01 GLOBAL OVERVIEW
Progress in renewables remains concentrated in the power sector, while far less growth has occurred in heating, cooling and transport.
The year 2018 saw a relatively stable market for renewable energy technologies. A total of 181 gigawatts (GW) of renewable power was added, a consistent pace compared to 2017, and the number of countries integrating high shares of variable renewable energy (VRE) keeps rising.
Progress once again was concentrated in the power sector, as renewable energy became increasingly cost-competitive compared to conventional thermal generation. Renewables provided an estimated more than 26% of global electricity generation by year’s end. Uptake has been driven by targets and stable policies. As in previous years, renewables saw far less growth in the heating, cooling and transport sectors, with progress constrained by a lack of strong policy support and by slow developments in new technologies.
Decarbonisation pathways and frameworks were developed further during 2018. At the sub-national level, a growing number of governments in many regions became leaders, setting more ambitious targets than their national counterparts. Developing and emerging economies continued to increase their deployment of renewables, and distributed renewable energy systems further helped to spread energy access to households in remote areas.
The private sector is playing a key role in driving renewable energy deployment through its procurement and investment decisions. Corporate sourcing of renewables more than doubled during 2018, and renewable energy has spread in significant amounts around the world. While global investment in renewables decreased from the previous year, developing and emerging economies again provided over half of all investment in 2018. The renewable energy sector overall employed (directly and indirectly) around 11 million people worldwide in 2018.
As of 2017, renewable energy accounted for an estimated 18.1% of total final energy consumption (TFEC). Modern renewables supplied 10.6% of TFEC, with an estimated 4.4% growth in demand compared to 2016. Opportunities continue to grow for increased use of renewable electricity in end-use sectors. Sector integration attracted the attention of policy makers, and the markets for enabling technologies (such as battery storage, heat pumps and electric vehicles) grew. However, meaningful action to directly support the interconnection of power, heating and cooling, and transport is still lacking.
Despite progress in renewables uptake, energy efficiency and energy access, the world is not on track to meet the targets of the Paris Agreement or of Sustainable Development Goal 7. Global energy-related carbon dioxide (CO2) emissions grew an estimated 1.7% in 2018 due to increased fossil fuel consumption. Global subsidies for fossil fuel use increased 11% from 2017, and fossil fuel companies continued to spend hundreds of millions of dollars on lobbying to delay, control or block climate change policies and on advertisements to influence public opinion.
Heating and Cooling
Uptake of renewables in heating and cooling remains slow due to a lack of policy support.
Modern renewable energy met around 10% of worldwide heating and cooling demand in 2016, but its growth in the sector continues to be minor. Even though heating and cooling accounted for around half of total final energy demand, policy attention in this area is still lacking. In 2018, only 47 countries had targets for renewable heating and cooling, while the number of countries with regulatory policies in the sector fell from 21 to 20.
Effective policies for the heating and cooling sector (such as building energy codes) exist mainly at a local level, and sub-national governments are beginning to acknowledge the urgency of increasing renewable energy shares in the sector. Sector integration is a key opportunity to boost renewables in buildings and industry. Policy approaches that integrate renewable energy and energy efficiency are needed both to curtail the growth in heat demand and to increase the uptake of modern renewable technologies.
TransportRenewable energy penetration in the transport sector remains low. Although biofuels dominate the renewables contribution, the market for EVs is growing significantly.
The renewable energy share of transport increased slightly from the previous year to reach 3.3%. The majority of this is provided by liquid biofuels; however, the sector is increasingly open to electrification, presenting opportunities to further integrate renewable energy. Despite increases in ethanol and biodiesel production in 2018, growth in the use of biofuels for transport remains constrained by policy uncertainties and by the slow progress in developing renewable fuels for markets such as aviation. There were some positive signs during the year from rail, aviation and maritime transport, with new targets, partnerships and initiatives to support renewables and decarbonisation.
The deployment of electric vehicles (EVs) on the world’s roads increased in 2018, driven largely by efforts to reduce air pollution. The global number of electric passenger cars increased 63% compared with 2017, and more cities are moving to electric bus fleets.
PowerRenewable energy is expanding in the power sector, with 181 GW newly installed in 2018. However, the rate of new capacity additions levelled off, following years of growth.
