01 GLOBAL OVERVIEW

Renewables grew rapidly in the power sector, while far fewer advances have occurred in heating and transport.

Renewable energy had another record-breaking year in 2019i, as installed power capacity grew more than 200 gigawatts (GW) – its largest increase ever. Capacity installations and investment continued to spread to all corners of the world, and distributed renewable energy systems provided additional households in developing and emerging countries with access to electricity and clean cooking services. Also during the year, the private sector signed power purchase agreements (PPAs) for a record amount of renewable power capacity, driven mainly by ongoing cost reductions in some technologies.

Shares of renewables in electricity generation continued to rise around the world. In some countries, the share of renewables in heating, cooling and transport also grew, although these sectors continued to lag far behind due to insufficient policy support and slow developments in new technologies. This resulted in only a moderate increase in the overall share of renewables in total final energy consumption (TFEC), despite significant progress in the power sector.

As of 2018, modern renewable energy (excluding the traditional use of biomass) accounted for an estimated 11% of TFEC, only a slight increase from 9.6% in 2013. The highest share of renewable energy use (26.4%) was in electrical uses excluding heating, cooling and transport; however, these end-uses accounted for only 17% of TFEC in 2017. Energy use for transport represented some 32% of TFEC and had a low share of renewables (3.3%), while the remaining thermal energy uses accounted for more than half of TFEC, of which 10.1% was supplied by renewables. Overall, the slow growth in the renewable energy share of TFEC indicated the complementary roles of energy efficiency and renewables in reducing the contribution of fossil fuels in meeting global energy needs.

Among the general public, support for renewable energy continued to advance alongside rising awareness of the multiple benefits of renewables, including reduction of carbon dioxide (CO2) and other greenhouse gas emissions.

Governments around the world have stepped up their climate ambitions, and by year’s end 1,480 jurisdictions – spanning 28 countries and covering 820 million citizens – had issued “climate emergency” declarations, many of which were accompanied by plans and targets to transition to more renewable-based energy systems.

At the same time, while some countries were phasing out coal, others continued to invest in new coal-fired power plants, both domestically and abroad. In addition, funding from private banks for fossil fuel projects has increased each year since the signing of the Paris Agreement in 2015, totalling USD 2.7 trillion between 2016 and 2019. Although energy-related CO2 emissions remained stable in 2019, the world is not on track to limit global warming to well below 2 degrees Celsius (°C), let alone 1.5 °C, as stipulated in the Paris Agreement.

BUILDINGS

Renewables were the fastest growing energy source in buildings, yet this increase was limited by lack of policy support.

Although renewable electricity saw strong growth, it was not enough to account for global increases in

final energy demand.

Renewable energy met less than 14% of total energy demand in buildings in 2017. More than three-quarters of global final energy demand in buildings was for heating and cooling end-uses, which remain heavily fossil-fuel based. In 2018, renewables contributed an estimated 10.1% of heating and cooling demand in buildings; this share has barely risen from 8% in 2010. Modern bioenergy still represented the largest renewable heat source in the buildings sector, followed by renewable electricity for heat, solar thermal and geothermal heat. Most of the share increase was due to growth in renewable electricity for heat and in solar thermal, while use of modern bioenergy has remained stable. The majority of renewable electricity in buildings was provided by utility-scale, grid-connected renewables with a growing share from rooftop solar photovoltaic (PV) systems.

Direct policy action to stimulate renewable energy uptake in buildings was lacking in 2019, although more local and national governments introduced bans on fossil fuels for heating. Global efforts to decarbonise buildings through net zero carbon / net zero energy buildings are promoting the uptake of renewable energy in the sector.

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INDUSTRY

The share of renewables in industrial energy use remains small, particularly in sectors that require high process temperatures.

