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IEA forecasts another record year for renewables growth worldwide
Growth of world capacity to generate electricity from renewable technologies is to accelerate over coming years, with 2021 expected to set an all-time record for new installations. Despite rising costs, new renewable power capacity this year is forecast to rise to 290 GW in 2021 – an ‘all-time high’ according to the International Energy Agency’s (IEA) latest Renewables Market Report.
Looking ahead, by 2026 global renewable electricity capacity is forecast to increase over 60% from 2020 levels to over 4,800 GW – equivalent to the total global power capacity of fossil fuels and nuclear power combined. Indeed, renewables are forecast to account for almost 95% of the increase in global power capacity through to 2026, with solar power accounting for more than half of that.
The rise is driven by stronger support from government policies and more ambitious clean energy goals announced before and during the COP26 climate change conference in Glasgow last month.
IEA Executive Director Fatih Birol is convinced that ‘a new global energy economy is emerging’. However, he is concerned that: ‘The high commodity and energy prices we are seeing today pose new challenges for the renewable industry, but elevated fossil fuel prices also make renewables even more competitive.’
China remains the global leader in terms of renewable capacity additions and is expected to reach 1,200 GW of total wind and solar capacity in 2026. This is driven by developers rushing to complete projects before subsidies expired. India is set to double new installations compared with 2015–2020, with a newly-announced government goal of reaching 500 GW of renewable power by 2030.
Meanwhile, deployments in Europe being finalised under the ‘Fit for 55’ programme, and the US, are also on track to speed up significantly from the previous five years. Together, these four markets account for 80% of renewable capacity expansion worldwide, says the IEA.
Solar PV (photovoltaics) capacity additions are forecast to increase by 17% in 2021 to 160 GW. Onshore wind additions are set to be 25% higher on average than during 2015–2020. Total offshore wind capacity is expected to more than triple by 2026.
Global biofuel demand in 2021 is forecast to surpass 2019 levels, rebounding from last year’s huge decline caused by the pandemic. Biofuel demand is expected to grow strongly to 2026, with Asia accounting for about 30% of new demand.
However, Birol emphasises that this faster renewables deployment ‘will still fall well short of what would be needed in a global pathway to net zero emissions by 2050’, in accordance with the IEA’s scenario projections. To hit the net zero by 2050 goal, Birol claims renewable power capacity additions over the period 2021–2026 would on average almost have to double the rate of the report’s main case. Growth in biofuels demand would also have to be four times higher than in the main case, and renewable heat demand be almost three times higher.
‘A new global energy economy is merging,’ says Fatih Birol, IEA Executive Director