Global renewable power capacity totalled
Global renewable power capacity grew to around 2,378 GW in 2018. For the fourth year in a row, additions of renewable power generation capacity outpaced net installations of fossil fuel and nuclear power combined. Around 100 GW of solar photovoltaics (PV) was installed – accounting for 55% of renewable capacity additions – followed by wind power (28%) and hydropower (11%). Overall, renewable energy has grown to account for more than 33% of the world’s total installed power generating capacity.
Renewable energy has established itself on a global scale. In 2018, more than 90 countries had installed at least 1 GW of generating capacity, while at least 30 countries exceeded 10 GW of capacity. Wind power and solar PV further increased their shares in some locations, and a growing number of countries now have more than 20% variable renewables in their electricity mixes.
02 Policy Landscape
Policy frameworks are still far from the ambition level required to reach international goals. Targets are increasingly ambitious for power, but those for heating, cooling and transport lag behind.
Renewable energy support policies and targets were present in nearly all countries worldwide by the end of 2018 and are found at all levels of government. Policy makers have the opportunity to design an effective mix of support policies tailored to their respective jurisdictions. As the costs for renewable technologies fall, these measures continue to evolve and adapt. The diverse benefits of renewable energy – such as improved public health through reduced pollution, increased reliability and resilience, and job creation – are driving policy action around the world. However, renewable energy policy frameworks vary greatly in scope and comprehensiveness, and most remain far from the ambition level required to reach international climate goals.
Renewable energy targets had been adopted in
countries at the national or state/provincial level by the end of 2018.
By 2018, renewable energy targets had been adopted in 169 countries at the national or state/provincial level. New and revised targets have become increasingly ambitious, particularly in the power sector, but far fewer countries had renewable energy targets specifically for the heating, cooling and transport sectors, and targets for economy-wide energy transformation remain rare. Sub-national governments are often the first movers in establishing innovative and ambitious mechanisms, including 100% renewable energy or power targets.
Heating and Cooling
Policy coverage for renewables and energy efficiency in buildings and industry is far from global. The number of countries with heating and cooling mandates fell in 2018.
Policies supporting renewable energy uptake for heating and cooling in buildings and industry have advanced slowly, and the number of countries, states and provinces with renewable heating and cooling regulatory policies fell to just 20 in 2018. Building energy codes are a primary mechanism for promoting renewable energy generation and energy efficiency. However, less than a third of all countries worldwide had mandatory building energy codes in place for all or part of the sector, while 60% of the total energy used in buildings in 2018 occurred in jurisdictions that lacked energy efficiency policies.
is among the policy mechanisms that can stimulate interest in renewables to meet climate goals.
Europe has been one of the most fervent supporters of renewable heat technologies. In 2018, the European Union (EU) established its first binding renewable heating and cooling target to be implemented at the national level, while simultaneously working towards the region-wide goal of a decarbonised buildings sector by 2050. Cities and local governments are at the forefront of policy trends for energy use in buildings, and many of the world’s largest municipalities pledged in 2018 to reach net-zero carbon operating emissions in their buildings sector by 2050.
In contrast, renewable energy support policies focused on the industrial sector are more limited, and new or revised policies for the promotion of renewable energy in industry were scarce in 2018. Standards and targets for energy efficiency of industrial processes covered only 25% of total industrial energy use in 2016.
Biofuels are a central component of policy frameworks, although no new countries added mandates in 2018. Direct policy support linking EVs to renewables remains limited.
Policies for renewable energy in the transport sector still focus largely on road transport; however, the growing use of electricity and advanced biofuels in road transport, along with increasing efforts for decarbonisation, have encouraged support for renewables in rail, shipping and aviation as well. Biofuels have been a central component of national renewable transport policy frameworks, with blending mandates existing in 70 countries at the national or state/provincial level by the end of 2018. No new countries introduced blending mandates during the year, but some countries that had mandates in place added new ones, and several existing mandates were strengthened.
Conversely, fuel economy policies for light-duty vehicles existed in only 40 countries by year’s end and have been largely offset by trends towards larger vehicles. EVs are becoming an important component of the road transport mix, but direct policy support linking their promotion to renewable energy deployment is limited.
The use of auctions is spreading to an increasing number of countries, but FIT policies and other incentives are still important for advancing renewable power.
