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Renewables 2017

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Renewables 2017: Detailed market analysis and overview of renewable electricity, biofuels, and heat

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Renewables 2017

  1. 1. Renewables 2017 London – 04 October 2017
  2. 2. © IEA 2017 Context Ø Policy support & technology progress continue to drive robust growth in renewables Ø Solar PV broke new records in 2016, led by China Ø Solar PV grew faster than any other form of generating capacity Ø Competitive auctions are seeing record-low prices for wind & solar Ø Prospects for renewables underpinned by need to address core energy challenges Ø Air pollution still a major problem Ø Universal access to modern energy remains a distant goal Ø Current climate pledges fall short of meeting mitigation goals
  3. 3. © IEA 2017 2016 – Renewables hitting new records driven by solar PV Renewables breaking an all-time record accounting for two thirds of global net capacity additions; For the first time solar PV becoming the global leader in net capacity growth Power capacity additions by fuel 2016 0 50 100 150 200 Renewables Gas Wind Solar PV Coal Additions (GW) Retirements
  4. 4. © IEA 2017 Price discovery through competitive auctions effectively reduces costs along the entire value chain; Auctions with long-term contracts will drive almost half of new capacity growth over 2017-22 Announced wind and solar PV average auction prices by commissioning date Competition driving costs down 0 20 40 60 80 100 120 140 160 180 2012 2013 2014 2015 2016 2017 2018 2019 2020 USD/MWh Onshore wind average auction price Solar PV average auction price
  5. 5. © IEA 2017 Renewables growth more and more dependent on wind and solar Solar PV enters a new era, becoming the undisputed leader in renewable power capacity growth; PV also accounts for 60% of the upside potential in the accelerated case Renewable electricity capacity growth by technology 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 0 200 400 600 800 1 000 1 200 1999-2004 2005-10 2011-16 2017-22 Capacity growth (GW) Additional - accelerated case Others Hydropower Solar PV Wind % from wind and solar PV (right axis)
  6. 6. © IEA 2017 China continues to lead growth while India overtakes the EU The forecast is 12% more optimistic vs. last year mainly due to solar PV revisions in China and India; Growth could be 27% higher with enhanced policies addressing regulatory uncertainties and grid integration Renewable capacity growth by country/region 0 50 100 150 200 250 300 350 400 450 500 China United States EU India Japan Brazil Africa&ME Capacity growth (GW) 2011-16 2017-22 main case Additional accelerated case
  7. 7. © IEA 2017 Solar PV enabling electrification in India, Bangladesh and sub-Saharan Africa With government policies and innovative business models, off-grid PV capacity triples in Africa and developing Asia. Small home systems bring initial electricity access to almost 70 million by 2022 Cumulative growth of off-grid solar PV applications in developing Asia and sub-Saharan Africa 0 10 20 30 40 50 60 70 80 0 500 1 000 1 500 2 000 2 500 2017 2018 2019 2020 2021 2022 millionsMW Additional SHSs Additional industrial Additional mini-grids Initial electricity access from SHS (right axis)
  8. 8. © IEA 2017 Renewables closing the gap with coal Renewable generation to expand by over a third with its share increasing from 24% in 2016 to 30% in 2022, rapidly closing the gap with coal Electricity generation by fuel 0 2 000 4 000 6 000 8 000 10 000 12 000 2002 2006 2010 2014 2018 2022 Generation (TWh) Coal Natural gas Renewables
  9. 9. © IEA 2017 Wind and solar transforming power sector - system integration becomes key More flexible power systems, adapted market design and policies will have to play a key role in integrating larger shares of wind and solar in a secure and cost-effective way VRE share in annual electricity generation 2016-22 0% 10% 20% 30% 40% 50% 60% 70% 80% Japan Brazil India China United States Australia Italy United Kingdom Germany Spain Ireland Denmark % of total generation PV share in 2016 Wind share in 2016 Additional PV share in 2022 Additional wind share in 2022
  10. 10. © IEA 2017 Surging EVs to complement biofuels in renewable transport Share of renewables in road transport increases from 4% in 2016 to almost 5% in 2022, with biofuels representing 80% of the growth led by Asia & Brazil; EV electricity consumption doubles by 2022, with renewables providing 30% of demand Biofuels 2/3 wheelers Electric cars and buses 2016 2022 4% 7% Biofuels and electric vehicles contribution to renewable energy consumption in road transport
  11. 11. © IEA 2017 Progress in renewable heat depends on strong policies Renewables share in heat consumption rises from 9% in 2016 to 11% in 2022. China leads absolute growth with new targets; EU remains the largest renewable heat consumer while total heat demand outpaces renewables growth in India Share of renewables in heat consumption by selected countries 0% 5% 10% 15% 20% 25% 2010 2012 2014 2016 2018 2020 2022 % of renewables European Union USA India China
  12. 12. © IEA 2017 Concluding remarks Ø Renewables rise by 1,000 GW to 2022, equal to half of current total coal capacity Ø Renewables generation exceeds 8,000 TWh by 2022, equal to total electricity consumption of China, India & Germany combined Ø Solar PV enters a new era leading the growth in renewables, driven by a rapid expansion in deployment & manufacturing capacity in China Ø Despite rapid growth in EVs, decarbonisation of transport is a long way off Ø Only 30% of electricity used by EVs is sourced from renewables Ø Advanced biofuels require specific incentives to bolster deployment Ø Policymakers have to turn their focus to system integration & expanding the use of renewables for heating & cooling

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