Renewable Energy Growth and Plunging Costs Make the COP28 Target Possible

Global renewable energy growth is at a record high, with technology costs falling and investments increasing at an unprecedented rate. As a result, many countries are getting ahead of the curve by adding new capacity. Other green technologies, including electric vehicles and battery storage, are also enjoying increased adoption. While all these factors provide a stable foundation for achieving the target of tripling clean energy capacity by 2030, they won’t be sufficient without stronger policy support and financing ambition.

Zero Carbon Analytics: Unprecedented Renewable Energy Capacity Growth, Increased Investments and Plunging Costs

After examining the growth in clean energy technologies across different regions, Zero Carbon Analytics’ latest report finds that global capacity has tripled over the past decade. At the same time, costs have plunged significantly.

Since the signing of the Paris Agreement in 2015, electricity generation from solar PV alone has increased by over 400%. Other green technologies are also booming.

The authors note that EV sales have tripled in just three years. The amount of energy storage added in 2023 equals 94% of the total. According to the report, in 2022, sales of heat pumps jumped by 11%, marking the second year in a row where the growth has hit the double digits.

Since 2020, clean energy investments have jumped by 40%, surpassing the amount poured into fossil fuels.

The first half of 2023 alone saw USD 358 billion in renewables investment. This is the highest of any six-month period in history. As a result, added renewable energy capacity is expected to be 50% higher than in 2022, reaching over 500 GW.

This significant investment growth has unlocked two fundamental benefits. First, it has led to a massive reduction in clean energy technology costs. For example, the cost of solar PV, wind, heat pumps and batteries fell by an average of 80% between 2010 and 2022 despite inflation. Next, it has enabled countries to unlock notable cost savings, reaching USD 521 billion in 2022 alone.

Spotlight on Asia: The Main Driver Behind Global Renewable Energy Adoption Growth

Zero Carbon Analytics finds that Asia has demonstrated the fastest growth rate in wind and solar power capacity addition globally. At a remarkable 35% growth rate per year, the sector has outpaced all other regions since the Paris Agreement. The installed wind and solar energy capacity increased by 300% to over 1 TW since 2015.

As of 2022, Asia accounts for 52.5% of global wind and solar capacity, making it a leader in this field. Renewable energy deployment since 2000 has helped Asia generate over USD 199 billion in fossil fuel cost savings in 2022.

Clean energy investments in the region have also been growing steadily, with an annual average growth rate of 23% since 2004. In 2022, Asia saw USD 345 billion in renewables investments, with China responsible for 80%. By 2030, renewable energy generation investments will double to USD 1.3 trillion.

China

Between 2000 and 2022, China marked the fastest-growing wind and solar power deployment globally. The country has managed to double its wind capacity every 1.5 years and its solar capacity every 2.5 years.

“China is racing ahead in the shift to clean energy,” says Li Shuo, incoming director of the China Climate Hub, Asia Society Policy Institute. “Since the Paris Agreement, China’s renewables capacity has soared, and we know it’s expected to surpass its goal to increase solar and wind capacity to over 1,200 GW by 2030,” he adds.

China is also the leading user and manufacturer of various green technologies, including solar panels, wind turbines, batteries and storage, EVs and more.

Other Asian Nations

Vietnam has increased its solar power capacity by 18,380% in just four years (2018-2022). The growth rates have crushed the government’s targets.

In India, sales of EVs have registered a 3,000% increase from 2015. Between 2016 and 2022, the country doubled its solar and wind capacity over fivefold. As a result, its clean energy growth outpaces that of coal power. 

National Ambition, Falling Costs and Increased Investments Bring Us Closer to COP28 Goal

After the G20 backed the IEA and IRENA’s calls for tripling global renewable energy capacity and doubling energy efficiency improvements by 2030, COP28 countries officially agreed. As per the target, the total clean energy capacity will need to reach 11 TW by the decade’s end. As a result, in 2030, renewables will generate 40% of global electricity capacity.

While the target is highly ambitious, it isn’t out of reach. IRENA even describes it as “the most realistic course correction” to align with a 1.5°C pathway. 

What Would It Take to Triple Renewable Energy Capacity by 2030?

Ember Climate estimates that if the world maintains its current 2023 pace and adds 500 GW of new renewable energy capacity from 2024 to 2030, global capacity will more than double, reaching 7.3 TW. 

However, to triple it to 11 GW by the decade’s end, annual additions should jump by 17% per year, reaching 1,500 GW in 2030.

According to Ember, tripling wind and solar generation and doubling energy efficiency savings would ensure 85% of the reductions in fossil fuel use needed by 2030 to meet global climate goals.

Many countries are already moving in that direction. For example, the organisation notes that some 10 nations plan to triple their clean energy capacity by 2030. Meanwhile, 12 are already deploying renewables faster in 2023 than their 2030 targets require. Another 22 countries already have more wind and solar power capacity in the pipeline to exceed their 2030 clean energy targets.

However, not all countries are making strides. Ember identifies Australia, Japan, South Korea and the UAE as big emitters that could step up their targets.

The IEA also finds the target achievable. Moreover, it notes that tripling renewables is the single leading measure to cut emissions by 2030 and keep the 1.5°C goal within reach.

Furthermore, the IEA notes that global electricity generation from renewables could overtake coal as early as 2024, depending on weather conditions. 

At the same time, manufacturing capacity for all solar PV production segments is expected to double, reaching more than 1,000 GW a year by 2024. China will lead the growth. Based on those trends, the world will have enough solar PV manufacturing capacity in 2030 to meet the annual global demand required by the net-zero pathway.

Policy Support and Increased Financing Remain Crucial

Kasandra O’Malia, project manager for Global Energy Monitor’s Global Solar Power Tracker, says, “Governments, banks, corporations, and individuals all have a responsibility to double down on bringing projects to a timely completion and not letting them fall through the cracks.” 

According to IRENA Director-General Francesco La Camera, the NDC updates in 2025 are a prime opportunity to leap forward.

Two factors determine whether the green energy transition will unfold at the pace required for a net-zero scenario: market fundamentals and policy support. 

With renewable energy technology’s decreasing costs, increased manufacturing capacity and faster time-to-market are inevitable. This stands as the basis for affordable, sustainable and clean electricity. China, for example, has already brought the cost of solar power down to under USD 0.014 per kWh.

The key is whether governments can provide greater policy support, easing project permissions and removing administrative burdens for developers.

As Christiana Figueres, former head of UNFCCC and co-founder of Global Optimism, says, “It’s indeed exciting to see the energy sector evolving, but our mindset must evolve too.”