Yergin: 'Renewable energy … becoming a big business'

"Around the world renewable energy is going through a rebirth. It is becoming a big business. It is also becoming a more established part of the world's overall energy supply. Last year, $120 billion was spent to install renewable electricity generation worldwide. Yet it is still a relatively small business compared to the overall energy business, and one that still faces big challenges in getting to scale on a global basis."

That's Daniel Yergin, international energy and oil markets expert and author of the new bestseller "The Quest: Energy, Security, and the Remaking of the Modern World" and the Pulitzer-Prize-winning book "The Prize," writing in an opinion column for CNN.com.

While public attention is focused on short-term matters such as the federal loan guarantee program and trade disputes between the U.S. and China on solar panel subsidies, Yergin says, the larger picture is that renewable energy sources like wind power are growing rapidly around the world today.  He sees the rise of climate change as an energy-related issue and the rapidly growing energy needs of developing countries as central factors in that growth: "As a senior official in Beijing told me, China used to regard the fierce winds in its northwest as a 'natural disaster,' but now they are prized as a 'very precious resource.'"

The renewable energy industries still have some major hurdles to overcome, Yergin says, with one of the most important ones being the growing competition from shale gas.  At the same time, he stresses, wind and solar energy are unlikely to repeat the "valley of death" experience of the 1980s and 1990s, when a global oil glut and falling energy prices drove many renewable energy companies into bankruptcy.  While there will be ups and downs in the future, renewable energy is destined for further growth.

More reading:

Yergin's 'The Quest': Wind power 'will certainly grow', October 4, 2011