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Renewable energy met around 14.5% of industrial final energy demand, with bioenergy supplying more than half of the renewable share. Bioenergy was used primarily in sub-sectors that utilise low-temperature heat (below 100 °C), such as pulp and paper. Solar thermal and geothermal heat were used mainly for pre-heating water, drying and generating low-temperature steam in industries such as mining, food and beverage production, textiles and agriculture. Within the industrial sector, the most energy-intensive sub-sectors – those with the highest process temperatures – also use the lowest shares of renewable energy.

Renewable electricity was used to supply both electrical and thermal demands of some industrial processes. New projects were completed or announced in 2019 to use renewable electricity to produce steel and cement and to power mining operations. In addition, projects were commissioned to produce renewable hydrogen for industry, and companies announced plans and intentions to produce renewable hydrogen from offshore wind power.

TRANSPORT

Despite gains in energy efficiency and continued growth in both biofuels and electric vehicles (EVs), transport remains the sector with the lowest share of renewable energy.

Although it accounts for around one-third of TFEC, transport remained the sector with the lowest share of renewable energy, at only 3.3%. The vast majority of global transport energy needs were met by oil and petroleum products, with small shares met by biofuels and renewable electricity. Gains in energy efficiency and continued growth in both biofuels and EVs were largely offset by rising energy demand in transport. Biofuels remained by far the largest contributor of renewable energy to the transport sector in 2019.

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Although rarely linked directly to renewable sources, EVs became more commonplace in more countries as a result of policies and targets adopted in prior years. With cities increasingly restricting the circulation of fossil fuel vehicles, new mobility service companies have expanded rapidly, with some committing to using renewable electricity in their EV fleets. Some regions also saw gradual increases in the use of renewable hydrogen and renewable synthetic fuels for transport, but these remained minimal overall. Many countries still lack a holistic strategy for decarbonising transport. Although positive developments occurred across transport modes, including in road freight, shipping and aviation in 2019, progress has been too slow to achieve global climate targets.

POWER

The renewable power sector experienced record-high increases in installed capacity, outpacing net installations in fossil fuel and nuclear power combined.

Installed renewable power capacity grew more than 200 GW in 2019 (mostly solar PV), the largest increase ever. For the fifth year in a row, net additions of renewable power generation capacity clearly outpaced net installations of fossil fuel and nuclear power capacity combined. Globally, 32 countries had at least 10 GW of renewable power capacity in 2019, up from only 19 countries a decade earlier. In most countries, producing electricity from wind and solar PV is now more cost effective than generating it from new coal-fired power plants. These cost declines have led to record-low bids in tendering processes, which became even more common during the year. However, competitive auctions have led to consolidation in some industries and have favoured larger multinational energy companies rather than smaller actors, including community-led groups.

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Overall, installed renewable energy capacity was enough to provide an estimated 27.3% of global electricity generation by the end of 2019. Despite these advances, renewable electricity continued to face challenges in achieving a larger share of global electricity generation, due in part to persistent investment in fossil fuel (and nuclear) power capacity.

iThe Renewables 2020 Global Status Report focuses on developments in renewable energy in 2019, and therefore does not reflect the impact of the COVID-19 pandemic on global energy systems. For immediate impacts on the renewable energy sector as of mid-2020, see Sidebar 1. An overview of the full impacts of the COVID-19 crisis on the sector will be included in GSR 2021.i

02 POLICY LANDSCAPE

In 2019, policy frameworks continued to evolve in response to changes in renewable energy technologies and markets.

Much of the progress in developing and deploying renewable energy technologies has been achieved thanks to effective government policies. Policy continues to be important to overcome economic, technical and institutional barriers. By the end of 2019, nearly all countries had renewable energy support policies in place, although with varying degrees of ambition, scope and comprehensiveness. Jurisdictions have adapted policies to meet their specific circumstances, including to support increasing renewable energy capacity and generation, to boost job creation, and to increase energy access and security. Trade policy also had an impact on the production, exchange and development of renewable energy products, as well as on renewable energy demand levels within specific countries.

CROSS-SECTORAL TARGETS AND POLICIES

Targets that align renewable energy policy across multiple levels of governance and multiple economic sectors remained rare in 2019.