The power sector again received most of the renewable energy-focused policy attention in 2018. Policy makers continued to turn to competitive auctions in lieu of traditional fixed-price policies, and auctions were held in at least 48 countries (up from 29 the year before), including many in Africa. At least one of the auctions in 2018 was technology-neutral (in Brazil), while at least six were neutral for renewable technologies. China halted financial support for solar projects in favour of auctions, and a transition to auctions for wind energy projects in the country is to follow in the coming years.
Despite the shift to auctions in many countries, feed-in tariff (FIT) policies, in place in 111 jurisdictions at the national, state or provincial levels by the end of 2018, continue to play an important role. Many FITs have been revised in recent years to keep pace with changing market conditions, particularly for large-scale installations, which have seen rate reductions or the elimination of FIT support in favour of auctions. Other policies, including renewable portfolio standards, net metering and fiscal incentives, also remain key for promoting renewable energy development and deployment.
Policies to Integrate Variable Renewable Energy
Policy makers are expanding support to further integrate VRE, while encouraging sector integration and deployment of enabling technologies.
Policy makers also have focused on the development and deployment of enabling technologies to facilitate the integration of variable renewable energy. Policies to integrate VRE can address both supply and demand to increase the flexibility of the overall system. This can focus on sector integration, the deployment of technologies offering ancillary grid services, or new and emerging technologies such as battery storage. An emerging trend is policies encouraging the joint installation of renewables and energy storage systems.
Climate Policy and Renewables
Carbon pricing policies can stimulate interest in renewables to meet climate goals. Although such policies are expanding, they currently cover just 13% of global emissions.
Renewable energy technologies have received both direct and indirect support through policies targeting climate change mitigation and adaptation. Carbon taxes and emissions trading systems are among the policy mechanisms that can stimulate interest in renewables to meet climate goals. At least 54 carbon pricing initiatives had been implemented by the end of 2018 (up from 46 in 2017), including 27 emissions trading systems and 27 carbon taxes.
03 Market and Industry Trends
Modern bioenergy is the largest contributor to the global renewable energy supply.
In 2017, modern bioenergy provided an estimated 5% of global final energy consumption, nearly half of the entire contribution of renewable energy. Bioenergy made its largest contribution to the heating and cooling sector (5%), followed by the transport sector (3%) and the electricity supply (2.1%). Bioenergy use is growing most quickly in the electricity and transport sectors, while it lags in the heating sector.
In 2018, the EU maintained its lead for the use of modern bioenergy for heating, with progress driven mainly by the EU Renewable Energy Directive. China is the world leader in bioelectricity generation, followed by the United States, Brazil, India and Germany. Biofuels production is dominated by the United States and Brazil, which together produced 69% of all biofuels in 2018.
Bioenergy markets and industrial activity were driven strongly by policy, but trade patterns, especially for transport biofuels, were influenced greatly by changing import tariffs and other similar measures.
Industrial development continued to focus on the development of advanced biofuels that can offer improved sustainability performance and also be used in new applications such as aviation. Progress is being made in developing and deploying these new fuels, but so far they account for only a small share of biofuels production.
Geothermal Power and Heat
Geothermal energy is growing only gradually, and most power capacity is being added in only two countries.
Geothermal energy output in 2018 was estimated at 630 petajoules, with around half of this in the form of electricity (89.3 terawatt-hours (TWh)) and half as heat.
An estimated 0.5 GW of new geothermal power generating capacity came online in 2018, bringing the global total to around 13.3 GW. Turkey and Indonesia accounted for about two-thirds of the new capacity installed. Other additions included Croatia’s first geothermal power plant as well as projects in Iceland, Kenya, New Zealand, the Philippines and the United States. Direct extraction of geothermal energy for thermal applications grew in 2018, especially for space heating, with most apparent market activity in Europe and China.
In 2018, the global geothermal industry continued to express measured optimism for geothermal development, tempered by ongoing concerns about various industry-specific challenges as well as by the perception of insufficient or wavering government support. International agencies and development banks explored opportunities to overcome some of these challenges and to fund new development.
Hydropower is characterised by market stability, rising industry competition and a growing demand for energy storage.
