Global economic growth has dropped this year because of COVID-19 and the energy sector has been among the hardest-hit, with oil prices at one point turning negative as demand slumped.
However, one part of the energy industry has defied the downturn – and is set to post record growth this year and next. Cost reductions and sustained policy support are set to drive strong growth in renewable energy. By 2025, renewables will have usurped coal to become the biggest source of electricity generation globally. To learn more, read “Renewable Electricity Set To Power Past Coal and Gas By 2025.” Reading this article may require a subscription.
- The International Energy Agency (IEA) Renewables 2020 report says that almost 200GW of new clean power capacity will be installed in 2020, almost 90 percent of all new power capacity around the world.
- Renewable electricity generation will increase by 7 percent globally in 2020, underpinned by the record new capacity additions, the Agency says. This growth comes despite a 5 percent annual drop in global energy demand, the largest since World War II.
- India’s renewable energy sector is set to double in 2021.
- Global growth in renewable capacity in the first 10 months of 2020 is already 15 percent higher than the same period last year, despite the pandemic, and growth is set to continue.
- But while renewables in the power sector are going from strength to strength, the COVID crisis has hit electric vehicles and renewable heat hard
Path to 100% Perspective:
As wind and solar power become increasingly cost-competitive, investments in traditional, inflexible base load plants such as large coal, nuclear, and gas combined-cycle plants are declining. This signals an end to the era of large, centralized power plants that run on fossil fuels.
Global financial trends reflect this dramatic shift, with renewable generation attracting more investment dollars than fossil-powered generation year after year. In 2018, investment in renewable power capacity was about three times higher than the amount invested in new coal- and gas-fired generation combined, according to the global renewable energy organization REN21. Worldwide investment in renewables has exceeded $230 billion for nine years in a row.
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