Renewables to surpass gas in global power mix by 2016

• 10 years ago (2013-07-02)
• David Flin

Asia 848 Europe 1061 Middle East 311 Nuclear 640 Renewables 752

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The International Energy Agency (IEA) has said that it expects power generation worldwide from hydro, wind, solar and other renewable sources will exceed gas and be twice that from nuclear by 2016. This was detailed in its second annual Medium Term Renewable Energy Market Report. According to the report, investment and deployment of renewables are accelerating in emerging and developing markets, including China, New Zealand, and Turkey.

According to the report, despite a difficult economic context, renewable power is expected to increase by 40 per cent in the next five years. Renewables are now the fastest-growing power generation sector, and will make up almost a quarter of the global power mix by 2018, up from an estimated 20 per cent in 2011. The share of non-hydro sources such as wind, solar, bioenergy, and geothermal in total power generation is expected to double, reaching 8 per cent by 2018, up from 4 per cent in 2011, and just 2 per cent in 2006.

Maria van der Hoeven, Executive Director of the IEA, said: “As their costs continue to fall, renewable power sources are increasingly standing on their own merits versus new fossil fuel generation. This is good news for a global energy system that needs to become cleaner and more diversified, but it should not be an excuse for government complacency, especially among OECD countries.”

Van der Hoeven also said: “Many renewables no longer require high economic incentives, but they do still need long-term policies that provide a predictable and reliable market and regulatory framework compatible with societal goals. And worldwide subsidies for fossil fuels remain six times greater than economic incentives for renewables.”

Two main factors are driving the positive outlook for renewable power generation. Firstly, investment and deployment are accelerating in emerging markets, where renewables help address fast-rising electricity demand, energy diversification needs, and local pollution concerns while contributing to climate change mitigation.

Secondly, renewables are becoming cost-competitive in a wider set of circumstances. For example, wind competes well with new fossil fuel power plants in several markets, including Brazil, Turkey, and New Zealand. Solar is attractive in markets with high peak prices for electricity, for instance, those resulting from oil-fired generation.