Renewable energy policies typically are enacted at a single level of governance and tend to focus on a single end-use sector, although examples of integration and co-ordination are emerging. Co-ordinated policy efforts often are organised under energy or climate change strategies at the national or state/provincial level, such as those introduced in the Netherlands and Scotland during 2019.

Targets are a primary means of expressing commitment to renewable energy and have been aimed almost exclusively at the power (electricity) sector. By the end of 2019, 166 countries had renewable power targets, compared to 49 countries for heating and cooling and 46 for transport. Only one cross-sectoral target was adopted during 2019, in Spain.

RENEWABLE ENERGY AND CLIMATE CHANGE POLICY

Climate change policies that directly or indirectly stimulate interest in renewables increased in 2019, spreading to new regions and reaching new levels of ambition.

In some jurisdictions, policies directly link climate change mitigation with the increased deployment of renewables – such as Costa Rica’s economy-wide roadmap launched in 2019 to achieve net zero emissions by 2050. However, other climate policies – such as fossil fuel bans and phase-outs, greenhouse gas emissions targets, and carbon pricing and emissions trading systems – stimulate the uptake of renewables indirectly. By the end of 2019, at least 56 carbon pricing initiatives in 47 countries had been implemented (up from 54 initiatives in 45 countries in 2018, with the addition of Singapore and South Africa). Fourteen countries worldwide had a legally binding target for net zero emissions (while two countries have already achieved this target), and the European Commission proposed a European Green Deal to create the first carbon-neutral continent by 2050.

HEATING AND COOLING POLICY

Despite the enormous potential for renewable energy in heating and cooling, the number of related policies for buildings increased only slightly, while such policies for industry remained scarce.

Effective policy support

has been key to the advancement of renewables in power, while heating and transport lag behind.

Policies supporting renewable heating and cooling in buildings grew minimally in 2019, and include renewable heating and cooling mandates, building energy codes, support for renewable district heating and cooling, support for renewable natural gas, financial incentives, net zero emissions standards and fossil fuel bans for heating. No new countries adopted renewable heat mandates for the second year in a row, but at least four countries (Austria, Denmark, Norway and the United Kingdom) adopted targets to fully or partially ban the use of fossil fuels in heating.

Renewable energy support policies for the industrial sector are more limited, and new or revised policies in this area remained scarce in 2019. Although not always specific to the industrial sector, some policy developments related to renewable hydrogen took place in 2019, particularly in Australia, New Zealand, and Europe, while policy focus on hydrogen elsewhere occurred without a direct link to renewables.

TRANSPORT POLICY

In the transport sector, no new countries adopted biofuel blend mandates, but some countries with existing mandates strengthened their policies. Policy attention to EVs expanded but still without a direct link to renewables.

In 2019, policies to promote renewable energy in the transport sector continued to focus primarily on road transport, which accounts for the vast majority of energy use in transport. Rail, aviation and shipping received less policy attention despite being large energy consumers.

As in previous years, biofuels were the primary focus of road transport policy frameworks. Although no new countries introduced biofuel blending mandates for the second year running (with the total remaining at 70 countries), some countries with existing mandates added new ones, and several existing mandates were strengthened. The number of countries with targets for advanced biofuels reached 24, although nearly all were targeting shares in the single digits.

Policies aimed at the electrification of transport, while not renewable energy policies in themselves, offer the potential for greater penetration of renewable electricity in the transport sector. In 2019, numerous jurisdictions implemented policies to support the increased uptake of electric road vehicles – including targets, financial incentives, public procurement and support for charging infrastructure. Targeted bans on fossil fuel vehicles were in place in at least 18 countries, up from 12 in 2018. Austria remained the only country that had a policy directly linking renewables with EVs, while only three cities had e-mobility targets that were directly linked to a renewable electricity target.

The private sector also advanced renewable energy initiatives in the transport sector, particularly for aviation, shipping and rail.

POWER POLICY

Countries continued to turn to competitive auctions and tenders to support large-scale, centralised renewable power projects; however, rising attention was paid to decentralised systems.

