Renewable power generation is expected to continue its rapid growth over the next five years, according to a new report from the International Energy Agency (IEA). The report says that despite economic uncertainties in many countries, global power generation from hydropower, solar, wind and other renewable sources is increase by more than 40% to almost 6 400 terawatt hours (TWh) or roughly one-and-a-half times current electricity current production in the United States.
This growth is underpinned by the maturing of a portfolio of renewable technologies, in large part due to supportive policy and market frameworks in Organization for Economic Co-operation and Development (OECD) countries. However, rapidly increasing electricity demand and energy security needs in recent years have been spurring deployment in many emerging markets both large and small. These new deployment opportunities are creating a virtuous cycle of improved global competition and cost reductions.
"Renewable energy is expanding rapidly as technologies mature, with deployment transition from support-driven markets to new and potentially more competitive segments in many countries", IEA Executive Director Maria van der Hoeven said. The report's release comes amid profound changes and the uncertainties associated with a cautious macroeconomic outlook.
First, governments in several key markets are deliberating significant changes to renewable policies and deeper electricity market reforms renewable deployment scales up.
Second, the cost and availability of financing will act as a key variable, with a need for more investment sources and structures.
Finally, some parts of the renewable industry are going through a period of dramatic upheaval, with supply chains restructuring and shifting geographically while delivering cost reductions. Ultimately, such a consolidation should lead to a more mature and robust renewable sector.
Onshore wind, bioenergy and solar PV see the largest increases, respectively, in generation after hydropower. Offshore wind and CSP grow quickly from low bases. Geothermal continues to develop in areas with good resources. Ocean technologies take important steps towards commercialization.
Source: IEA, Jul 05