. This approach has been recognized by the World Economic Forum (WEF), which has included the Jiaxing Lighthouse Factory in its latest “Lighthouse Factory” list.

Expansion of the Lighthouse project to other production sites

LONGi has also introduced the “Lighthouse Project”, which aims to transfer the agile intelligent manufacturing model of the Jiaxing Lighthouse Factory to other production sites. “The LONGi Jiaxing Lighthouse Factory is just the beginning,” explained Haimeng Zhang. “Our goal is to develop it into a state-of-the-art production facility that can be replicated in the future.”

See our interview with LONGi: “The PV industry is navigating a complex competitive landscape”

Improving research and development while ensuring highly efficient, digitalized manufacturing processes
LONGi has always prioritized technological research and development to increase productivity through innovation, Zhang said. The company’s progress has resulted in record-breaking performances, including a conversion efficiency of 27.30% for heterojunction back contact (HBC) crystalline silicon solar cells and an efficiency of 33.9% for perovskite tandem crystalline silicon solar cells.

Video: How AI and automation are driving LONGi’s production base in Jiaxing

The PV industry is increasingly driven by customer needs, requiring the production of modules that meet specific requirements. LONGi recognized that improving R&D is important, but it is not the only solution. Efficient manufacturing processes are essential to meet diverse customer requirements, ensure flexible production for different applications and speed up product delivery.

New Hi-MO X6 Max series is produced in the Lighthouse Factory

The Lighthouse Factory in Jiaxing will serve as the production base for the Hi-MO X6 high power back contact module and will also be the production site for LONGi’s newly launched Hi-MO X6 Max module series. These modules are characterized by the innovative TaiRay Inside silicon wafer technology and Hybrid Passivated Back Contact Cells (HPBC) and feature the rectangular silicon wafer size M11 as well as a standard size of 2382×1134 mm. According to the company, the series offers improved stability, reliability and power generation efficiency.

Also see: LONGi presents enhanced back contact PV modules

Employees benefit significantly from training measures and a modern working environment

The Lighthouse Factory has significantly improved the working environment for employees, allowing them to master digital tools, improve their skills and become high-quality employees. “This is also the biggest advantage of Lighthouse Factory,” Haimeng Zhang remarked. (hcn)





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