Renewable energy has surpassed coal as the largest source of global electricity generation and it is expected to grow at a faster pace than originally thought, industry experts have found.
In its latest renewable energy market report, the International Energy Agency (IEA) said over half a million solar panels were installed every day last year, and in China, which accounted for 40 percent of all renewable increases, two wind turbines were installed every hour in 2015. “We are witnessing a transformation of global power markets led by renewables and, as is the case with other fields, the center of gravity for renewable growth is moving to emerging markets,” said Dr Fatih Birol, the executive director of the IEA.
In 2015, a record 153 gigawatts of green energy was installed, an increase of 15 percent from the previous year. The agency said the increase was in part supported by government policy as well as technology improvements and heightened competition. The heightened competition has led to mixed results for alternative energy stocks in the U.S. First Solar Inc. (FSLR), which manufactures solar panels has fallen 43 percent year-to-date, whereas NextEra Energy Inc. (NEE), which is a provider of wind and solar energy is up 20 percent in 2016.
While China is responsible for 40 percent of global renewable increases, its five year forecast shows that renewable energy will make up only half its total electricity consumption, whereas the United States, Japan and Europe will see renewable energy outpace electricity consumption. From 2015-2021 it is expected that global renewable energy growth will account for 60 percent of the increase in electricity output. (See also: 3 Countries That Produce the Most Renewable Energy.)
The agency expects costs in the renewable energy market to drop by 25 percent for solar PV and 15 percent for onshore wind.
Despite these lofty projections, the agency said there is room for further policy framework to achieve the climate change goals. “I am pleased to see that last year was one of records for renewables and that our projections for growth over the next five years are more optimistic,” said Birol.
“However, even these higher expectations remain modest compared with the huge untapped potential of renewables. The IEA will be working with governments around the world to maximize the deployment of renewables in coming years.”