Global investment in renewables is rising

The International Renewable Energy Agency (IRENA) held its seventh Assembly yesterday, gathering together 75 ministers from over 150 countries to advance the global renewable energy agenda and make concrete steps to accelerate the global energy transformation.

The Assembly saw the release of the agency’s flagship report, ‘REthinking Energy 2017’, now in its third edition. The publication highlights how global investment in renewables has steadily grown for more than a decade, rising from less than US$50 billion in 2004 to US$305 billion in 2015.

“Renewables are gaining ground by nearly every measure,” said IRENA Director-General Adnan Z Amin, noting that falling costs are spurring renewable energy deployment and, with it, several socioeconomic benefits.

Amin noted that policies and regulations remain crucial to the decarbonisation of the energy sector and the development of the renewables market. He said, “We are seeing more and more countries hold auctions to deploy renewables, and as variable and distributed sources of renewables take on a greater role, regulators have implemented changes to enable grid integration at scale. Heating and cooling, and the potential of renewables for transport, are areas where future efforts are needed.”

REthinking Energy 2017 provides insights on the innovations, policy and finance driving further investment in sustainable energy system. Such insights include:

• Renewable energy auctions are gaining popularity in developed and developing countries, generating record-breaking low energy prices.
• Demand for battery storage is increasing rapidly and playing a larger part in integrating variable renewables.
• New capital-market instruments are helping increase available finance by offering new groups of investors access to investment opportunities.
• Institutional investors are moving into renewable energy as it offers stable returns over the long term.
• New business models promise new ways to finance renewable energy.

The publication says solar PV will grow the fastest in terms of capacity and output, and new ways to store electricity will be a game changer for growing variable renewable energy generation. IRENA estimates that battery storage for electricity could increase from less than 1 GW today to 250 GW by 2030.

The report also states that off-grid renewables currently provide electricity to an estimated 90 million people and can potentially provide modern energy access to hundreds of millions more. This is because they are cost-effective and can be installed in modular fashion, linked to grid extension plans.

“Achieving universal electricity access by 2030 will require us to boost global power generation — nearly 60% of that will have to come from standalone and mini-grid solutions,” said Amin. “Meeting this aim with off-grid renewables depends on the right combination of policies, financing, technology and institutional capacity.”

Amin concluded that accelerating the deployment of renewable energy will “allow countries to address global issues in sustainability, education, gender equality, health, water and food”.

“Accelerating the pace of the energy transition and expanding its scope beyond the power sector will not only reduce carbon emissions, it will improve lives, create jobs, achieve development goals and ensure a cleaner and more prosperous future,” he said.

REthinking Energy 2017 can be downloaded here.