On 2 October 2015, the International Energy Agency (IEA) released its Medium-Term Renewable Energy Market Report 2015, which shows that renewable energy will represent the largest single source of electricity growth over the next five years, driven by falling costs and aggressive expansion in emerging economies. Pointing to the great promise renewables hold for affordably mitigating climate change and enhancing energy security, the report warns governments to reduce policy uncertainties that are acting as brakes on greater deployment.
Releasing the report at the G20 Energy Ministers Meeting that took place on 2 October 2015 in Istanbul, Turkey, the IEA Executive Director Fatih Birol said: “Renewables are poised to seize the crucial top spot in global power supply growth, but this is hardly time for complacency. Governments must remove the question marks over renewables if these technologies are to achieve their full potential, and put our energy system on a more secure, sustainable path.”
Furthermore, the report shows that the geography of renewables' deployment will increasingly shift to emerging economies and developing countries, which will make up two-thirds of the renewable electricity expansion to 2020. China alone will account for nearly 40% of total renewable power capacity growth and requires almost one-third of new investment to 2020.
The IEA report also highlights risks, stating that financing remains key to achieving sustained investment. Regulatory barriers, grid constraints, and macroeconomic conditions pose challenges in many emerging economies. In industrialised countries, the rapid deployment of renewables requires scaling down fossil-fired power plants, putting incumbent utilities under pressure. Wavering policy commitments to decarbonisation and diversification in response to such effects can undermine investor confidence and retroactive changes can destroy it. Consequently, global growth in the report’s main case forecast is not as fast as it could be – and annual installations level off, falling short of what’s needed to put renewables on track to meet longer-term climate change objectives.
For further information, please visit the relevant IEA website.