The 826GW of new non-hydro renewable power planned worldwide by 2030 falls far short of what is needed to meet the Paris agreement, according to a new report.
Global Trends in Renewable Energy Investment 2020, produced by the UN Environment Programme (UNEP), the Frankfurt School-UNEP Collaborating Centre and Bloomberg New Energy Finance (BNEF), analyses 2019 investment trends, and clean energy commitments made by countries and corporations for the next decade.
The report found that planned non-hydro renewables investments “fall far below” the $2.7tn (€2.3tn) committed to renewables during the last decade.
BNEF chief executive John Moore said: “Clean energy finds itself at a crossroads in 2020.
“The last decade produced huge progress, but official targets for 2030 are far short of what is required to address climate change.
“When the current crisis eases, governments will need to strengthen their ambitions not just on renewable power, but also on the decarbonisation of transport, buildings and industry.”
Renewable energy is now so cost-effective it can provide an opportunity to prioritise clean energy in economic recovery packages and help meet the goals of the Paris Agreement, the report found.
The authors have totalled commitments equivalent to 826GW of new non-hydro renewable power capacity, at a likely cost of around $1tn by 2030.
They point out that this falls “far short” of capacity and investment needed for the world to get on track to limit global temperature rise to under two degrees Celsius.
To achieve the main goal of the Paris Agreement would require the addition of around 3000GW by 2030, the exact amount depending on the technology mix chosen, said the report.
The report shows the cost of installing renewable energy has hit new lows, meaning future investments will deliver far more capacity.
Renewable energy capacity, excluding large hydroelectric dams of more than 50MW, grew by 184GW in 2019.
This highest-ever annual addition was 20GW, or 12%, more than the new capacity commissioned in 2018, while the dollar investment in 2019 was 1% higher than the previous year, at $282.2bn.
The all-in, or levelised, cost of electricity continues to fall for wind and solar, thanks to technology improvements, economies of scale and fierce competition in auctions, the report highlighted.
Costs for electricity from new solar PV plants in the second half of 2019 were 83% lower than a decade earlier.
UNEP executive director Inger Andersen said: “The chorus of voices calling on governments to use their COVID-19 recovery packages to create sustainable economies is growing.
“This research shows that renewable energy is one of the smartest, most cost-effective investments they can make in these packages.
“If governments take advantage of the ever-falling price tag of renewables to put clean energy at the heart of COVID-19 economic recovery, they can take a big step towards a healthy natural world, which is the best insurance policy against global pandemics.”
Nearly 78% of the net new gigawatts of generating capacity added globally in 2019 was in wind, solar, biomass and waste, geothermal and small hydro.
Investment in renewables, excluding large hydro, was more than three times that in new fossil fuel plants.
The report found 2019 annual solar power capacity additions hit their peak, totalling 118GW and that last year saw the highest investment in offshore wind in one year, at $29.9bn, up 19% year-on-year.
Last year also recorded the highest volume of renewable energy corporate power purchase agreements, at 19.5GW worldwide.
The highest renewables investment ever in developing economies other than China and India, at $59.5bn, also occurred in 2019.
Frankfurt School of Finance & Management president Nils Stieglitz said: “We see the energy transition is in full swing, with the highest capacity of renewables financed ever.
“The climate and Covid-19 crises – despite their different natures – are both disruptions that command attention from policy makers and managers alike. Both crises demonstrate the need to increase climate ambition and shift the world’s energy supply towards renewables.”