Electric vehicle (EV) sales crashed in Asia at the start of the year as the COVID-19 pandemic set in and the outlook for renewable energy this year is bleak.

EV sales dropped by 44 per cent in China compared to the year before, 18 per cent in South Korea, slightly more than 10 per cent in Japan and around 7 per cent in India, says a report by Bloomberg New Energy Finance (BNEF).

Battery demand could be as much as 9 gigawatt hours (GWh) lower in 2020.

EVs are particularly exposed to buyer risk because the supply chain is so new and they remain largely a premium consumer purchase, potentially pushing fledgling electric vehicle makers to the wall.


Solar will be punished

Solar projects are likely to suffer badly this year too and 2020 could be the first year since the 1980s where the solar sector contracts, BNEF says.

It has cut its global solar demand from a forecast 121-152 gigawatts (GW) made in February, by 16 per cent to 108-143GW.

It’s likely to be another record year for wind power installations, but there is “considerable downside risk” to the researcher’s 2020 installation expectations of 75.4GW

BNEF says wind power is an industry where delivery and build schedules are tight and specialised equipment is rented for a limited time.

In Australia, the big listed renewable energy companies are facing a different set of challenges.

Developer risk and delays has set Windlab’s (ASX:WND) Kennedy Energy Park back, although the company and the developer recently extended a truce on their contractual dispute.

Developers such as Downer Group are pulling out of the sector as a combination of large power loss factors, grid stability problems, connection problems, and equipment performance issues have made these jobs too risky.


China is back

It’s not all bad news, however.

BNEF says Chinese factories are restarting, so supply pressures on key components and equipment is likely to ease.

“Although there are short-term bottlenecks to delivery, we are currently more concerned about demand, as policy makers may divert attention away from clean energy to more pressing concerns,” the report said.


Cheap cheap LNG is going to hurt everyone

Consultant Wood Mackenzie says across Asia, low LNG prices will challenge both coal and renewables.

Australian LNG deliveries fell in January and February from 45 last year to 31. Shipments to China crashed to 29 in February, from 40 the month before.

China’s largest LNG importer CNOOC invoked force majeure in early February and PetroChina followed for some suppliers in early March.

Researchers from the Oxford Institute for Energy Studies says there’s growing concern that these notices are in fact an attempt to renegotiate contracts in light of the fall in oil prices.