Overview of the Global Renewable Energy Market

Part
01
of one
Part
01

Overview of the Global Renewable Energy Market

Key Takeaways

  • In a few years, the cost of renewable energy will be a consistently cheaper source of electricity generation compared to conventional fossil fuels. The cost of producing electricity from onshore wind has dropped by about 23% since 2010. During the same period, the cost of solar photovoltaic (PV) electricity has dipped by about 73%.
  • In 2021, the U.S. state of California adopted a landmark policy directing all large trucks to be clean and electric by 2050, while all cars, SUVs, and light trucks to have zero emissions by 2035.
  • Reports published by the PR Newswire, CNBC, and IEEFA reveal that the low costs of generating energy from renewables has enticed many corporations, including Apple, Facebook, Google, Amazon, and Wal-mart, which have all promised to shift towards using renewable resources to power their operations.

Introduction

Government policies and regulations, growing investments in renewables, lower costs for renewable sources, technological advancements in renewables, and renewable energy cities are five examples of the main growth drivers in the global renewable energy market.

Government Policies and Regulations

Growing Investments in Renewables


  • In the U.S., it is anticipated that by 2023 solar and onshore wind will be economically competitive due to declining costs, resulting in new U.S. gas plants. By 2040 solar and wind energy will account for about 50% of installed capacity and over 33% of generation, marking a 4-times increase in wind capacity and a 14-times jump in solar capacity.
  • PowerChina is an example of a company investing in renewables. The company invested in a “0.5 gigawatt solar farm in southern Vietnam” which became the largest in Southeast Asia after completion in mid-2019.

Lower Costs for Renewable Sources

  • In recent years, the global costs for solar, wind, and battery storage have dropped dramatically. Presently, the cost of building a new “onshore wind facility or a grid-connected solar facility” is estimated at or below the current cost of generating electricity from a new natural gas plant.
  • In a few years, the cost of renewable energy will be a consistently cheaper source of electricity generation compared to conventional fossil fuels. The cost of producing electricity from onshore wind has dropped by about 23% since 2010. During the same period, the cost of solar photovoltaic (PV) electricity has dipped by about 73%.
  • The global solar photovoltaics (PV) cost witnessed the sharpest decline over 2010-2019 at “82%, then concentrating solar power (CSP) at 47%, onshore wind at 40%, and offshore wind at 29%.” Electricity costs from utility-scale solar PV declined 13% year-on-year to approximately seven cents ($0.068) per kilowatt-hour (kWh) in 2019, while onshore and offshore wind both dropped by about 9% year-on-year to $0.053/kWh and $0.115/kWh, respectively.
  • A PR Newswire report reveals that the low costs of generating energy from renewables has enticed many corporations, including Apple, Facebook, Google, Amazon, and Wal-mart, which have all promised to shift towards using renewable resources to power their operations.

Technological Advancements in Renewables

Renewable Energy Cities

  • Cities are also among the key drivers of the transition towards renewable energy. According to the International Renewable Energy Agency (IRENA), many cities in North America and Europe have set renewable energy targets. The organization estimates that over 80% of these cities, i.e., 671 cities are in Europe and North America.
  • The transition to renewable energy powered cities stems from the fact that presently, cities consume an estimated 67–76% of the global final energy consumption and are responsible for 71–76% of energy related CO₂ emissions. These high emissions and projected population shifts to urban settlements that will also result in more energy consumption and emissions are forcing cities to set emission targets in order to help decarbonize the global energy system.
  • States and cities leveraging this factor include California, U.S., which in 2021 adopted a landmark policy directing all large trucks to be clean and electric by 2050, while all cars, SUVs, and light trucks to have zero emissions by 2035. Across California, over 40 municipalities have adopted “ordinances requiring or strongly encouraging electric appliances and equipment in new buildings.”
  • In 2000, Barcelona became one of the first European cities that required all new and renovated buildings to power running hot water with at least 60% of solar energy. The city also proposed to operationalize a solar cooling network by the end of 2019.

Research Strategy

Renewable energy reports published by energy authorities like IRENA, the Natural Resources Defense Council, Inc. (NRDC), PV Europe, along with business news publishers like FORBES, PR Newswire, SCMP.com, and Global Compliance News, among others provided in-depth analyses and details into the core factors driving the growth of the renewable energy market. The research team focused the search on the most recent news reports to provide a more accurate and up to date account of the state of the renewable energy market. All the factors provided above include examples of companies and governments leveraging the growth drivers of the renewable energy market.

Research proposal:

Only the project owner can select the next research path.
Need related research? Let's launch your next project!
Sources
Sources

Quotes
  • "The global renewable energy transition continues to move forward at a fast pace because of rapidly falling prices, technological improvements and an increasingly favorable policy environment."
Quotes
  • "Deep penetration of renewables will be assisted by continued price drops in lithium-ion batteries and explosive growth in electric cars: “This will help renewable energy reach 74 percent penetration in Germany, 38 percent in the U.S., 55 percent in China, and 49 percent in India by 2040.”"
Quotes
  • "Policy banks in China, Japan and South Korea provided a combined US$78.9 billion for the construction of fossil fuel-fired power plants globally between 2009 and 2019, compared to just US$9.1 billion for renewable energy projects, according to a report published by environmental campaigner Greenpeace in December."
Quotes
  • "After surpassing coal consumption for the first time in 130 years, the U.S. Energy Information Administration (EIA) now projects that renewable energy will make up the vast majority of new generation capacity in 2021. Wind, solar, and battery storage are set to account for a staggering 81 percent of all new capacity this year. "
Quotes
  • "Replacing the costliest 500 gigawatts of coal capacity with solar and wind would cut annual system costs by up to USD 23 billion per year and yield a stimulus worth USD 940 billion, or around 1% of global GDP."
Quotes
  • "Michael Polsky, Chief Executive Officer and Founder of Invenergy, said that corporations are expected to be the fastest-growing customer segment of the renewable energy market."
Quotes
  • "Sources of renewable energy, such as wind and solar power, have grown at an unprecedented rate in the last decade, a trend which is expected to continue as costs continue to decline. This ongoing transition, underpinned by the growing electrification of the world’s energy needs, will have major social, economic and political implications which go well beyond the energy sector."
Quotes
  • "Key factors driving the current transitions are rising demand, technological innovations, environment concerns and also geopolitical shifts. The world energy demand is expected to continue to increase by 1.2 percent during 2017-2040 as countries work towards proving energy access to all."
Quotes
  • "Despite concerns over COVID-19, 2020 saw an estimated $303.5 billion invested in renewable energy capacity, up 2% on 2019, according to BNEF’s latest figures. "
Quotes
  • "Many countries still expect that the implementation of 100% renewable energy systems will take several decades. Yet, there are plenty of cities in the world that already today source 100% of their electricity from renewables. Now, they are taking steps to expand their ambitions to get rid of fossil fuels in heating, cooling, transport and industry."
Quotes
  • "Cities with renewable energy targets fall most commonly in the population range of 100 000 to 500 000 inhabitants. The majority of large and mega cities that have set renewable energy targets have pursued only a modest share of renewables in their energy mix."
Quotes
  • "Michigan Governor Whitmer issued a major climate executive order committing the state to achieving net-zero carbon emissions economy-wide by 2050. 2021 will be the year when the rubber hits the road as Michigan maps out equitable pathways to achieving these goals. Michigan also made significant progress on energy efficiency."
Quotes
  • "The largest players in ICT — Amazon, Apple, Facebook, Alphabet’s Google and Microsoft — have been investing in renewable energy projects for some time, and have all committed to renewable energy targets."