The global hydropower market in 2018 looked very similar to the preceding year in terms of capacity growth and concentration of activity. An estimated 20 GW was added to reach a total installed capacity of around 1,132 GW. Worldwide generation from hydropower, which varies each year with shifts in weather patterns and other local conditions, was an estimated 4,210 TWh. As in many preceding years, China led in commissioning new hydropower capacity, representing more than 35% of new installations in 2018. Brazil came second (as in 2017), followed by Pakistan and Turkey, all adding more than 1 GW of capacity.
Pumped storage capacity increased 1.9 GW in 2018, for a year-end total of 160 GW, representing the vast majority of global energy storage capacity. New capacity was installed in China, Austria and the United States. Some new pumped storage projects are being optimised for fast response to changing grid conditions, in part to better accommodate the growing use of variable renewable power technologies.
A notable feature of the hydropower industry in 2018 was the swelling ranks of ageing facilities that require repairs and upgrades. More than half of all hydropower facilities worldwide have either already undergone, or will soon require, upgrades and modernisation. Another trend was growing recognition of the value that hydropower facilities can offer for the effective integration of variable sources of renewable energy, such as solar PV and wind power, and of the potential synergies between hydropower and other renewable energy technologies, depending on local conditions.
Certain technologies appear close to commercialisation, but consistent support policies and revenue guarantees remain critical.
Ocean power represents the smallest portion of the renewable energy market, with most projects focused on relatively small-scale demonstration and pilot projects of less than 1 megawatt (MW). Net additions in 2018 were approximately 2 MW, with an estimated 532 MW of operating capacity at year’s end.
Development activity is found around the world but is concentrated primarily in Europe, and particularly off the shores of Scotland, where several arrays of tidal turbines were being deployed in 2018. The resource potential of ocean energy is enormous, but it remains largely untapped despite decades of development efforts.
The year 2018 was one of stark contrasts for the ocean power industry. On the one hand, manufacturers of tidal turbine arrays, in particular, indicated technological success and progression towards commercialisation. On the other hand, a negative outlook prompted one prominent tidal technology developer to abandon all plans for further manufacturing and deployment. Financial and other support from governments, particularly in Europe and North America, continued to reinforce private investments in ocean power technologies, especially tidal stream and wave power devices.
Solar Photovoltaics (PV)
Solar PV had another strong year for new additions, boosted by growth in emerging markets.
The annual global market for solar PV was up slightly to exceed 100 GW (direct current) for the first time, with a year-end total of 505.5 GW. Higher demand in emerging markets and in Europe compensated for a substantial decline in China that resulted from policy changes mid-year, although Asia still eclipsed other regions for new installations.
While support schemes of some kind are still needed for solar PV in most countries, interest in purely competitive systems is growing quickly. Self-consumption remained an important driver of the market for new distributed systems in some regions, and corporate purchasing of solar PV expanded considerably, particularly in the United States and Europe. Around the world, mining, manufacturing and other industries were erecting solar PV (and other renewable) plants to power their operations.
The solar PV industry experienced significant growing pains in 2018. China’s decision to constrain domestic demand led to global turmoil as Chinese modules flooded the world market, and trade disputes affected the industry in some countries. Record-low auction prices, driven by intense competition and lower panel prices, brought further consolidation. Nonetheless, the year also saw investment in new, more-efficient production capacity and additional advances in solar PV technology.
By year’s end, at least 32 countries, representing every region, had a cumulative capacity of 1 GW or more. Solar PV played a significant and growing role in electricity generation in several countries, including Honduras (12.1%), Italy and Greece (both about 8.2%), and by late 2018 one in five Australian households generated at least some of their electricity with solar energy.
Concentrating Solar Thermal Power
New CSP additions are being installed exclusively in emerging markets, while significant new capacity is in the pipeline.
Global concentrating solar thermal power (CSP) capacity increased 11% to just under 5.5 GW in 2018. An estimated 550 MW came online, representing the largest gain since 2014. At year’s end, around 2 GW of new plants was under construction in 10 countries, with most of this capacity being built in the United Arab Emirates (0.7 GW) and China (just over 0.5 GW). All but 3 of the 23 plants under construction plan to include thermal energy storage (TES). Operational TES reached almost 17 gigawatt-hours by the end of 2018.
For the third consecutive year, new capacity came online only in emerging markets. China and Morocco led in new additions at 200 MW each, followed by South Africa and Saudi Arabia. Costs continue to decline due to wider project deployment, technological innovation and competition. On a national level, the future of CSP in South Africa is uncertain, with no new plants being allocated under the government’s latest resource plan. In China, projects under construction were estimated to be 40% cheaper than facilities elsewhere due to rapid industry growth.
