25 Apr Renewable energy is gaining accelerated momentum
Renewable energy has witnessed accelerated growth, but there still is a long way to go to reach a clean energy future capable of averting the impacts associated with the climate challenge.
Our path towards powering our future will determine future emission scenarios and potentially create a foundation for a clean energy future. The next steps are critical to ensure we can keep global temperature rise below 2 degrees Celsius by the end of the century. The latest IPCC report emphasised that we require decisive and drastic emission reductions to achieve the goal of the 2015 Paris climate agreement. Shifting toward renewable energy for power generation will be critical in supporting progress. Heymi Bahar, the senior energy analyst at the International Energy Agency (IEA), believes the target is ambitious, requiring a quicker and expanded response to the climate challenge.
With advancements in technology and increased awareness about climate change, more and more people are turning to renewable energy sources like solar and wind power. Some experts predict that by 2050, renewable energy could provide up to 80% of the electricity needed in the US. There are positive signs that we are making this transition, including accelerated growth in renewable electricity generation, but there are still challenges to overcome, and the speed of transition must accelerate, according to many industry experts.
Worldwide, renewable energy makes up approximately one-third of electricity generation, and that figure is increasing. Last year, renewable generation capacity grew by a record 295 GW. IRENA reported that renewable energy accounted for over 805% of all added power capacity last year.
Renewable energy produced more electricity than coal-powered facilities in the US last year. Wind and solar energy now collectively provide 14% of the nation’s electricity, an increase from virtually zero just 25 years ago. The US Energy Information Administration believes that over half of the electric generation capacity added to the US grid this year will come from solar.
The key driving force for renewable energy growth in the last few years is a considerable decline in the costs of generating solar and wind power. The cost of solar PV cells has dropped by 90% over the last ten years, partly due to accelerated manufacturing. Government subsidies in the US have also helped renewable energy, as did policies supporting renewable energy adoption. For example, in selected states of the US, there are standards for how much electricity requirements should be fulfilled with renewable energy.
Despite the positive steps, the current rate of renewable energy adoption is still considerably lower than required to reach our climate goals. While global renewable energy capacity grew by 9.6% last year, IRENA believes the capacity growth rate needs to triple to reach our Paris climate goals and with other industries decarbonising, our electricity needs will only increase.
There are barriers to accelerating the adoption of renewable energy. Firstly, solar and wind represent intermittent power sources, requiring the added deployment of batteries or other forms of energy storage, which can inflate costs. Furthermore, PV cells and lithium-ion batteries are dominant energy storage options that require specific minerals for production. The demand for these resources could outpace supplies and potentially impact future production. Another factor to consider is that we’re not starting at the beginning, referring to the significant existing infrastructure we have invested in. Analysts from IRENA believe that 41% of planned energy investment by 2050 focuses on fossil fuels. Stricter government policies to reduce emissions will prove critical to driving renewable energy adoption.
Financing is another challenge. While the costs of renewable energy have declined, the industry requires investment, meaning financing cost and risk management is considered very important. Financing is a particular challenge in equally distributing renewables. The US, Europe, India and China collectively account for 80% of new renewable energy capacity. Approximately 85% of investments in renewable energy have benefitted only 50% of the global population and predominantly those in the largest economies. Multinational development banks, often a key funding source for projects in developing nations, must support these areas in adopting renewable energy projects by addressing the initial costs and the risk from political conditions in certain areas.
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