IEA sees 'massive global growth of renewables to 2030' amid COP pledge

The world's renewable power capacity is expected to surge over the rest of this decade, with global additions between 2024 and 2030 forecast to almost triple to around 5,500 GW, the International Energy Agency said Oct. 9.

Supportive policies and favorable economics are key drivers, with China alone set to account for 60% of the new renewable capacity installed, according to Renewables 2024, the IEA's annual report for the sector.

"Renewables are moving faster than national governments can set targets for," IEA Executive Director Fatih Birol said. "This is mainly driven not just by efforts to lower emissions or boost energy security -- it's increasingly because renewables today offer the cheapest option to add new power plants in almost all countries around the world."

Wind and solar additions are on track for another record in 2024, although growth is set to slow slightly compared with 2023.

By 2030, the IEA expects renewables to be meet around 46% of the world's rising electricity demand, up from around 30% in 2023.

The share of wind and solar PV is set to double to 30%. The two technologies are set to account for 95% of new renewable capacity through to 2030.

System integration

However, the report also emphasizes the need to accelerate efforts to integrate wind and solar into power systems.

The IEA recommends that countries focus on maximizing power system flexibility, expanding or modernizing electricity grids and developing storage, proposing a global 1,500 GW storage capacity target for 2030.

IEA analysis shows that nearly 70 countries that collectively account for 80% of global renewable power capacity are poised to reach or surpass their current 2030 renewable ambitions.

However, that is still not yet fully in line with the global goal set by the COP28 UN climate change conference to triple the world's renewable capacity this decade.

The report forecasts global capacity will reach 2.7 times its 2022 level by 2030.

Renewable power generation is projected to reach 17,000 TWh in 2030, up 90% from 2023, with renewables set to exceed global coal-fired power from next year.

Regional trends

Outside of China, Europe remains the biggest region for renewables, with some 700 GW to be added over the next seven years.

Seven countries -- Germany, the UK, Italy, Turkey, France, Spain and the Netherlands -- account for 70% of the capacity.

By technology, solar makes up almost 70% of the region's base-case forecast.

US renewable expansion is set to more than double over 2024-2030 to almost 500 GW, propelled by a generous Inflation Reduction Act stimulus in the form of tax incentives.

India's annual renewable capacity additions are expected to increase more quickly than any other major economy, including China.

In the IEA's main-case forecast, India's annual capacity additions quadruple to 62 GW in 2030, with a total 350 GW to be added over the period.

Wind rebound

Despite recent supply chain and macroeconomic challenges, the wind sector is expected to recover, according to the IEA.

The report sees the rate of global wind capacity additions doubling between 2024 and 2030 compared with 2017-23. For 2024, slight gains for the offshore sector are set to outweigh a dip in onshore wind, with the combined total exceeding last year's record.

Solar additions continue to surge, with global solar manufacturing capacity expected to reach more than 1,100 GW by end-2024, more than double this year's projected demand.

Utility-scale annual additions are set to exceed 300 GW for the first time this year, while distributed solar's annual growth is approaching 200 GW, the IEA said.

S&P Global Commodity Insights analysts forecast around 543 GW of new solar PV capacity and around 113 GW of new wind capacity to be added this year.

Diverging cost trends

Spot prices for solar PV modules have decreased 60% since 2022 due to falling polysilicon prices and growing supply overcapacity, the IEA said.

Module costs made up 20-40% of utility-scale solar PV system capex in 2022.

Lower module costs as well as lower prices for raw materials such as aluminum and steel, are expected to lead to a 20% decrease in solar investment costs in 2024 compared with 2022, the IEA added.

Platts, a unit of Commodity Insights, last assessed utility-scale PV modules (50-100 MW) at $9/W (FOB China), $11.15/W (DDP Europe) and $31/W (DDP US) on Oct. 8.

In contrast, average wind turbine prices offered by Western manufacturers have increased. In H1 2024, the average price was over 10% higher than in 2022, despite decreases in main input costs.

In China however, turbine prices have been declining with average wind turbine price per MW just one-third the price of Western manufacturers in H1 2024.

Turbine expenses constituted about 60% of onshore wind farm construction costs in 2022.

In total, over the seven years to 2030, Commodity Insights analysts see around 1,000 GW of new wind capacity added, with solar PV adding around 3,700 GWac (4,470 GWdc), according to their latest Clean Energy Technology market outlook.