Solar Thermal Heating and Cooling
Despite a decline in global installations, key markets are growing again, and additions of large-scale systems more than doubled during the year.
Approximately 33.3 gigawatts-thermal (GWth) of new solar thermal capacity was commissioned in 2018, increasing total global capacity 2% to around 480 GWth. China accounted for about 74% of global additions, followed by Turkey, Brazil and the United States. While China’s gross additions declined for the fifth consecutive year, most of the largest solar heating and cooling markets outside of China saw demand increase for the first time since 2015. This was due to several factors, including clean air policies and the improving cost-competitiveness of solar thermal systems. Furthermore, rising demand in the Middle East and in East and Central Africa allowed several southern European solar collector manufacturers to enlarge their production volumes.
Market growth also was driven by rising interest among commercial and industrial clients. At least 37 new large-scale systems were commissioned globally to provide heat for district networks or large buildings, up from 17 systems a year earlier.
The number of new solar heat for industrial processes (SHIP) installations in 2018 matched the level of 2017, with Mexico and China being the global leaders.
The year 2018 also marked a milestone for new deals for solar heat projects that use concentrating technologies. A memorandum of understanding for a world-record size 2 GWth solar steam producing plant was signed in Oman, and construction started on the first large SHIP (and large concentrating solar) plant in Brazil.
Wind power is characterised by stable installations, falling prices in a competitive industry and growing interest in offshore wind power, following successes in Europe.
The global wind market was fairly stable, with about 51 GW added in 2018, boosting cumulative capacity 9% to 591 GW. Following a record year for wind power in Europe and India in 2017, both markets contracted in 2018, but notable growth occurred in several other regions and countries. Asia was the largest regional market, representing nearly 52% of added capacity.
In the offshore segment, seven countries in Europe and two in Asia connected 4.5 GW, increasing cumulative global capacity 24% to 23.1 GW. The success of offshore wind power in Europe has sparked interest in almost every other region.
While falling prices are helping to move wind power into new markets and driving up sales, the global transition from FITs to more-competitive mechanisms, such as auctions and tenders, has resulted in intense price competition that is squeezing the entire value chain and challenging wind turbine manufacturers and developers alike. Further, wind power’s success is coming with new challenges resulting from poorly designed and executed tenders, as well as limitations of power systems and markets that were designed for centralised, large-scale fossil power.
The industry is meeting these challenges with ongoing technology advances (including larger turbines) that are increasing energy production per turbine, improving plant efficiency and output, and reducing the levelised cost of electricity (LCOE) from wind energy. At least 12 countries around the world met 10% or more of their annual electricity consumption with wind energy in 2018.
04 Distributed Renewables for Energy Access
DREA systems continue to play an important role in providing access to modern energy services to households in remote areas of developing and emerging economies.
In 2017, the global population without access to electricity fell below the 1 billion mark, with 61% of those still lacking access living in sub-Saharan Africa and around 35% in developing Asia. With regard to energy for clean cooking, 2.7 billion people still did not have access in 2017, 33% of them living in sub-Saharan Africa and 64% of them in developing Asia.
In 2017, the global population without access to electricity fell below 1 billion.
Building on the momentum of the past five years, distributed renewables for energy access (DREA) systems are increasingly being used to provide access to electricity. In 2017, more than 122 million people obtained access mainly through off-grid solar systems. While pico-solar systems dominate the off-grid solar market, the sales volume of affiliated larger solar home systems increased 77% in 2018, highlighting an increasing demand for more power.
The off-grid electricity access sector attracted a record USD 512 million of corporate-level investment in 2018, up 22% from the previous year. Start-ups involved in the off-grid solar PV sector raised USD 339 million in 2019, up 6% compared to 2017. The mini-grid sector expanded in 2018, with some 2,000 solar mini-grids in operation in Asia and about 800 in Africa. Mini-grid start-ups attracted around USD 51 million in investment, down 18% from 2017.
The market for cleani cooking solutions also grew. The clean cooking sector attracted USD 40 million of investment in 2017, up 36% from the previous year. Although the sector is yet to be scaled to the level of off-grid solar PV, various delivery models are being tested that focus on an integrated approach: sales of both the stove and the associated fuels. Companies using this integrated approach attracted around 70% of all investment in the sector in 2017.