The power sector continued to receive the bulk of renewable energy policy attention in 2019, and targets remained the most popular form of intervention. Many countries used competitive auctions and tenders in lieu of feed-in policies for large-scale, centralised projects. At least 68 renewable energy auctions or tenders were held across at least 41 countries at the national or state/provincial level, down from 48 countries in 2018. However, the total number of countries that have used this mechanism increased to 109 (up from 98 in 2018) as new countries held tenders for the first time. African countries were very active in 2019, although to a lesser degree than in 2018. Feed-in policies were in place in 113 jurisdictions by the end of 2019, with no change from 2018.

The uptake of policies targeting small-scale, distributed renewable power generation accelerated during the year. These policies include solar mandates, feed-in pricing, net metering (and virtual net metering) and public utility policy. Policies also were adopted to encourage community energy arrangements, including measures promoting community choice aggregation and shared ownership of renewables, especially in Europe and the United States.

The private sector engaged in various forms of renewable power procurement, including through PPAs, renewable energy certificates, utility-led procurement programmes and self-generation.

Policies for Systems Integration of Variable Renewable Electricity

A growing number of jurisdictions directed policies towards ensuring greater integration of variable renewable electricity (VRE).

The policy push for systems integration of renewables and enabling technologies, such as energy storage, remained focused on increasing power system flexibility and control, as well as grid resilience. Policies to advance the integration of VRE in 2019 were related mainly to market design, demand-side management, transmission and distribution system enhancements, grid interconnections and support for energy storage. Much of the policy development occurred in Europe and at the state level in the United States.

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03 MARKET AND INDUSTRY TRENDS

BIOENERGY

Modern bioenergy provided 5.1% of total global final energy demand in 2018, accounting for around half of all renewable energy in final energy consumption.

Global biofuels production

increased

5%

in 2019.

The contribution of modern bioenergy to heat in industry has grown about 2% in recent years, while its use for heating in buildings (mainly in Europe and North America) has fallen slightly. Bioenergy provides around 9% of industrial heat demand and is concentrated in bio-based industries such as paper and board. Biofuels, mostly ethanol and biodiesel, provide around 3% of transport energy, and global biofuels production increased 5% in 2019. Ethanol production grew around 2%, despite a decline in the United States, the major ethanol producer. Biodiesel production increased 13%, and Indonesia became the world’s largest producer, overtaking the United States, where production declined some 7%.

In the electricity sector, bioenergy’s contribution rose 9% in 2019, to 501 terawatt-hours (TWh). China extended its lead as the largest country producer, and bio-electricity growth also was strong in the EU, Japan and the Republic of Korea.

Notable trends in the bioenergy industry included the continuing rise in wood pellet production, especially to serve growing markets in Japan and the Republic of Korea, and increasing investment in hydrotreated vegetable oil (HVO) production. Production of HVO/HEFA (hydroprocessed esters and fatty acids) increased 12% in 2019, and investments in numerous additional plants were announced.

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GEOTHERMAL POWER AND HEAT

Geothermal electricity generation in 2019 totalled around 95 TWh, while direct useful thermal output reached around 117 TWh (421 petajoules).

An estimated 0.7 GW of new geothermal power generating capacity came online in 2019, bringing the global total to around 13.9 GW. As in 2018, Turkey and Indonesia led for new installations, followed closely by Kenya; together the three countries represented three-quarters of new installations globally. Other countries that added new geothermal power facilities (or added capacity at existing facilities) were Costa Rica, Japan, Mexico, the United States and Germany.

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Direct use of geothermal energy for thermal applications has grown nearly 8% on average in recent years, with the fastest growing segment being space heating (around 13% annual growth). Among the most active markets are regions of Europe and China, the latter showing the fastest expansion. Just four countries – China, Turkey, Iceland and Japan – represented roughly 75% of all geothermal direct use in 2019.

