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The objective to triple global renewables capacity by 2030 is a tall order for all governments.

At least 1,000 GW of new renewables capacity are needed globally each year to reach the goal, or more than double today’s rate.

Markets worldwide face substantially different circumstances to build more renewables.

The projected renewable capacity additions of China alone during 2024–2030 are almost the sum of all other additions worldwide. Existing renewable penetration levels, project development timelines, power demand growth rates and access to funding affect the potential scale of development.

The UN's 28th annual climate change conference, known as COP28, ended Dec. 13, 2023, with parties pledging to triple global renewable energy capacity by 2030. How difficult is this goal? For which markets is the objective easier or harder to achieve?

The objective to triple renewables capacity is a tall order for all governments

The outlook for renewables capacity to 2030 derives from the global pipeline of generation projects, the policy environment and market dynamics. From its analysis of these matters, S&P Global Commodity Insights concludes that although the tripling objective is not established country by country — it is global, or a “collective” goal — achieving it will require accelerating renewable deployments in markets with substantially different circumstances.

Our reference-case outlooks suggest that global renewables installed capacity will more than double from the 2022 level to over 7,000 GW by 2030, but it is unlikely to triple before 2037. Among the major markets, China is one of the closest to achieving the tripling objective, but it has not signed the Global Renewables and Energy Efficiency Pledge. Other markets have a slim chance to triple their current capacity before 2035, with the EU and Latin America stretching into the 2040s, assuming hydropower is included in the target.

Tripling the 2022 installed capacity will require at least 1,000 GW of new additions per year, more than double the current level.

Global renewables capacity grew a remarkable 6% annually over the past five years. Yet a 17% annual growth rate from 2024 to 2030 is needed to fulfill the tripling pledge. Renewable capacity additions soared to more than 400 GW in 2023, but the pace of new additions must increase to achieve the goal. Tripling the 2022 installed capacity will require at least 1,000 GW of new additions per year, more than double the current level.

However, markets are not contributing to the target equally. Countries with limited renewables capacity today are under less pressure given that their contributions will not move the needle substantially. For instance, if all countries in Southeast Asia quadruple (rather than triple) their installed capacity, it would only represent 10% of the expected effort from the US. The projected renewable capacity additions of China alone during 2024–2030 are almost the sum of all other additions worldwide. In other words, fulfilling the global pledge is nearly impossible without China.

Markets face substantially different circumstances to build more renewables

Several factors impact how much renewables capacity different markets may add in the coming years.

  • The higher the share of variable renewables in a market, the harder it is to add more. The availability of project sites, grid constraints and reliability risks worsen where renewables growth has been rapid. In Europe, for example, wind and solar already represent more than 25% of total generation, and 42% when including hydropower. Insufficient investment in transmission networks — a common theme in many regions — compounds the reliability challenge. Such markets will need to look beyond simply adding cheap variable solar and wind resources and invest in transmission reinforcements, demand-side management and dispatchable, reliable clean power sources.
  • Project development timelines vary greatly. Permitting and interconnection queues are lengthening in several core markets worldwide, owing to the growing demand for renewable energy, local opposition and regulatory complexities. Our research shows that, on average, permitting a utility-scale solar project takes three years in Europe and the US, or 60% of the project development cycle. In Europe, onshore wind permitting can take 3.5 years on average, almost as long as for offshore wind; in contrast, completing projects in China is much faster and can take half to a fifth as long.

In Europe, onshore wind permitting can take 3.5 years on average, almost as long as for offshore wind; in contrast, completing projects in China is much faster and can take half to a fifth as long.

  • Power demand growth affects the scope for renewables expansion. Renewable additions in emerging economies will primarily satisfy growing electricity demand, while in developed economies, they will often replace existing thermal capacity. This shapes the pledge’s impact on renewable penetration rates and how renewables fit with other system requirements. China and India, another non-signatory of the Global Renewables and Energy Efficiency Pledge, have favorable fundamentals to build more renewables capacity.

  • Access to public funds and private capital varies. Many emerging economies will face difficulties competing for green investment while improving basic access to energy. High interest rates and political and economic uncertainty lead investors to retrench to mature markets. According to S&P Global Commodity Insights, the substantial government incentives offered in the US, Europe and China will lead the three markets to comprise more than 70% of global renewables additions during 2024–2030. Changes in the renewables supply chain, stimulated by new policies on local content requirements, will also affect the geographic distribution of builds. A key ask from the Global South is for developed countries to allocate capital and development assistance to developing countries.

  • There is supply chain capacity to meet the challenge, but nearshoring/onshoring policies can create bottlenecks and increase costs. Global solar and wind supply chains are expanding rapidly. In 2024, annual photovoltaic (PV) module production capacity will be twice as high as demand, and most of this capacity is from newer, better production lines with higher efficiency and lower cost. Manufacturing capacity for wind energy is also increasing. China continues to lead the world in clean technology manufacturing. This oversupply will make nearshoring cleantech manufacturing difficult. Nearshoring cleantech manufacturing will come at the cost of a more expensive transition; for example, PV modules in the US already cost more than twice as much as elsewhere. 

Nearshoring cleantech manufacturing will come at the cost of a more expensive transition; for example, PV modules in the US already cost more than twice as much as elsewhere.

The Global Renewables and Energy Efficiency Pledge includes hydropower in the 2030 target, but the COP28 Global Stocktake agreement does not mention it. This difference has a major impact on the growth potential for power markets with significant hydropower capacity. Latin America and Scandinavia have large-scale hydropower fleets with very limited scope for growth. Even in less hydro-dependent regions, including the resource in the pledge complicates its achievement. For example, in our reference outlook, India will triple its solar and wind capacity by 2033, but it will triple its renewables capacity including hydropower by 2036.

Looking forward

Policymakers and other stakeholders will need to consider these geographic realities when elaborating new strategies that support the landmark pledge. These realities also demonstrate the benefits for governments and companies worldwide to collaborate to reach the objective in an economically and technically practical way.

This article was authored by a cross-section of representatives from S&P Global and in certain circumstances external guest authors. The views expressed are those of the authors and do not necessarily reflect the views or positions of any entities they represent and are not necessarily reflected in the products and services those entities offer. This research is a publication of S&P Global and does not comment on current or future credit ratings or credit rating methodologies.

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COP28 pledge