Recently, the International Energy Agency released its 2023 Renewable Energy Annual Market Report, which shows that the global renewable energy installed capacity in 2023 has increased by 50% compared to 2022, and the growth rate of installed capacity is faster than at any time in the past 30 years. The report predicts that the global installed capacity of renewable energy will enter a period of rapid growth in the next five years, but key issues such as financing for emerging and developing economies still need to be addressed.
Renewable energy will become the main source of electricity by early 2025
This report is the first comprehensive assessment of global renewable energy development trends by the International Energy Agency since the closing of the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP28). The report shows that the new installed capacity of renewable energy worldwide reached 510 gigawatts in 2023. The International Energy Agency predicts that under existing policy and market conditions, the global installed capacity of renewable energy is expected to reach 7300 gigawatts between 2023 and 2028. By early 2025, renewable energy will become the world’s primary source of electricity.
The report predicts that wind and solar power generation will account for 95% of the new renewable energy generation in the next five years. By 2024, the total amount of wind and solar power generation will exceed that of hydroelectric power generation; Wind and solar power generation will surpass nuclear power in 2025 and 2026, respectively. By 2028, the share of wind and solar power generation will double, reaching a total of 25%.
Global biofuels are also entering a golden period of development. In 2023, biofuels will gradually be promoted in the aviation industry and will begin to replace more highly polluting fuels. Taking Brazil as an example, the growth rate of biofuel production capacity in 2023 is 30% faster than the average level of the past five years.
The International Energy Agency believes that governments around the world are increasingly focusing on providing affordable, safe, and low emission energy supplies, and stronger policy guarantees are the main driving force for achieving milestone development in the renewable energy industry.
More policy and financing support are still needed to achieve growth goals
“Although the world is moving towards the goal set by COP28, which is to triple the global installed capacity of renewable energy by 2030, under current policy and market conditions, the growth rate of renewable energy is not yet sufficient to achieve this goal,” said Fatih Birol, Director of the International Energy Agency.
The International Energy Agency report believes that the global development of renewable energy is uneven, especially the slow development of hydrogen and bioenergy. Taking hydrogen energy as an example, although many green hydrogen energy projects have been launched in the past 10 years, due to slow investment progress and high production costs, it is expected that only 7% of the planned production capacity can be actually put into operation by 2030.
The International Energy Agency also pointed out that before 2030, the biofuel industry also needs to accelerate its development speed in order to achieve a global energy industry net zero emission schedule. In addition, due to global supply chain tension, rising costs, and longer project licensing cycles, the global wind power industry also faces many challenges and requires more policy support from countries.
In the process of developing renewable energy, different economies also face different problems and challenges. The report believes that for developed economies, policy uncertainty, insufficient investment in grid infrastructure, and cumbersome administrative approval procedures are the main challenges in developing renewable energy. For most emerging and developing economies, the focus is on addressing financing, governance, and regulation of the renewable energy industry.
“Currently, in most countries around the world, onshore wind and solar power generation has cost advantages compared to fossil fuel power generation. The biggest challenge in achieving these goals is how to rapidly expand financing and deployment of renewable energy in most emerging and developing economies.” Birol said that the International Energy Agency will closely monitor whether countries will fulfill their commitments and implement appropriate policies.
China is a leader in the field of renewable energy
The International Energy Agency stated in its report that China is a leader in the global renewable energy sector. In 2023, the new installed capacity of wind energy in China increased by 66% compared to the previous year. The new installed capacity of solar photovoltaic in China in 2023 is equivalent to the global new installed capacity of solar photovoltaic in 2022. It is expected that by 2028, China will account for 60% of the world’s new renewable energy generation, and China plays a crucial role in achieving the global goal of doubling renewable energy.
In recent years, China’s photovoltaic industry has developed rapidly and maintained international leadership. Currently, nearly 90% of the global photovoltaic industry’s production capacity is located in China; Among the top ten global companies in photovoltaic modules, 7 are Chinese companies. While reducing costs and increasing efficiency, Chinese enterprises are also increasing their research and development efforts to tackle the new generation of photovoltaic cell technology.
China’s wind power equipment exports are also showing a rapid growth trend. According to relevant statistics, about 60% of wind power equipment on the global market is currently produced in China. Since 2015, the compound annual growth rate of China’s wind power equipment export installed capacity has exceeded 50%. The first wind power project undertaken by a Chinese enterprise in the United Arab Emirates has recently been officially put into operation, with a total installed capacity of 117.5 megawatts; The first centralized wind power project in Bangladesh, invested and constructed by a Chinese enterprise, was recently connected to the grid for power generation. It can provide 145 million kilowatt hours of green electricity to the local area every year… While achieving its own green development, China also provides support for more countries to develop renewable energy, helping to achieve global climate goals.
Abdulaziz Obadeli, Chief Operating Officer of Abu Dhabi Future Energy Company in the United Arab Emirates, stated that the company has close cooperation with multiple Chinese companies, and many projects are supported by Chinese technology. China has made significant contributions to the development of the global new energy industry and addressing climate change. Ahmad Mohammad Masina, Deputy Minister of Electricity and Renewable Energy of Egypt, said that China’s contribution in this field is of great significance for global energy transformation and climate governance.
The International Energy Agency believes that China has technological, cost advantages, and a long-term stable policy environment in the field of renewable energy, and has played an important role in promoting the global energy revolution, especially in reducing the cost of global solar power generation.