As in many previous years, the global geothermal industry had mixed results. Construction activity and anticipation of further development remained intact in some key markets, but was largely predicated on government support. Elsewhere, the industry was inhibited by industry-specific challenges of high project costs and front-loaded project risks and by the corresponding lack of adequate funding and risk mitigation.

Continued research into new technologies and innovative processes and techniques, often supported by government programmes, helped fuel optimism for a path forward.

HYDROPOWER

The global hydropower market, as measured in annual capacity installations, contracted in 2019, continuing a multi-year trend of deceleration.

New capacity totalled an estimated 15.6 GW, raising the global installed capacity to around 1,150 GW in 2019. Hydropower generation increased 2.3% during the year 2019 to an estimated 4,306 TWh, reflecting not only increased capacity but also significant localised variability from shifting weather patterns and other operational conditions.

Brazil led in commissioning new hydropower capacity in 2019, followed by four Asian countries: China, Lao PDR, Bhutan and Tajikistan. This marked the first year since at least 2004 that China did not maintain a wide-margin lead over all other countries for new hydropower completions.

Pumped storage capacity grew minimally in 2019 (0.2%), with most of the increase being a single 300 megawatt (MW) facility completed in China. Total installed capacity at year’s end was 158 GW. However, significant new capacity was being planned or under construction, in part to support growth in VRE from solar PV and wind power.

The hydropower industry continued to face a wide, interconnected, and evolving web of challenges and opportunities in a world of changing energy systems and priorities. Some are specific to the technical workings and economic considerations of the industry itself (such as the need for modernisation and climate resilience), while others pertain to hydropower’s relationship with other renewable energy sources (such as integration of VRE), as well as other environmental, social, climate and sustainability imperatives.

OCEAN POWER

Ocean power represented the smallest portion of the renewable energy market, and most deployments to date have been small-scale demonstration and pilot projects.

Despite the slow developments in the sector, the ocean power industry began moving towards semi-permanent installations and arrays of devices. The resource potential of ocean energy is enormous, but the development trajectory of ocean power technologies has been volatile, and these resources remain largely untapped.

Following a turbulent 2018, the ocean power industry regrouped in 2019 and continued its gradual advance towards commercialisation. Net additions in 2019 were around 3 MW, with an estimated 535 MW of operating capacity at year’s end. Significant investments and deployments were planned for 2020 and beyond.

Ocean power development has been concentrated mainly in Europe, where tidal stream devices generated 15 gigawatt-hours (GWh) in 2019 (up 50% from 2018). However, ocean power was gaining momentum in Canada, the United States and China, which offer generous revenue support and ambitious research and development (R&D) programmes.

SOLAR PHOTOVOLTAICS (PV)

Following a year of stable demand, the solar PV market increased 12% in 2019 to a record 115 GW (direct current), for a total of 627 GW.

The decade ended with strong demand in Europe, the United States and emerging markets around the world, more than making up for a substantial decline in China. Not including China, the global market grew around 44%. China continued to dominate the world market as well as manufacturing, having a significant influence on both.

In most countries, the need still exists for support schemes for solar PV, as well as for adequate regulatory frameworks and policies governing grid connections. Even so, interest in purely competitive large-scale systems is growing quickly, with a number of projects under construction. Corporate purchasing expanded considerably in 2019, and self-consumption (increasingly with battery storage) was an important driver for new distributed systems in several countries, including Australia and Germany.

The industry continued to face relentless competition that, coupled with policy vagaries and uncertainty, prompted cut-throat bids at some auctions and resulted in thin margins for some developers and manufacturers, contributing to ongoing consolidation. At the same time, competition drove declining prices, opening new markets, while the pressure of lower prices and expectations of rising global demand encouraged expanded and more efficient manufacturing, the entry of new companies into the sector and ongoing pursuit of innovation.

During the year, solar PV accounted for around 10.7% of total generation in Honduras and substantial shares also in Italy (8.6%), Greece (8.3%), Germany (8.2%), Chile (8.1%) and elsewhere. By year’s end, enough capacity was in operation worldwide to produce an estimated 2.8% of global electricity generation.

