A record amount of renewable electricity was added to energy systems globally in 2021 but it remains about half of what is needed annually to be on track to reach net-zero emissions by 2050, according to the International Energy Agency.
New renewable power capacity is forecast to reach 290 gigawatts this year, surpassing last year’s record of 280GW, said the IEA in its annual review of renewable energy. This compares with the current fossil fuel and nuclear power capacity of 4,800GW.
However, higher commodity prices, which were driving up the cost of producing and transporting solar panels and wind turbines, threatened to undermine investments in the short term, the report said.
The global energy supply shortage “definitely provides a setback, but at the same time it shows us the way out”, Fatih Birol, head of the IEA, told the FT.
While commodity prices and energy bills have soared, oil and gas suppliers such as Russia’s Gazprom have reported record profits and forecast further rises.
But renewable energy sources remained “much more cost-competitive” than fossil fuels, and “nuclear is set to make a comeback in many countries”, Birol said. “A new global energy system is emerging.”
Efforts to replace fossil fuels with clean sources of energy should not be blamed for the soaring costs, he said.
The recent COP 26 climate conference sent “an unmistakable signal” to investors that the fossil fuel era was beginning to draw to a close, despite a lastminute wording change to the pledge to “phase down” coal rather than “phase out” the polluting energy source.
The latest IEA report forecasts that renewable electricity growth will accelerate faster than ever. Within five years, its total capacity is likely to exceed
4,800GW — or more than 60 per cent above 2020 levels, and the equivalent of all current global fossil fuel and nuclear capacity combined.