Renewable energy accounted for almost half of the world’s new power generation capacity in 2014, according to the International Energy Agency’s latest World Energy Outlook.
Renewables are now the second largest source of electricity after coal, the IEA said.
It forecasts that 60 cents of every dollar invested in new power plants towards 2040 will be spent on renewable energy technologies, which will result in global renewables-based electricity generation increasing by 8300TWh.
The net result is that coal’s share in the global electricity mix drops to 30% from 41%, with non-hydro renewables gaining a similar amount. Gas, nuclear and hydro will maintain their existing shares.
By 2040, renewables-based generation reaches 50% in the EU, about 30% in China and Japan and more than 25% in the USA and India.
The IEA said that despite both more costly technologies and rising fossil-fuel prices, electricity is set to become more affordable, relative to GDP, in most regions.
But to realise these projections, IEA said, the world needs to add more capacity by 2040 than is globally installed today, while average utilisation rates for capacity go down because of the need to integrate variable renewable technologies.
“This raises questions in many countries about the appropriate market mechanisms that can generate the necessary investment in generation and grids,” IEA said.
European Wind Energy Association chief executive officer Giles Dickson said: “The IEA’s World Energy Outlook shows that the transformation of the world’s power systems is unfolding before our eyes.
“Renewables accounted for half of all new power generation capacity installed globally last year. This is an incredible shift and shows how far the renewable and wind energy industry has advanced in recent years.
“But governments have to put in place the right policies to support investments in wind and other renewables.
“Above all they need to provide clear and stable regulatory frameworks and market conditions that send the right signals to investors.
“The ambitious commitments on renewables that emerging economies have made ahead the Paris climate summit offer real hope here – and show that countries are recognising that wind makes economic sense.”
Good Energy chief executive Juliet Davenport said: “This is a hugely encouraging report which shows the success of renewable energy globally.
“We must encourage the UK government to keep pace with the transition and not turn its back on the path to decarbonisation.”
Image: Morgue File