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CONCENTRATING SOLAR THERMAL POWER (CSP)

Global CSP capacity in operation grew exclusively in emerging markets.

Global CSP capacity grew 11% in 2019 to 6.2 GW, with 600 MW of capacity coming online. Although this was well below the average annual increase (24%) of the past decade, CSP continued to spread to new markets, including France, Israel and Kuwait. China and South Africa also brought new plants into service. For the first time, as much tower capacity as parabolic trough capacity was completed during 2019.

At year’s end, an estimated 21 GWh of thermal energy storage (TES) was operating in conjunction with CSP plants across five continents. Nearly all commercial CSP under construction – located in Asia, the Middle East and Latin America – will include TES.

The CSP industry has become more geographically diverse, both in the locations of commercial plants and in the origins of developers, investors and contractors. Levelised costs of energy from CSP continued to decline during 2018 and 2019, with CSP increasingly being built alongside both solar PV and wind power to lower costs and increase capacity value. R&D activities during the year focused on further improving CSP economics and on addressing environmental impacts.

SOLAR THERMAL HEATING AND COOLING

Solar thermal capacity reached 479 gigawatts-thermal in 2019, with China accounting for 69% of the total.

For the first time, cumulative global capacity declined (1%) compared with the previous year, because installations in China did not cover the country’s need for replacements. Additions in the other largest markets for solar heating and cooling remained stable, with noteworthy growth in Brazil, Cyprus, Denmark, Greece, South Africa and Tunisia balancing declines in Australia, Austria, Germany, Israel, Italy, Poland and Switzerland.

The year was bright for solar district heating in Denmark, China and Germany, with 24 systems (totalling 196 megawatts-thermal, MWth) newly commissioned. Successful development also generated interest elsewhere in Europe.

Record-high capacity additions of solar heat for industrial processes (SHIP), totalling 251 MWth, also occurred during the year, led by Oman, China and Mexico. Parabolic trough collectors dominated new installations, and by year's end at least 817 SHIP systems (a cumulative total of more than 700 MWth) were supplying process heat to factories worldwide. To reduce project development times and costs, system suppliers created mutually beneficial partnerships with conventional energy technology providers and with third-party financers.

The ongoing transition from small residential systems to large commercial and industrial plants resulted in consolidation among collector manufacturers, as large players gained market share through contracts for large fields or high numbers of systems.

WIND POWER

The global wind power market saw its second largest annual increase, with offshore wind accounting for a record 10% of new installations.

The global wind power market expanded 19% in 2019 to 60 GW, the second largest annual increase, for a total of 650 GW (621 GW onshore and the rest offshore). The rapid growth was due largely to surges in China and the United States in advance of policy changes and to a significant increase in Europe, despite continued market contraction in Germany. New wind farms reached full operation in at least 55 countries, and by year’s end at least 102 countries had some level of commercial wind power capacity.

While falling prices are opening new markets, the global transition to auctions and tenders has resulted in intense price competition. Poorly designed tenders, permitting delays and lack of available land and grid access are challenging wind developers in many countries and causing attrition among turbine manufacturers. The industry is working to meet new challenges with improved technologies and other advances to further reduce costs and better integrate wind energy into existing energy systems.

Offshore wind power is playing an increasingly important role and accounted for a record 10% of 2019 installations. Interest in hybrid projects, combining wind power with solar and/or energy storage, is increasing to reduce energy prices while mitigating impacts of variability and expanding revenue opportunities.

Wind energy accounted for an estimated 57% of Denmark’s electricity generation in 2019, with high shares also in Ireland (32%), Uruguay (29.5%), Portugal (26.4%) and several other countries. Capacity in operation worldwide at year's end was enough to provide an estimated 5.9% of global generation.

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04 DISTRIBUTED RENEWABLES FOR ENERGY ACCESS (DREA)

DREA systems have become an effective, established solution for providing energy access, and benefited some 150 million people around the world in 2019.