Development finance institutions increased their support to DREA in 2018, directing some 7% of their total investment in energy projects to off-grid systems. However, finance for energy access decreased in 2018 for the second year running and remains far behind the estimated amounts needed to reach universal access to electricity and clean cooking.
i“Clean” in this section refers to clean and/or efficient cook stoves as per the methodology of the Clean Cooking Alliance. This definition of clean encompasses only the health and environment impacts of cooking as indicators, regardless of the type of stoves/fuels being used (for example, liquefied petroleum gas (LPG) is counted alongside modern renewable fuels, and LPG cook stoves continue to make up the majority of clean cook stoves on the market)i
05 Investment flows
Global investment fell, driven by a sharp decline in China. For the fourth year running, investment in developing and emerging countries exceeded that of developed countries.
Global new investment in renewable power and fuels (not including hydropower projects larger than 50 MW) was USD 288.9 billion in 2018ii. This represents a decrease of 11% compared to the previous year. Investment in renewable power and fuels has exceeded USD 280 billion per year for the past five years. Including investments in hydropower projects larger than 50 MW, total new investment in renewable power and fuels was at least USD 304.9 billion in 2018.
Dollar investment in new renewable power capacity (including all hydropower) once again far exceeded that invested in fossil and nuclear power capacity in 2018. Investment in renewable energy continued to focus on solar power, particularly solar PV, which secured USD 139.7 billion during the year. Asset finance of utility-scaleiii projects, such as wind farms and solar parks, dominated investment at USD 236.5 billion. Small-scale solar PV installations (less than 1 MW) accounted for USD 36.3 billion worldwide, a decrease of 15%.
Developing and emerging economies overtook developed countries in renewable energy investment for the first time in 2015. After extending their lead in 2017, they retained it in 2018, albeit by a smaller amount. Investment in developing and emerging countries decreased 25% to USD 152.8 billion (due largely to decreases in China), while that in developed countries increased 11% to USD 136.1 billion.
Developments in renewable energy investment varied by region, rising in Europe, in Africa and the Middle East, in Asia (except China and India) and in the United States, and falling in the Americas (excluding the United States but including Brazil), China and India. Considering all financing of renewable energy (but excluding hydropower larger than 50 MW), China accounted for 32% of the global total, down from 45% in 2017. China was followed by Europe (21%), the United States (17%) and Asia-Oceania (excluding China and India; 15%). Smaller shares were seen in India (5%), Africa and the Middle East (5%), the Americas (excluding Brazil and the United States, 3%) and Brazil (1%).
iiInvestment-related data do not include hydropower projects larger than 50 MW, except where specified.ii
iii“Utility-scale” here refers to wind farms, solar parks and other renewable power installations of 1 MW or more in size, and to biofuel production facilities with capacity exceeding 1 million litres.iii
06 ENERGY Systems Integration and Enabling Technologies
Strong growth in VRE is being managed in power systems around the world, while markets for energy storage, heat pumps and EVs expanded further.
Rising shares of renewable energy continue to transform energy systems around the world. In recent years, many countries have seen significant growth in installed capacity and generation from sources of variable renewable energy. In 2018, at least nine countries supplied more than 20% of their electricity generation from VRE, while some countries have seen rapid annual growth of VRE penetration.
Power systems are adapting to rising shares of VRE through a range of measures. Countries and sub-national entities are linking electricity systems across large regions in part to address the issues of curtailment and localised variability. Other strategies include system-level design of operations, regulations and markets; grid enhancements; and boosting flexibility in energy demand and supply.
Countries are managing growing shares of variable renewables through a range of measures.
Certain technologies – such as energy storage, heat pumps and EVs – can help integrate higher shares of VRE in the power sector by unlocking new sources of flexibility. In addition, these technologies can provide new sources of demand in heating and transport, allowing for further increases in the supply of renewables to these sectors. Some of these technologies are already widely deployed, while others are still emerging but experienced rapid growth in 2018.
