A new International Energy Agency forecast this morning projects that worldwide renewable energy capacity will grow by another 43 percent over the next five years amid surging solar increases in China and other factors.
Why it matters: The worldwide growth of solar and wind power is one of the various reasons why global carbon dioxide emissions have leveled off in recent years. Going forward, expansion of zero-carbon energy is key to efforts to avoid the most dangerous levels of global warming.
IEA, Renewables 2017: Analysis and Forecasts 2022; Chart: Andrew Witherspoon / Axios
Crystal ball: In its newly released five-year forecast, the IEA predicts over 920 gigawatts of capacity growth, signalling a somewhat more aggressive forecast than last year's study, largely on the strength of upward revisions to forecasts for China and India.
The chart above shows the major technologies fueling the growth, with wind and solar together represent over 80 percent of the projected growth.
- "China alone is responsible for 40% of global renewable capacity growth, which is largely driven by concerns about air pollution and capacity targets that were outlined in the country's 13th five-year plan to 2020," IEA said.
One big question: Whether IEA, while projecting growth, is too timid in its outlook. As Bloomberg New Energy Finance founder Michael Liebreich pointed out in a recent presentation, actual renewables growth has for many years outpaced IEA's annual forecasts (check out pages 54-74 of this document).
A few other takeaways from the IEA report, which takes stock of 2016 as well as forecasting the next five years:
Solar milestone: In 2016, additions of solar photovoltaic capacity grew by 50 percent, faster than any other kind of fuel for the first time, with China leading the way.
United States is a good bet: It's the second-largest growth market after China, and renewables are projected to rise from 15 percent of U.S. electricity capacity in 2016 despite "policy uncertainty" associated with the new Trump administration.
Getting closer to coal: IEA predicts that renewables' share of global power generation will be 30% in 2022, up from 24 percent last year, with hydropower remaining the largest total source over the forecast period.
- "While coal remains the largest source of electricity generation in 2022, renewables close in on its lead. In 2016, renewable generation was 34% less than coal but by 2022 this gap will be halved to just 17%," IEA said.