Record build-out worldwide of renewable power plant in 2021 has been outpaced by overall growth in global energy demand, with international governments’ decision to spend some $18trn on fossil fuel subsidies undermining a green recovery from the global Covid-19 pandemic, according to new figures from REN21.
The think-tank’s annual Renewables Global Status Report found the share of renewables in global energy use “stagnated” in 2021 – and has inched up only from 8.7% in 2009 to 11.7% in 2019, despite the market-changing growth of wind and solar production over this decade.
In the electricity sector, unprecedented additions in renewables capacity – 316GW, up 17% from 2020, and generation – 7,800TWh – fell short of meeting the total consumption increase of 5%, with a “particularly worrying lack of progress” in transport, where the share of clean energy reached only 3.7%, on latest data, from a sector that accounts for nearly a third of global energy consumption.
“The world has seen record uptake of renewables, record capacity installation driven by wind and PV because of the massive cost reductions [in levellised cost of energy], but it is clear that the ‘detransformations’ of the energy system required are not there,” said REN21 executive director Rana Adib, speaking to Recharge ahead of the report launch.
“If governments don’t take the right action today to phase out fossil fuels swiftly, investing in renewable energy and energy efficiency we will not get [to Paris Agreement targets of a 1.5°C rise in global temperatures compare to pre-industrial levels]. This is even more important today given the energy price crisis that started last autumn is creating real pressure on the global economy.”
If there is “good news”, Adib added, “it is that the [renewables] sector has shown a real economic resilience which underlines even more that this is a sector that provide the lowest cost option for the energy transition around the world”.
An International Energy Agency (IEA) study commissioned from the UK's Imperial College revealed last year that renewable energy projects have seen a 367% greater total return than fossils since 2010, with advanced markets’ returns outweighing oil, gas and coal by 2,300% in the same period, and 22% higher returns in developing economies.
“We see there is in this an opportunity for renewable energy to move out of a climate and environmental space into one at the centre of the global economy, and at the same time help address the wider geopolitical realities related to energy security,” said Abid.
The REN report spotlights the climate action-slowing impact of government increases in oil, gas and coal subsidies, which shot up over the pandemic to reach the equivalent of 7% of global domestic product.
“We are not moving forward at a meaningful pace [in shifting capital expenditure (Capex) away from fossil fuels to renewables],” stressed Abid. “Even in wind and PV we are not seeing the [Capex] needed to underpin the exponential increase in build-out required today – despite, for instance, the IEA spelling out in its net-zero scenario a ‘method’ to do so.
“We need to end the fossil fuel era. There is a systemic inertia that is there. Many governments are responding to the spikes in energy prices much as they have the pressures on the energy system during the pandemic – subsidies of fossil fuels. And yet they have a real alternative to this in the form of renewables.”
The REN21 report highlighted that while a record 135 countries pledged to achieve net-zero greenhouse gas emissions by 2050 in the run-up to COP26 climate conference in 2021, only 84 had “economy-wide targets” for renewable energy, and only 39 for 100% clean energy.
For nations to meet tabled net-zero pledges “will require massive efforts, and the momentum associated with Covid-19 has passed untapped”, said Abid. “Despite important green recovery measures in many countries, the strong economic rebound in 2021 – with global real GDP growing 6.1% – contributed to a 4.6% rise in final energy consumption, offsetting the growth of renewables.
“In China alone, final energy consumption rose 10% between 2009 and 2019. Most of the increase in global energy use in 2021 was met by fossil fuels, resulting in the largest surge in carbon dioxide emissions in history, up more than 2 billion tonnes worldwide.”
“The old energy regime is collapsing before our eyes – and with it, the global economy,” said Adib. “Yet crisis response and climate goals must not be in conflict. Renewables are the most affordable and best solution to tackle energy price fluctuations. We must boost the share of renewables and make them a priority of economic and industrial policy. We can’t fight a fire with more fire.”
