Between 2004 and 2014, renewable energy’s share in Europe doubled from about 8% to 16%, and it is still growing. We are nearing a tipping point, and in certain niches, we believe wind power has significant potential to disrupt the traditional energy market.
As a percentage of all incremental future electric capacity, wind power is taking a big leap forward from a small base. At the same time, its cost base has fallen, making wind power increasingly competitive with coal and gas in many markets, even on an unsubsidised basis. (In fact, it is directly competitive at generation, but loses some efficacy once the costs of backup and grid connections are factored in.)
Setting aside the recent drop in commodity prices, the costs of wind power are declining more rapidly and more sustainably than conventional power. In addition, clean air standards are driving widespread adoption, regardless of whether wind power costs a penny or two more.
Mark Bogar and Andrew Leger – The Boston Company Asset Management, a BNY Mellon company