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22 01 GLOBAL OVERVIEW Figure 2. Average Annual Growth Rates of Renewable Energy Capacity and Biofuels Production, End-2008 – 2013 Geothermal power Hydro- power Solar PV CSP Wind % 60 50 40 30 20 10 0 5.6 11.4 4 4.2 39 35 15.7 12.4 5.7 11 55 48 14 21 3.2 3.7 Growth Rate in 2013 Growth Rate End-2008 through 2013 Power Heating Transport Ethanol production Solar heating Biodiesel production Figure 2. Average Annual Growth Rates of Renewable Energy Capacity and Biofuels Production, End-2008–2013 Further, renewables operate on an un-level playing field in which energy prices do not fully reflect externalities. Global subsidies for fossil fuels and nuclear power remain high despite discussions about their phase-out, encouraging inefficient energy use while also hindering investment in renewables.10 Depending on the calculation method used, estimates for the global cost of fossil fuel subsidies range from USD 544 billion to USD 1.9 trillion—several times higher than those for renewable energy.11 (See Sidebar 6, GSR 2013.) Electricgrid-relatedchallengescontinuedin2013.Theseinclude lack of transmission infrastructure in some locations, delays in grid connection, and sometimes the curtailment of renewable generation.12 At high penetration levels, variable renewables can pose challenges for electricity grid system operators. A growing number of countries is aiding integration through improvements in grid management practices, improving system flexibility, and modifying existing grid infrastructure and technologies.13 (See Feature, GSR 2013.) Overall, with some exceptions in Europe and the United States, renewables saw a number of significant and positive developments in 2013.14 Wind power moved more firmly into Africa and Latin America; concentrating solar thermal power (CSP) shifted its focus further to the Middle East and North Africa (MENA) region and to South Africa; renewable process heat fuelled industries from Chile to Europe to India; and solar PV continued to spread across the globe, with most capacity on-grid but also significant increases in off-grid markets in developing countries. Such developments make it increasingly evident that renewables are no longer dependent upon a small handful of countries. Indeed, during 2013, major renewable energy companies further shifted their focus away from traditional markets in Europe and into Africa, Asia, and Latin America, where strong new markets are emerging in all sectors, both on and off the grid.15 Renewables have been aided by continuing advances in technologies, falling prices, and innovations in financing, driven largely by policy support. These developments are making renewable energy more economical than new fossil and nuclear installations under many circumstances, and thus more affordable for a broader range of consumers in developed and developing countries.16 In addition, there is increasing aware- ness of renewable energy technologies and resources, and their potential to help meet rapidly rising energy demand, while also creating jobs, accelerating economic development, reducing local air pollution, improving public health, and reducing carbon emissions.17 There is also a growing recognition that renewable energy can expand access to modern energy services in developing countries, both rapidly and cost effectively.18 As more attention turns to issues of energy access, as prices decline, and as new business models emerge, it is becoming apparent that rural energy markets in developing countries offer significant business opportunities, and products are being tailored specifically to meet the needs of these markets.19 (See Distributed Renewable Energy section.) Increasingly, renewable energy is considered crucial for meeting current and future energy needs. In Latin America, for example, renewables are now seen as a critical energy source.20 (See Sidebar 2.) To achieve a variety of energy security and sustainability goals, growing numbers of cities, states, and regions around the world seek to transition to 100% renewable Source: See Endnote 5 for this section.