Solar Power Europe Predicts EU Will Reach Its Renewable Energy Goal 3 Years Early

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The 2023 annual report from Solar Power Europe comes to a startling conclusion. It says the EU will reach the renewable energy goal it set for 2030 three years early. The report is 148 pages long, so we are going to summarize it for you. (You’re welcome!) It starts with this introduction:

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Solar is on the fast track. In 2022, the world installed 239 GW of new solar, finally surpassing the TW-scale. That’s 45% more solar power capacity than the year before. The positive market developments in the first months of 2023 promise another solar boom year, expected to result in 341 GW of newly added solar to the grid by the end of the year — equal to 43% growth.

The reasons for this spectacular performance are obvious. It comes down to the unmatched versatility of solar — powering individual energy self sufficiency and comparatively quick deploying utility scale projects at competitive low cost. Despite solar’s levelised cost of electricity (LCOE) sliding upwards due to supply chain issues and inflation recently, it remains profoundly cheaper to produce electricity from solar than from new fossil fuel and nuclear power sources.

What changed for solar power in 2022 — and why the researchers consider that year an inflection point — is the technology’s newly discovered image by a growing number of policymakers. Solar power now enjoys widespread acceptance as the key tool to achieve local energy security in the midterm.

During the recent fossil fuel sparked energy crisis, the International Energy Agency (IEA) used two reports to highlight solar’s critical role to reduce the European Union’s dependence on Russian gas. The EU Solar Strategy of May 2022 even called solar the ‘kingpin’ of the continent’s effort to get off Russian gas. Such geostrategic considerations are applicable for other energy importing countries as well.

In other words, solar has now untangled what was previously considered a Gordian knot — the so-called energy trilemma of sustainability, affordability, and security of supply.

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According to Politico, the data from Solar Power Europe suggests 23 countries will reach their solar installation targets by 2027 instead of in 2030 as originally planned. That mirrors a global trend, and means millions more tons of greenhouse gas emissions are being saved each year than predicted.

“[Solar] development has been spectacular,” said Javier Esparrago, an energy expert at the European Environment Agency, arguing that the fast roll out ultimately “all boils down to [the] costs” of solar power per kilowatt-hour falling by 90 percent in the past decade.

In part, the explosive growth is down to plummeting prices for solar panels being mass produced in China. The war in Ukraine has also created a major incentive for countries to push ahead with solar installations as a way to lower their dependency on Russian energy.

The rapid increase in solar energy does have a few drawbacks, however. It is causing midday energy prices to fall precipitously, said Esparrago. In some countries, the lack of battery storage facilities to collect that energy and hold it for use later in the day when it is more valuable means grid operators often order solar plants to shut down at times of low demand, which effectively wastes their energy production capability.

Earlier this month, 19 European solar and renewables associations wrote to the European Commission to express their concern about the practice, citing its use in countries like Poland and the Czech Republic. Improvements to the electrical grid and adding energy storage systems are crucial to adding more renewable energy to the national grids.

Theory Vs. Reality

It is common knowledge that the International Energy Agency often makes projections that are conservative — some might say shockingly low. That may be because the agency doesn’t want to be giving people false hopes. Nevertheless, in June the IEA revised its renewable energy forecast for the European Union upward by a rather hefty 38% — mostly attributable to a significant rise in residential and commercial solar installations.

“To be honest, we’ve never been very good … our most optimistic predictions have nearly always undershot the market,” said Jenny Chase, a solar analyst at BloombergNEF who has closely followed the sector for almost two decades. She ascribed those lower predictions to a combination of factors, including how difficult it is to estimate the cost and efficiency improvements in Chinese manufacturing of solar panels each year.

That data quickly goes out of date. Last year, China installed 107 GW of solar output — roughly equivalent to the entire historical installed capacity of the U.S. — and is likely to add around double that in 2023, she told Politico.

It’s also tricky to understand when solar roll-out will eventually plateau. Those prediction errors could mean climate change efforts are going better than expected worldwide — especially as major economies join the race to install more solar.

In 2022, solar deployment meant the world saved 230 million tons of CO2 emissions, the IEA found, around double the annual emissions of Belgium. Growth continually beating expectations means “at the global level [emissions] have been reduced and highly mitigated,” said the EEA’s Esparrago.

Solar Challenges Ahead

It is difficult to know how long the solar boom will continue. Reducing grid congestion and training enough workers for jobs in the solar sector — which will need about 1 million skilled workers by 2030 —  is both “a challenge and an opportunity” that requires more vocational training schemes, said Raffaele Rossi, head of market intelligence at SolarPower Europe.

As the EU seeks to reduce its reliance on China for solar production and bring manufacturing back home, another risk is that it creates overly stringent criteria for imports, slowing down growth, Rossi added. Therefore, the EU Commission’s proposed Net Zero Industry Act, which sets new homegrown solar manufacturing targets by 2030, needs to be developed in “a balanced manner” that also includes greater EU subsidies. “Setting a target that is reasonable and attainable, but at the same time ambitious, is important for the evolution of the sector,” he said.

The Takeaway

It sounds so simple. Sunshine is free and can power the needs of human society for millennia. But collecting it and distributing it equitably is an enormous challenge that requires massive cooperation at all levels of government and in every country in the world. Think about that for a moment. How likely is that to happen? Does the fact that it has never happened in the past mean it can never happen in the future?

As much as the news that Europe will reach its solar energy goal three years early may be, the ongoing and accelerating climate emergency means Europe — and all other parts of the world — will need to continue finding ways to decarbonize their economies as quickly as possible. We can do this — if we all work together. But increasing international tensions as major powers jockey for position on the world stage could bring it all crashing down.

Those geo-political considerations may make all the difference between transitioning to a sustainable society and leaving a dead planet behind as humanity’s epitaph. There’s a lot that needs to go right before we can relax. The damage done by burning fossil fuels will take centuries to ameliorate. So congratulations everyone for making the clean energy revolution move faster, but there’s still so much more to do.