Guest essay by Eric Worrall
A recently released UN report, GLOBAL TRENDS IN RENEWABLE ENERGY INVESTMENT 2020, berates the world for not doing enough to transition to renewables.
GLOBAL TRENDS IN RENEWABLE ENERGY INVESTMENT 2020
It is nothing new to say that clean energy is better for the planet, and humanity, than energy derived from fossil fuels. Its benefits in avoiding greenhouse gas emissions, delivering cleaner air and bringing energy to marginalized communities are essential to a better future for all. What is new is that the world has a unique opportunity to accelerate clean development by putting renewable energy at the heart of Covid-19 economic recovery plans.
Governments will inject huge amounts of money into their economies as they look to bounce back from Covid-19 lockdowns, which have saved lives but stopped growth and cost jobs. This new report, Global Trends in Renewable Energy Investment 2020, shows that putting these dollars into renewables will buy more generation capacity than ever before, and help governments deliver stronger climate action under the Paris Agreement.
This is great progress, but there is room to do much more. Nations and corporations have made clean energy commitments over the next decade. Analyzing them in its focus chapter, the report finds commitments for 826GW of new non-hydro renewable power capacity by 2030, at a likely cost of around $1 trillion. However, these commitments fall far short of what is needed to limit the rise in global temperatures to less than 2 degrees Celsius under the Paris Agreement. It also falls short of last decade’s achievements, which brought around 1,200GW of new capacity for $2.7 trillion.
The U.S. edged ahead of Europe in terms of renewables investment last year. The U.S. invested $55.5 billion, up 28%, helped by a record rush of onshore wind financings to take advantage of tax credits before their expected expiry, while Europe committed $54.6 billion, down 7%.
As part of the Paris Agreement in 2015 countries agreed to a common goal of limiting the rise in global temperatures this century to “well below” 2 degrees Celsius, with an aim of keeping the increase at 1.5 degrees. Even limiting the increase to 2 degrees would require the gross addition of some 2,836GW of new non-hydro renewable energy capacity by 2030, according to the base-case scenario in BloombergNEF’s New Energy Outlook 2019. The latter’s projection of the technology mix, based on the evolution of relative costs, is for this to consist of 1,646GW of solar, 1,156GW of wind, and 34GW of other non-hydro renewables, at an estimated cost of $3.1 trillion over the decade.
This section supports the message of the latest UNEP Emission Gap Report that there is a big gulf between countries’ current ambitions, even those as expressed in their Nationally Determined Contributions for the Paris Agreement, and what the science tells us needs to be done about global emissions by 2030.
The report is hopeful costs will continue to fall.
I found the section on trends interesting; European investment in renewables fell 7% over the last year, while US investment was up 28%. For all their big talk of imposing border carbon taxes on US imports into Europe, European leaders are in no position to criticise other people’s climate efforts.