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Major new report from RMI suggests surging solar, wind, and battery capacity is now in line with global net zero scenarios
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Clean energy deployment is exceeding expectations to such an extent that the global power system is rapidly moving into line with a net zero decarbonisation trajectory.
That is the headline conclusion of a major new analysis today from the RMI think tank, which details how surging solar, wind, and battery markets are now on track to be in line with ambitious net zero scenarios by 2030.
The report, which was backed by the Bezos Earth Fund, calculates that based on the near exponential increase in deployment rates for wind and solar technologies seen in recent years, the two main renewable generation technologies are on course to supply over a third of power globally by 2030, up from around 12 per cent currently. As such, fossil fuel demand from the global power system has likely already peaked and should be in “freefall” by the end of the decade.
The report comes just a day after the International Energy Agency (IEA) published a separate update detailing how clean energy technologies have continued to make “remarkable gains” over the past year, with electric vehicle (EV) sales increasing nearly 10-fold over the past five years to more than 10 million, annual renewables installations soaring to a record 340GW, and global clean energy investment climbing 15 per cent to a record $1.6tr.
Separately, a new report yesterday from Bloomberg Intelligence predicted global wind energy installations are set to jump more than 20 per cent this year to around 110GW and that double digit growth rates are set to be sustained through to 2026.
RMI’s analysis suggests that based on current trends the world is on track to deliver on the goal agreed at last year’s COP27 Climate Summit to treble global renewables capacity by 2030, with solar and wind generation set to increase up to four-fold compared to 2022 levels.
It calculates that under such a scenario fossil fuel demand for electricity “will be in steep decline” by 2030, down by as much as 30 per cent from a 2022 peak by the end of the decade.
The report stresses that the surge in renewables deployment is driven in large part by the cost advantages now enjoyed by wind and solar power in almost every major market globally, citing analysis from BloombergNEF that shows how solar and battery costs have declined 80 per cent between 2012 and 2022, while offshore wind costs are down 73 per cent, and onshore wind costs are down 57 per cent.
Renewables developers have been hit by higher material costs in recent years, but RMI insists the continued exponential growth of the sector is set to enable further cost savings as the decade proceeds. The report forecasts that solar power – which is already the cheapest form of electricity in history – will roughly halve in price again by 2030, falling as low as $20/MWh from over $40MWh currently.
“Exponential growth of clean energy is an unstoppable force that will put more spending power in the pockets of consumers,” said Kingsmill Bond, senior principal at RMI. “The benefit of rapid renewable deployment is greater energy security and independence, plus long-term energy price deflation because this is a manufactured technology – the more you install the cheaper it gets.”
The report also highlights how the clean energy revolution is rapidly extending beyond the three main markets of China, the EU, and US.
A separate analysis published today by Systems Change Lab explored renewables deployment in a variety of different markets – Uruguay, Denmark, Lithuania, Namibia, Netherlands, Palestine, Jordan, and Chile – and concluded that rapid increases in renewables capacity are achievable in a wide range of different economic and political contexts.
The report noted that globally wind and solar’s share of the power mix needs to increase by 29 per cent by 2030 to be in line with net zero goals – an increase already achieved over an eight-year period by Denmark, Uruguay, and Lithuania. Meanwhile, Namibia, the Netherlands, Palestine, Jordan, and Chile have all achieved the requisite annual deployment rate over a five-year period.
Andrew Steer, president and CEO of the Bezos Earth Fund, said it was clear the exponential roll out of clean technologies could benefit industrialised and developing economies alike. “The exponential growth trend in renewable electricity can be harnessed to help developing countries get ahead of the curve and transition faster to a cleaner and more affordable electricity system,” he said.
RMI’s projections are more optimistic than those from other analysts, but speaking to reporters yesterday Bond argued more conservative forecasts tended to be based on historic performance and failed to account for how renewables were moving onto an ‘S curve’ deployment model that has disrupted multiple sectors in the past. The report also highlights how plummeting renewables cost should help trigger similarly rapid deployment of green transport and industrial technologies.
“The ‘S curve’ pattern is actually very common for technologies,” he said, citing the example of mobile networks and information technologies in recent decades, as well as canals and railways in the 19th century. “What we are seeing is that change in the power sector is exponential, the conditions for that exponential change are still in place, and that means deployment will be fast and faster,” he said. “We are on track for net zero.”
However, Bond also acknowledged that potential barriers to deployment remained, such as planning and grid constraints and concerns over clean tech raw material supplies. He insisted such barriers were surmountable, but required action from businesses, investors, and governments to ensure they are addressed before they start to impact renewables deployment rates.
Christiana Figueres, former executive secretary at the UNFCCC and founding partner of Global Optimism, urged political and business leaders to now “seize the opportunity of accelerating the energy transition”.
“The call to triple renewable electricity investment and capacity by 2030 are deliverable,” she said. “But only by removing barriers to faster renewable deployment, from streamlining permitting to redirecting subsidies for polluting energy. Otherwise, the exponential growth we are seeing and the benefits that come with it could be derailed unnecessarily.”
It was a point reiterated by yesterday’s update from the IEA, which stressed that despite record levels of clean tech deployment last year urgent action was still needed to accelerate renewables and EV adoption outside of core markets and deliver cost competitive clean technologies for industry and long-distance transport.
“The clean energy economy is rapidly taking shape, but even faster progress is needed in most areas to meet international energy and climate goals,” said IEA executive director Fatih Birol. “This update of Tracking Clean Energy Progress highlights some very promising developments, underlining both the need and the potential for greater action globally. The extraordinary growth of key technologies like solar and electric cars shows what is possible.”