But still not quickly enough to offset the use of fossil fuels
GLOBAL ENERGY demand tumbled by 4% in 2020, as flights were grounded, factories idled and commuters locked down at home. One part of the world’s electricity markets, however, continued to grow. Renewable-energy generation grew at its fastest rate in two decades, according to a new report by the International Energy Agency (IEA), an intergovernmental forecaster.
New renewable-energy capacity grew by 45% last year, adding an extra 280GW to the world supply—more than the entire energy-generation capacity of Germany.
The surge was partly because of a sudden scramble to install additional renewable capacity in America, China and Vietnam before government subsidies expired. Because of such schemes, twice as much renewable-energy capacity was added in the fourth quarter of 2020 than in the last three months of 2019.
Most of these gains went to new wind and solar installations, though hydro-electric capacity also expanded markedly. China accounted for 80% of new solar and onshore wind installations, as developers rushed to meet a deadline requiring subsidised projects to be connected to the grid by the end of 2020.
The IEA expects similar growth in renewable-energy production in the next few years, predicting 270GW of new capacity this year and almost 280GW in 2022. These estimates have been revised up by more than 25% since November as governments in several countries have awarded contracts to build record amounts of renewable capacity. The market for corporate power-purchase agreements—long-term deals to supply electricity—also boomed in 2020. These trends were particularly evident in the European Union, as governments and companies faced pressure to meet the bloc’s climate targets for 2030. The momentum is expected to continue in the coming years, so long as there are sufficient supplies of the critical minerals needed for building wind turbines and other equipment—such as nickel, cobalt, lithium, copper and rare-earth metals.
Yet for all the growth of renewables last year, fossil fuels remain the world’s dominant source of energy, with production expected to rise in 2021. A report published in April, also by the IEA, predicted that energy-related carbon-dioxide emissions will increase by nearly 5% in 2021, as lockdowns lift and countries open up, all but reversing the reductions that occurred during the pandemic. Global demand for coal to produce electricity is expected to be close to its annual peak. The world is on course to use ever more energy. The current surge of renewables is some cause for hope, but only a modest one.
Source: The Economist