PUBLISHER: GlobalData | PRODUCT CODE: 1295458
PUBLISHER: GlobalData | PRODUCT CODE: 1295458
North America's energy transition is gaining pace. The decreasing cost of renewable energy is driving the decline of thermal power in North America, with forecasts predicting that renewable energy will account for 65% of power capacity in 2035. Meanwhile increasing support from government policies and tax credits will facilitate the further growth of electric vehicles as well as less developed technologies such as low-carbon hydrogen and carbon capture.
The energy transition in North America is gaining steam due to both the global momentum behind the sector and the Biden administration's support. Recent laws such as the Infrastructure Investment and Jobs Act, Inflation Reduction Act, and other initiatives are beginning to funnel billions of dollars into the sector and reduce the green premium on emerging technologies like green hydrogen and carbon capture. Thermal power's presence within North America's power mix will continue to decrease to 32% of power generation in 2035. In comparison, a strong build out will see renewables hold 65% of power capacity in 2035. As a result, emission free energy (including large hydropower) will account for 56% of the region's power generation in the same year. A combination of government policies, tax credits, higher gasoline prices, and growing environmental consciousness among consumers will increase the demand for electric vehicles within the North America market. As a result, electric vehicles will exceed 75% of the light vehicle market in Canada and the US. The US will also remain a global leader in ethanol production, boosting North America's renewable fuel production to 10,700 mmgy by 2030. North America is one of the world's most active regions for carbon capture, accounting for 63% of global capacity in 2021. 156 projects of varying size are in the pipeline to commence operations by 2030. North America has also seen plenty of activity in the low-carbon hydrogen space, including the announcement of the world's two largest projects in eastern Canada by Green Hydrogen International. In addition, North America is one of the most attractive regions for blue hydrogen due to abundant natural gas and favorable conditions for geological CO2 storage.