"1. Energy Efficiency. It has been frequently said that the cheapest source of energy is the energy never used. There are enormous opportunities for improving the efficiency of the world’s energy infrastructure, both on the supply side and the demand side – and many of them could even produce returns above the cost of capital of major businesses. In a recent report, the McKinsey Global Institute estimated that there are US$ 170 billion of energy efficient investment opportunities that would produce an IRR of 17% or more.
2. Smart Grid. The world’s electricity grids were designed to distribute power cheaply and reliably from large, centralized, predictable power stations. The grid
of the future will have to cope with decentralized, fluctuating supply. It will also be expected to deliver a far more sophisticated range of services to help with
demand-side energy management. Only a new and fully digitally-enabled grid architecture will be able to meet these needs, and the investment requirement is
estimated by New Energy Finance at US$ 8.6 trillion (including US$ 6.8 trillion to repair and replace the existing transmission and distribution network).
3. Energy Storage. The need for energy storage is increasing – whether to power hybrid electric vehicles, to smooth out fluctuations in supply and demand, or to
extend appliance functionality. The cost of storing 1MWh of electricity ranges from US$ 50 to US$ 180, depending on the technology used. As power storage prices come down, it can increasingly be used to smooth the supply of power or to bridge the gap
between peak and night-time electricity rates.
Improved power storage is also required by ever more advanced mobile appliances and ubiquitous communications.
4.Carbon Capture and Sequestration. No discussion of the future energy infrastructure can be complete without considering Carbon Capture and Storage
(CCS). Although there are no installations at scale yet, there are almost 200 projects at varying degrees of completion around the globe. With so many countries
– including China and the US – overwhelmingly dependent on coal for their electricity, CCS needs to form part of the solution if we are to restrict CO2e
concentrations to 450ppm."
Source: Green Investing - Towards a Clean Energy Infrastructure
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