The International Energy Agency has concluded that only electric vehicles, energy storage, and solar PV & onshore wind, out of all clean energy technologies tracked by the Agency, can be considered “green” and “on track toward a sustainable energy transition.”
These are the findings from the International Energy Agency’s (IEA) Tracking Clean Energy Progress 2017 report, published this week, which tracks 26 separate technologies and examines the progress of each technology as they fit into the interim 2°C scenario targets in 2025 — the 2DS scenario, defined by the IEA as “an energy system deployment pathway and an emissions trajectory consistent with at least a 50% chance of limiting the average global temperature increase to 2°C.” According to the latest edition of the report, only electric vehicles, energy storage, and solar PV & onshore wind can be clearly classified as “green.”
“While presently representing only a small share of the total energy system, these technologies are rapidly scaling up and continue to strengthen their position as mainstream energy solutions,” the authors of the report conclude.
For electric vehicles, the IEA highlights the fact that over 750,000 plug-in electric vehicles (PEV) were sold worldwide in 2016, and that the global stock has reached 2 million units in circulation. PEV sales grew by 40% between 2015 and 2016, in line with the objectives of the 2DS scenario, even though it is a slowdown from the 70% growth rate observed between 2014 and 2015. Moving forward, the IEA recommends that the electric vehicle industry “Prioritise financial incentives for purchasing PEVs and the availability of charging infrastructure,” as well as offering local incentives and using public procurement programs.
The energy storage sector is also on track with the 2DS scenario “due to positive market and policy trends” which has helped the sector install 930 megawatts (MW) in 2016, according to the IEA, but they point out that an additional 20 gigawatts (GW) of new capacity is needed by 2025. Therefore, to remain on track, “technology deployment will need to continue at its current growth trajectory and grow twenty fold over the next decade.”
Meanwhile, the solar PV and onshore wind industries are also on track with the 2DS scenario, and expected to grow by 2.5 times and by 1.7 times respectively between 2015 and 2020. To foster continued growth, the IEA recommends implementing “system-friendly solar PV and wind deployment and address market design challenges to improve grid integration of renewables.”
The IEA has often come under fire for its “out of touch” and pessimistic scenarios and forecasts. I’m not sure if the same can be applied to this situation, but I was nevertheless surprised to find the IEA conclude that offshore wind and hydropower (a combined duo) were not classified as “green,” but as “more efforts needed.” This is undoubtedly true — though, I would suggest that title should be attached to all technologies — but offshore wind particularly has had a phenomenal recent 18 months, if not in capacity additions (which slowed in 2016) then in the cost reductions for future projects expected to be installed over the next few years. The IEA recommendations for offshore wind and hydropower include ensuring “timely grid connection of offshore wind plants, and continue implementing policies that spur competition to achieve further cost reductions for offshore wind.” While this is a grand purpose, one could argue that we have already seen tremendous cost reductions.
Over the last 12 months alone we have seen offshore wind auction results that have exceeded all expectations, leading to three separate auction results being granted subsidy-free. In fact, it could be argued — and I would in fact argue — that the issue is currently not with furthering cost reductions, but bringing existing cost reductions to the attention of policymakers throughout Europe so as to affect further decision-making and support.