Friday, 25 October 2024.
At COP28 last December 2023 in Dubai, governments agreed to work together to triple the world’s installed renewable energy capacity by 2030.
Newest report “Renewables 2024” by the International Energy Agency (IEA) forecasts that global renewable capacity is expected to grow by 2.7 times by 2030, surpassing countries’ current ambitions by nearly 25%.
In other words, nearly 70 countries that collectively account for 80% of global renewable power capacity are poised to reach or surpass their current renewable ambitions for 2030. China drastically dominates among these overachievers, but other major economies, such as Brazil, India and the United States, also contribute.
The 3x target would not be reached but it would represent a significant and relatively rapid shift in the global energy landscape.
According to EIA, 2030 forecast has two main drivers:
- China consolidating its position as the global renewables leader, accounting for 60% of the expansion in global capacity to 2030, followed by European Union, United States and India; and
- Solar capacity growing rapidly, responsible for 80% of the growth in renewable energy worldwide by 2030, in parallel with the recovery of the wind sector.
IEA highlights, though, a significant global point of attention: grid infrastructure and system integration of renewables.
Regarding solar and wind, despite growing investment in battery storage in many markets like we reported recently, further flexibility measures will be necessary such as including long-term storage and large-scale demand-response. As a reference, by 2030, solar and wind penetration is set to reach close to 70% in countries such as Chile, Germany, the Netherlands and Portugal.
About renewables fuels, demand is poised to expand in all regions, but remaining concentrated in Brazil, China, Europe, India and the United States.
Yet, hydrogen remains a minor source for new renewable capacity, mainly due to insufficient demand. The IEA predicts that hydrogen will represent just 4% of total renewable energy production in 2030, with the most important current stimulus policies being in Europe, the United States and China.
Click at the image below to read the 177-pages report. The report features a special chapter on renewable fuels, including bioenergy, biogases, hydrogen, and e-fuels. Do not miss it.
As you will read, along the report there are discussions of pricing trends for these several energy sources. According to the IEA, despite the projected abundance of fossil fuels, the demand for coal, oil and gas - and related emissions - will probably peak before 2030. This emissions peak was recently suggested by the Norwegians at DNV as occurring in 2024. Could it be?
Anyway, all these could lead to a different energy landscape than we have witnessed in recent years, with less pressure on energy prices and more conditions for countries and politicians to focus on the good energy transition.
All in all, like an “earthquake” towards renewable energies and with significant geopolitical implications.
Lastly, considering that by early 2025 there is the next round of submissions of the Nationally Determined Contributions (NDCs) by the countries, one should expect positive surprises in terms of enhanced ambitions towards renewables.