Worldwide, the number of people lacking access to electricity dropped to 860 million (11% of the global population) in 2018, and an estimated 2.65 billion people (35% of the global population) were living without clean cooking facilities that year. DREA systems are present in both urban and rural areas of the developing world and provide a wide range of services, including for lighting, appliances, cooking, space heating and cooling, and productive uses. They represent a key solution for fulfilling modern energy needs and enabling the livelihoods of hundreds of millions of people who still lack access to electricity or clean cooking solutions.

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Since 2010, more than 180 million off-grid solar systems have been sold, including 150 million pico solar products and 30 million solar home systems. The market for off-grid solar systems grew 13% in 2019 – the highest growth of the past five years – with sales totalling some 35 million units, up from 31 million units in 2018. In addition, renewable energy (mostly hydropower) supplied, either entirely or partially, around half of the 19,000 mini-grids installed worldwide by the end of 2019. Solar PV and solar hybrid mini-grids continued to gain momentum as more projects were developed across Africa and Asia.

Biomass cook stoves, biogas and solar cookers, and electric stoves were being deployed and piloted in many developing countries. An estimated 125 million people worldwide used biogas for cooking in 2018, and by the end of 2019 more than 3.9 million solar cookers were estimated to have been distributed, providing clean cooking solutions to around 14 million people.

Corporate-level investments in the DREA sector totalled around USD 468 million in 2019, down 8.5% from 2018. At the same time, capital flows in mini-grid start-ups surged 126% to a record USD 113 million. Development finance institutions, international organisations, philanthropic foundations and non-state actors provided significant support to the DREA sector in many countries by addressing policy barriers, enhancing the enabling framework, and offering technical assistance and financing to governments and companies.

05 INVESTMENT FLOWS

Global investment in renewable energy capacity remained nearly flat in 2019, although more capacity was financed due to continuous falling capital costs.

Global new investment in renewable power and fuels (not including hydropower projects larger than 50 MW) totalled USD 301.7 billion in 2019, up 5% from 2018. Including investments in hydropower projects larger than 50 MW, total new investment in renewable power and fuels was at least USD 316.7 billion. Global investment in renewable energy capacity has exceeded the USD 200 billion mark every year since 2010, reaching USD 282 billion in 2019.

Dollar investment in new renewable power capacity (including all hydropower) again far exceeded investment in coal, natural gas and nuclear power capacity in 2019, accounting for 75% of the total committed to new power generating capacity. Investment in renewables continued to focus on wind and solar power, with wind power outweighing solar PV for the first time since 2010. Asset finance of utility-scale projects, such as wind farms and solar parks, secured USD 230.1 billion during 2019. Investment in small-scale solar PV installations (less than 1 MW) increased 43.5% to USD 52.1 billion worldwide.

Developing and emerging economies outweighed developed countries in renewable energy capacity investment for the

fifth year running

Developing and emerging economies outweighed developed countries in renewable energy capacity investment for the fifth year running, reaching USD 152 billion. Although capacity investment declined in both China and India, outside these two countries it rose 17% in developing countries to a record USD 59.5 billion. In parallel, renewable energy capacity investments in developed countries increased 2% to USD 130 billion.

Renewable energy investment varied by region, rising in the Americas, including the United States and Brazil, but falling in all other world regions including China, Europe, India, and the Middle East and Africa. Considering all financing of renewable energy capacity (but excluding hydropower larger than 50 MW), China again had the largest share (30%), followed by the United States (20%), Europe (19%) and Asia-Oceania (16%; excluding China and India). Smaller shares were seen in Africa and the Middle East (5%), the Americas (excluding Brazil and the United States, 4%), India (3%) and Brazil (2%).

06 ENERGY systems INTEGRATION AND ENABLING TECHNOLOGIES

Countries integrated more solar PV and wind power than ever through a range of measures, supported by expanding markets for heat pumps, EVs and energy storage.

