World close to target of tripling renewables by 2030, energy efficiency lags: IEA

The world is on track to triple renewable energy capacity by the end of the decade but is failing on energy efficiency, Fatih Birol, head of the International Energy Agency, said Jan. 23.

Renewable capacity is set to grow 2.7 times globally by 2030, close to the target of tripling additions by that date set at the UN Climate Change Conference (COP28) in the UAE in 2023, Birol said at the World Economic Forum in Davos.

The pace of additions could yet accelerate to meet the 2030 target, he said.

"Our current estimate is that with the projects that have their final investment decisions, we are going to see 2.7 times – not three times, but 2.7 times increase of renewables, which is not bad," he said.

Birol warned, however, that recent global energy efficiency gains were around 2%/year, lagging the COP28 target to double efficiency gains to 4% year by 2030.

"But for 2024, global energy efficiency improvement was even below the historical average," he said, running at just 1%. "This is a problematic area."

Energy and climate think tank Ember told S&P Global Commodity Insights the gains were thanks to the global boom in solar deployment.

Ember chief analyst Dave Jones said there were two important caveats: renewable generation must not underperform; and efficiency gains must accelerate.

"Whilst there's more solar being built, there is less wind being built than forecast, and because 1 MW of solar delivers only [the energy equivalent of] 0.5 MW of wind, this will leave a generation deficit," Jones said in an email. "Unless wind building picks up, or the overall tripling goal is exceeded, there will be a shortfall in renewable generation."

Jones also pointed to a need for more battery deployment to support the solar boom.

Analysts at Commodity Insights said there was a significant discrepancy on the renewables outlook between regions, and warned that project permitting and development timelines determined the pace of future capacity additions.

Europe stays the course

European Commission President Ursula von der Leyen reaffirmed the EU's commitment to the energy transition, saying that "Europe stays the course."

Von Der Leyen's comments come as the new US administration under Donald Trump has rapidly pushed back on climate and renewable energy targets, withdrawing from the UN Climate Change Agreement.

The EC president launched a global energy transition forum initiative at Davos, focused on sustaining momentum in the shift away from fossil fuels.

"We are not moving fast enough," she said. "No company, no country and no region can do this alone."

The three objectives of the forum are to entrench targets into Nationally Determined Contributions under the UN climate agreement, turning "collective promises into measurable progress," and to turn energy and climate targets into concrete projects to unlock global investment.

"Together, we will champion smarter financing with de-risking tools, blended finance, other solutions to lower costs and attract private capital," von der Leyen said.

"In these times of harsh geostrategic competition, predictability, certainty and reliability matters," she said. "I want to be very clear with my message: Europe stays the course and we stand ready to work with all global actors to accelerate the transition to clean energy."

Developing economies

Birol noted the disparity in renewable energy deployment, with 85% of the $2 trillion/year spent on clean energy undertaken by advanced economies and China, while the remaining 15% covered 60% of the global population in Africa, Latin America and Asia.

"It breaks my heart," he said. "Solar today is the cheapest electricity generation in the world. In Africa we have about 60% of the good quality solar energy, and yet the amount of solar electricity we generate in the entire sub-Saharan Africa is less than electricity from solar in the Netherlands."

Speaking on the same panel, Democratic Republic of Congo environment minister Eve Bazaiba Masudi called for clean technology investment in her country, ranging from hydro-electric resources to carbon sinks in its forests, as well as solar photovoltaic and mining.

"Please, this is an investment opportunity, with a very large return on investment," Masudi said.