According to the IEA's report on Wednesday, renewables accounted for almost two-thirds of net new power capacity in 2016.
The world's renewable electricity capacity will expand by about 1 TW between 2017 and 2022, led by solar, which is entering a new era following 50% growth in 2016, the International Energy Agency (IEA) said today. "This growth is enough to overtake renewable expansion in the European Union for the first time", the report said.
"What we are witnessing is the birth of a new era in solar PV. We expect that solar PV capacity growth will be higher than any other renewable technology through 2022", Birol added. Under an accelerated case, the renewable capacity could grow by 1,150 GW by 2022.
China, India and the U.S. will account for two-thirds of global renewable expansion by 2022.
The IEA said renewables will continue to show strong growth over the coming years with electricity capacity set to increase by more than almost 1,000 gigawatts (GW), or 43 per cent, by 2022. "But this year, the solar power plant additions are higher than that of wind, that of coal, that of gas and that of nuclear". The forecast is 12% higher than a year ago, mainly as a result of upward revisions for solar additions in China and India. It said China's renewables' growth is largely driven by concerns about air pollution and capacity targets that were outlined in the country's 13th five-year plan to 2020.
The recognition in China dominating PV installations, which accounted for around 50% of total in 2016 was another positive but the IEA claimed that the "growing cost of renewable subsidies and grid integration issues remain two important challenges to further expansion". Total solar PV capacity by then would exceed the combined total power capacities of India and Japan today, the IEA said.
The IEA also recognised PV growth in 2016 also delivered record-low auction prices for electricity generation, which fell as low as 3 cents per kwh (or kilowatt hour), with emerging markets such as the UAE, Mexico and Chile becoming low price leaders.
However, it said the share of renewables in total road transport energy consumption remains limited, increasing only from 4 per cent in 2016 to nearly 5 per cent in 2022. Biofuels will still account for over 90% of renewable energy in road transport by 2022.