Energy storage can enable higher penetration of VRE by improving system flexibility, reducing curtailment and minimising costs. Pumped hydropower storage, the largest contributor to the global energy storage stock, added 1.9 GW in 2018 to reach 160 GW. Global battery storage capacity totalled just over 3 GW in early 2019, with nearly 80% of new additions concentrated in five countries. Behind-the-meter battery storage also grew, and direct coupling of batteries with VRE generation continued to increase, especially with solar PV.
Heat pump markets expanded during the year. China maintained its lead in the global market for heat pumps, while the European market increased 12% in 2018, marking several years of strong growth. Large heat pumps are being deployed in district heating and cooling applications where the technologies can offer a significant flexibility resource to power systems. In the industry, several mergers took place as manufacturers looked to expand product lines and move into new markets.
EVs support the integration of VRE by presenting an opportunity for demand-side management. The global stock of electric cars reached more than 5.1 million units in 2018, a 63% increase over 2017. However, EV markets remain highly concentrated, with China making up nearly 50% of the global EV stock. The first specific use of VRE to charge EVs was piloted in California in 2018. Globally, more than 100,000 public EV charging points were installed in 2018. Manufacturers invested in bi-directional charging, continuing to advance the linkages between EVs and VRE.
07 Energy Efficiency
Global energy intensity continues to fall, and an integrated approach for renewables and energy efficiency remains crucial.
International efforts to map trajectories towards the achievement of sustainable development goals generally acknowledge the complementarity of renewable energy deployment and energy efficiency measures. Government policy support – which is instrumental in improving energy efficiency in buildings, industry and transport – has become stronger in recent years, albeit with more focus on action plans and targets than specific national mandates. Cities play an increasingly prominent role in designing and implementing policies for energy efficiency.
All regions of the world have shown some improvement in the energy intensity of their economic activity in recent years, with a global average rate of decline at around 2.2% between 2012 and 2017. During this period, the global economy grew almost three times faster than primary energy demand.
In some mature economies, growth in total energy demand has long since levelled off and even begun to retract. However, despite the ongoing advances in energy efficiency in many countries and across various end-use sectors, total energy demand is still rising in regions with rapid economic growth and improved access to energy.
In buildings, total energy demand has increased despite energy efficiency improvements, due primarily to increasing population and incomes. Global energy demand for cooling has grown more rapidly than any other end-use in buildings. Energy demand for transport also rose significantly during 2012-2017 and has far exceeded the effect of greater vehicle efficiency. Energy demand of industry has grown only half as fast as industrial activity in recent years, mitigated by structural changes as well as greater energy efficiency.
08 Feature: Renewables in Cities
Cities are taking a leading role in advancing renewable energy through their efforts to achieve a wide range of interlinked environmental, economic and social goals.
Cities are at the forefront of the energy transition, accounting for around 65% of global energy demand and home to more than half the world’s people. Some cities are able to accomplish more ambitious renewables goals than national and state/provincial bodies, as they can tap into their direct responsibility for providing services for residents and ensuring day-to-day quality of life, their contractual relationships with energy providers and large-scale users, and their authority to create incentives that drive lifestyle and development choices at the local level.
Cities are taking a leading role in advancing renewable energy through their efforts to achieve a wide range of interlinked environmental, economic and social goals, including reducing air pollution, creating local jobs, improving energy access, and enhancing energy security and governance. Renewables have the potential to achieve all of these objectives, and most cities pursue renewable energy for more than one of these reasons.
Building on these multiple drivers, cities are advancing renewable energy as a means to provide urban services such as electricity, heating and cooling, and transport. They also are developing cross-sectoral approaches, for example using urban waste and wastewater streams to produce biogas, biomethane and other renewable energy sources.
worldwide had adopted targets for 100% renewables in at least one sector by the end of 2018.
Cities are adopting some of the world’s most ambitious targets for renewables. By the end of 2018, more than 230 cities worldwide had adopted targets for 100% renewable energy in at least one sector, and more than 50 cities had set comprehensive renewables targets covering the power, heating and cooling, and transport sectors. Climate action at the city level has contributed to national-level commitments to climate mitigation and adaption, as well as to reduce greenhouse gas emissions.
Despite the importance of cities in the energy transition, data on local- and city-level renewable energy policies and achievements are decentralised; consolidated data are limited; and the data that are available often are outdated.
To fill in some of the data gaps and to showcase the many trends and developments related to renewables at the local level, REN21 is producing a new report series, the Renewables in Cities Global Status Report (REC-GSR).