According to a new report from the World Energy Council, renewable energy now accounts for over 30% of the total global installed power generation capacity, and 23% of total global electricity production.
The new report, entitled ‘Variable Renewables Integration in Electricity Systems 2016 – How to get it right’, draws on case studies from 32 countries across five continents, and highlights the lessons which have been learned in the wake of integrating renewable energy, the critical success factors, and the practical solutions which can be taken into the future.
Among the key findings from the report is the current level of variable renewable energy currently in place. The report found that renewable energy, including hydropower, currently accounts for approximately 30% of the total global installed power generating capacity, as well as 23% of the total global electricity production. Specifically, over the last decade, wind and solar PV have seen a meteoric rise, representing 23% and 51% respectively in terms of average annual growth in installed capacity — although, to temper that somewhat, their combined contribution to the global electricity production is only around 4%.
Unsurprisingly, therefore, the second key finding from the new report found that renewable energy has become “big business.” In 2015, a record $286 billion was invested into 154 GW of new renewable energy capacity — of which wind and solar PV accounted for 76% together. The report further solidifies previous similar conclusions, in which renewable energy is now well and truly out in front of conventional generation, which only saw 97 GW of new capacity in 2015. Additionally, the report confirmed what we have been seeing for some months now, that the general market for renewable energy capacity is slowly shifting from developed countries to the emerging economies.
Further confirming previous conclusions, the report identifies the combination of improving technologies and cost reductions as the primary driver behind declining capital expenditure and operational & maintenance costs of variable renewable energy technologies, with solar PV being a prime example.
The report also concluded that by the end of 2015, 164 counties had renewable energy support policies in place, with 95 of them identified as developing countries — not bad, considering that number was only 15 developing countries in 2005.
For good or bad, the report also identified what happens when a region or country reduces its renewable energy subsidies. Following the decrease of subsidies in the European Union, the EU’s share of global solar PV installed capacity dropped over the past four years from 75% to 41%, while the share of wind dropped from 41% to 33%.
“The success of both the development of intermittent renewables and their efficient integration in electricity systems fundamentally depends on the right market design and regulatory framework and solid regional planning to avoid bottlenecks,” explained Christoph Frei, Secretary General, World Energy Council. “We are beyond the tipping point of grand energy transition. Implementing technically and economically sound, stable policies supported by clear carbon price signals will enable this transition and take us a step closer to meeting the climate aspirations agreed at COP21.”
“Appropriate technologies and policies, including regulation and market design play a fundamental role in both development of variable renewables and their efficient integration in electricity systems,” added Alessandro Clerici, Chair of the Renewable Energy Sources Integration in Electricity Systems knowledge network.
“Policy solutions are complementary to effective and affordable technology solutions.
“What works in any particular country depends both on its individual circumstances and the quality of execution of policies. A holistic and long-term approach to system design is key when planning Variable Renewable Energy Sources integration, including honest and transparent cost assessment to incentivise investment and ensure supply security and a robust energy sector regardless of a country’s resources or geographic location.”