A new report has emerged stating that around 90% of the capacity added to the global grid in 2020 came from renewables, as the proliferation of solar, wind and hydroelectric power continues to accelerate around the globe.
The data comes from the International Energy Agency, who published its Renewables 2020 report stating that 90% of the capacity added to the global grid came in the form of renewables.
The IEA says that the significant growth of renewable energy being added to the grid was the result of China and the United States adding around 200-gigawatts of renewable power to their electricity grids, as well as growing recognition of the cost advantages of building renewable power, rather than traditional coal-fired power plants.
The IEA expects that solar and wind will continue to roll out exponentially – up to 30% – as operators use a range of government incentives to fund the construction of new renewable power generation and storage infrastructure.
The European Union is expected to expand its fleet of renewable power generation facilities by around 10%, which would be the most significant increase in more than five years; India is expected to add around 10% to its national fleet of renewables.
The fact that 90% of the capacity added to the global grid in 2020 coming from renewables has given the IEA confidence to anticipate that by 2025, renewable energy will be the largest power source across the world.
The IEA was quick to note that share prices for companies involved in the renewables sector have been outperforming their traditional fossil fuel-based counterparts, with stocks in developers and equipment manufacturers performing particularly well in 2020 in spite of the pandemic-inspired recession.
The IEA also expects that wind and solar power generation is well on its way to replacing natural gas as a means of power generation by 2023, with coal next in line to be replaced by 2024. “Solar PV alone accounts for 60% of all renewable energy capacity additions through 2025, and wind provides another 30%,” the report states. “The rapid growth of variable renewables around the world calls for increased policy attention to ensure they are securely and cost-effectively integrated into electricity systems,” the authors say.
Executive Director of the International Energy Agency, Fatih Birol writes in the report that “renewable power is defying difficulties caused by the pandemic, showing robust growth while others fuels struggle.”
Birol said that he is confident in the IEA’s estimate that by 2025, renewables will make up the largest portion of the energy mix, stating that “by that time, renewables are expected to supply one-third of the world’s electricity – and their total capacity will be twice the size of the entire power capacity of China today.”
In reference to the resilience of the renewables sector in the wake of a pandemic, Birol said that “the resilience and positive prospects of the sector are clearly reflected by continued strong appetite from investors – and the future looks even brighter with new capacity additions on course to set fresh records this year and next.”
According to a report from TechCrunch, “most of this success will require continued political support to work. Expiring incentives could reduce demand, but if governments provide some certainty around the continuation of subsidy programs, solar and wind additions could jump by another 25% by 2022. With the right policy, solar photovoltaic installations could reach a record 150-gigawatts by 222, which would be a 40% increase in just about three years.”
The IEA’s chief, Dr Birol says that “renewables are resilient to the COVID crisis but not to policy uncertainties.”
“Governments can tackle these issues to help bring about a sustainable recovery and accelerate clean energy transitions. In the United States, for instance, if the proposed clean electricity policies of the next US administration are implemented, they could lead to a much more rapid deployment of solar PV and wind, contributing to a faster decarbonisation of the power sector.”