• Friday, April 19, 2024
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Policies, fossil prices, energy security drive global renewable capacity – IEA

Cross River holds energy summit to boost revenue, create jobs

Global renewable power capacity is expected to soar by 107 gigawatts (GW), the largest absolute increase ever, to more than 440 GW in 2023, due to growing policy momentum, higher fossil fuel prices, and energy security concerns, says a report by the International Energy Agency (IEA).

The energy agency says renewable power is on course to shatter more records as countries around the world speed up deployment. With the global energy crisis as a catalyst, solar photovoltaic (PV) and wind are set to lead the largest annual increase in new renewable capacity ever.

The IEA added that the growth is set to continue next year, with the world’s total renewable electricity capacity rising to 4,500 GW, equal to the total power output of China and the United States combined.

“The dynamic expansion is taking place across the world’s major markets. Renewables are at the forefront of Europe’s response to the energy crisis, accelerating their growth there,” the energy agency said.

According to the IEA, new policy measures are also helping drive significant increases in the United States and India over the next two years. China, meanwhile, is consolidating its leading position and is set to account for almost 55 percent of global additions to renewable power capacity in both 2023 and 2024.

“Solar and wind are leading the rapid expansion of the new global energy economy. This year, the world is set to add a record-breaking amount of renewables to electricity systems—more than the total power capacity of Germany and Spain combined,” said Fatih Birol, executive director of the IEA.

“The global energy crisis has shown renewables are critical for making energy supplies not just cleaner but also more secure and affordable, and governments are responding with efforts to deploy them faster.”

But achieving stronger growth means addressing some key challenges, Birol said. Policies need to adapt to changing market conditions, and we need to upgrade and expand power grids to ensure we can take full advantage of solar and wind’s huge potential.

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“Solar PV additions will account for two-thirds of this year’s increase in renewable power capacity and are expected to keep growing in 2024, according to the new report,” the IEA said.

“The expansion of large-scale solar PV plants is being accompanied by the growth of smaller systems. Higher electricity prices are stimulating faster growth of rooftop solar PV, which is empowering consumers to slash their energy bills.”

The energy agency added that at the same time, manufacturing capacity for all solar PV production segments is expected to more than double to 1,000 GW by 2024, led by China and increasing supply diversification in the United States, India, and Europe.

Based on those trends, the world will have enough solar PV manufacturing capacity in 2030 to comfortably meet the level of annual demand envisaged in the IEA’s Net Zero Emissions by 2050 Scenario.

“Wind power additions are forecast to rebound sharply in 2023, growing by almost 70 percent year-on-year after a difficult couple of years in which growth was sluggish,” the IEA said.

“The faster growth is mainly due to the completion of projects that had been delayed by COVID-19 restrictions in China and by supply chain issues in Europe and the United States.”

However, further growth in 2024 will depend on whether governments can provide greater policy support to address permitting and auction design challenges, the IEA said.

In contrast to solar PV, the IEA said wind turbine supply chains are not growing fast enough to match accelerating demand over the medium term. This is mainly due to rising commodity prices and supply chain challenges, which are reducing the profitability of manufacturers.

“The forecast for renewable capacity additions in Europe has been revised upwards by 40 percent from before Russia’s invasion of Ukraine, which led many countries to boost solar and wind uptake to reduce their reliance on Russian natural gas,” the energy agency said.

“The growth is driven by high electricity prices that have made small-scale rooftop solar PV systems more financially attractive and by increased policy support in key European markets, especially in Germany, Italy, and the Netherlands.”

While the competitiveness of wind and solar PV has improved since last year, government policies need to adapt to changing market conditions, particularly for renewable energy auctions, which were undersubscribed by a record 16 percent in 2022.