World Energy Outlook 2019

Renewables

Introduction

The past decade has seen strong growth in the deployment of renewable energy technologies, with the power sector leading the way thanks to sharp cost reductions for solar photovoltaic (PV) and wind power. However the uptake of renewables has been slower in end-use sectors such as industry and buildings.

Electricity generation from renewables continued to grow in 2018 with output up by 450 terawatt-hours (TWh) (or 7%) compared to the previous year, accounting for more than a quarter of total power generation. Growth in output from solar PV, wind and hydro accounted for 90% of the increase. Around 180 gigawatts (GW) of new renewable power capacity was added in 2018, which is the same level as the previous year, although the IEA’s estimate for 2019 suggests a resumption of robust growth in annual renewable additions.

Outlook by scenario

Renewable electricity capacity by region and scenario, 2018-2040

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Renewable electricity generation by region and scenario, 2018-2040

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Cost reductions in renewables and advances in digital technologies are opening huge opportunities for energy transitions. Wind and solar PV provide more than half of the additional electricity generation to 2040 in the Stated Policies Scenario and almost all the growth in the Sustainable Development Scenario.

In the Stated Policies Scenario, the amount of renewables (excluding traditional use of biomass) in final energy consumption increases from more than 990 Mtoe today to almost 2 260 Mtoe in 2040. The share of renewables in global heat increases by 60% and reaches nearly 940 Mtoe in 2040, thanks to substantial growth in the modern use of bioenergy (pellets in boilers and stoves, biogas and biomethane, biofuels), renewable electricity and also of solar thermal. Meanwhile the contribution of renewables to the transport sector triples to around 300 Mtoe, three-quarters of which comes from biofuels.

In the Sustainable Development Scenario, additional measures to incentivise investment in renewables-based electricity, bioenergy, solar heat, geothermal heat and electrification push the share of renewables to two-thirds of electricity generation output and 37% of final energy consumption. By 2040, expected output from wind (8 300 TWh) and solar PV (7 200 TWh) are expected to exceed hydropower (6 950 TWh), while the share of heat coming from renewables in 2040 increases to 30% of the total or to 1 200 Mtoe. In the transport sector, consumption of energy from renewable sources is projected to increase to 600 Mtoe, with biofuels accounting for around 60% and electricity from renewable sources consumed by electric vehicles and rail accounting for the remainder.

Highlights

In the Stated Policies Scenario, nearly 8 500 GW of new power capacity is added globally by 2040, of which two-thirds is renewables. Renewables account for the majority of capacity additions in most regions. This includes about 80% of additions in the European Union and China, but they provide less than half of additions in Southeast Asia and the Middle East. Solar PV provides the largest share of renewable capacity additions in most regions, including China and India.

 

In the Sustainable Development Scenario, renewables account for around 80% of capacity additions in all regions, complemented mainly by nuclear power and carbon capture technologies.

Renewables share in capacity additions by region in the Stated Policies and Sustainable Development scenarios, 2019-2040

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Renewables-based power investment declined slightly in 2018 around $390 billion yet a dollar of renewables spending continued to buy more generation capacity than in the past. Whichever scenario the world follows, investment in renewables technologies would need to accelerate.

 

In the Stated Policies Scenario, investment in renewables reaches a cumulative total between now and 2040 of around $10 trillion. In the Sustainable Development Scenario, investment grows at a much faster rate, reflecting stronger policy support and the central role that these clean energy technologies play in reaching sustainable energy goals.

Global annual average investment in renewables by scenario (billion USD 2018)

    Stated Policies Sustainable Development Change 2018 vs
2031-2040
  2018 2019-30 2031-40 2019-30 2031-40 STEPS SDS
Renewables-based power generation 304 329 378 528 636 24% 109%
    Wind 89 111 122 180 223 37% 151%
    Solar PV 135 116 125 179 191 -7% 41%
End-use sectors 25 117 139 124 145 456% 480%
Total 329 456 517 652 781 57% 137%
Cumulative   5 477 5 166 7 829 7 802    

Note: Renewables for end-use include solar thermal, bioenergy and geothermal applications for heating

Offshore wind has the technical potential to meet today’s electricity demand many times over. It is a variable source of generation, but offshore wind offers considerably higher capacity factors than solar PV and onshore wind thanks to ever-larger turbines that tap higher and more reliable wind speeds farther away from shore.

 

There are further innovations on the horizon, including floating turbines that can open up new resources and markets.

 

Increasingly cost-competitive offshore wind projects are on course to attract a trillion dollars of investment to 2040. Europe’s success with the technology has sparked interest in China, the United States and elsewhere. In the Sustainable Development Scenario, offshore wind rivals its onshore counterpart as the leading source of electricity generation in the European Union, paving the way to full decarbonisation of Europe’s power sector. Even higher deployment is possible if offshore wind becomes the foundation for the production of low-carbon hydrogen.

Installed capacity of offshore wind by region and scenario, 2018-2040

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While the technologies to produce biogas are not new, there has been a resurgence of interest in their potential in recent years. IEA analysis indicates that over 570 Mtoe per year of biogas could be produced sustainably today, equivalent to almost 20% of global natural gas demand. Emerging economies account for two-thirds of the global biogas potential. However, biogas everywhere requires supportive policies if it is to be fully utilised.

 

The benefits of using biogas are many and the economic case improves considerably if these non-economic benefits are fully taken into account. In the Stated Policies Scenario, close to 150 Mtoe of biogas is produced globally by 2040, over 40% of which is in China and India. In the Sustainable Development Scenario, there is a more pronounced increase in biogas production: it reaches around 330 Mtoe in 2040, utilising around 40% of the total sustainable technical potential.

Global biogas demand in the Sustainable Development Scenario, 2018-2040

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