Lopsided Gains in Renewable Energy, IRENA Finds

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--The global economy set a new record in terms of renewable energy installments last year, though progress was centered in the world's richest countries, the International Renewable Energy Agency (IRENA) said.

Based in Abu Dhabi, IRENA said total capacity for renewables deployed in the power sector hit 3,870 gigawatts (GW) last year, a new record. Solar power was the clear standout, with 1,419 GW of additions, representing 74% of the total gains last year. Wind energy was a distant second with 25% of the expansion in renewables.

China is leading the world in renewable energy installations. Restrictions on real estate lending, coupled with pandemic-era stimulus, drove considerable investments toward clean energy resources over the last few years.

But despite the progress, China still relies heavily on fossil fuels for electricity and most of that is in the form of coal.

In the United States, meanwhile, the federal government expects to see 36 GW of new solar capacity on the grid this year and another 35 GW in 2025. In terms of the share, the government expects solar power generation to account for 7% of what's on the grid next year, up from 4% in 2023.

"The increase in generation from renewable sources, particularly solar, is likely to reduce generation from fossil fuel sources," a report from the U.S. Energy Information Administration (EIA) read.

Elsewhere, IRENA reported that wind energy capacity increased by 13% last year, taking second fiddle to solar power. By the end of last year, total wind energy capacity reached 1,017 GW, and again it was China and the United States in the lead.

Wind energy is evolving, but the U.S. is lagging behind its peers in terms of offshore installations. The government so far this year, however, has opened up its territorial waters to bidders looking to establish offshore wind farms.

Federal incentives in both major economies are supporting the expansion in renewable energy.

"This extraordinary surge in renewable generation capacity shows that renewables are the only technology available to rapidly scale up the energy transition aligned with the goals of the Paris Agreement," said IRENA Director-General Francesco La Camera.

But progress is lopsided, IRENA found. The Asian economies alone accounted for around 69% of total renewable expansions last year, while Africa saw an increase of only 4.6%.

This highlights the disparity in the global energy transition, undermining collective decarbonization goals.

"Policy interventions and a global course-correction are urgently needed to effectively overcome structural barriers and create local value in emerging market and developing economies, many of which are still left behind in this progress," La Camera said.

A separate report, meanwhile, suggests that major oil companies are not meeting investor expectations on climate initiatives. The group Climate Action 100+ said companies such as Exxon Mobil Corporation (NYSE:XOM) (Spring, Texas) and TotalEnergies SE (NYSE:TTE) (Paris, France) have net-zero targets, but the pathway is anything but clear.

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