Growth in renewable energy is transforming energy systems around the world. In the power sector in particular, rapid growth in the installed capacity and penetration of variable renewable electricity sources – such as solar PV and wind power – has occurred in many countries. In 2019, VRE produced an estimated 8.7% of global electricity, while all renewables met 27.3% of global generation.

Improving power system flexibility is central to advancing the integration of VRE. Power system flexibility is being enhanced through: strategic market design that rewards or promotes flexibility; direct procurement of flexibility services from sources of generation, demand and energy storage; improved forecasting of electricity demand and of VRE generation and demand; and the improvement of grid infrastructure to support VRE uptake.

Several technologies are supporting the integration of renewables by enabling greater flexibility in energy systems or by promoting the linking of energy supply and demand across electricity, thermal and transport applications. These include mature or commercialised technologies such as heat pumps, EVs and certain types of energy storage, and emerging energy storage technologies including renewable hydrogen.

The heat pump market has grown rapidly in recent years, driven largely by rising demand for cooling in emerging economies and by strong sales of reversible air conditioning units used for both cooling and heating. Notable activity in 2019 included investments by large technology companies in specialised heat pump firms, a focus on incremental cost and efficiency improvements, and the integration of heat pumps alongside renewables and energy storage using digital technologies.

The global stock of electric cars (passenger EVs) grew more than 40% in 2019, up more than 2 million from 2018. However, growth was lower than in 2018, when the global stock jumped 63% from the previous year. The global stock of two- and three-wheeled EVs reached some 251 million in 2019, while sales of electric buses declined for the fourth consecutive year. The EV industry in 2019 was characterised by diverse commitments and investments from both dedicated EV manufacturers and traditional automakers. VRE was increasingly available on EV charging networks.

The global market for energy storage of all types reached 183 GW in 2019. Around 0.3 GW of pumped (hydropower) storage was added in 2019, while the leading markets for battery storage had mixed results. Renewables-plus-storage has emerged as a major driver of battery market growth. The energy storage industry saw significant cost improvements, increased manufacturing capacity, large investments and ongoing R&D during 2019, with many of these activities focused on short-duration storage applications and battery technologies.

07 ENERGY EFFICIENCY AND RENEWABLES

Global energy intensity has continued to fall in recent years, and an integrated approach for advancing both renewables and energy efficiency remains crucial.

International efforts to meet energy demand in a safe and reliable manner generally acknowledge the complementary nature of renewable energy deployment and energy efficiency measures. Both renewables and efficiency can contribute significant benefits including lower energy costs on a national, corporate or household level, increased grid reliability, reduced environmental and climate impacts, improved air quality and public health, and increased jobs and economic growth. Coalitions of governments, corporations, institutions and non-governmental organisations have boosted global energy efficiency efforts, recognising the potential to greatly reduce greenhouse gas emissions.

Global primary energy intensity – the amount of energy used per unit of GDP – fell more than 10% between 2013 and 2018, although the annual improvement slowed over the period. The decline in energy intensity has been facilitated in part by the uptake of renewables, as the use of some sources of renewable power – particularly hydropower, solar PV and wind power technologies – lessens the amount of primary energy needed to meet final energy needs by reducing the overall transformation losses in generation. Meanwhile, improvements in final energy intensity reduce overall energy demand, and can enable the same renewable energy sources to supply a larger share of the world’s final energy needs.

In member countries of the Organisation for Economic Co-operation and Development (OECD), final energy intensity improved 14% between 2007 and 2017; during this same period, consumption of renewable energy increased around 42%, while the share of modern renewables in TFEC rose 44%. In non-OECD countries, the improvement in final energy intensity was even greater during the decade (25%), but these countries also saw large increases in energy demand driven by rapid economic growth and improved energy access. As a result, while the absolute amount of renewable energy in TFEC grew at a higher rate in non-OECD countries than in OECD countries (68%), the share of renewables in TFEC in these countries increased to a lesser extent (29%).

In buildings, total energy demand continued to increase steadily despite energy efficiency improvements, due primarily to increasing population and incomes. Energy demand for transport also surged during 2000-2018 and has far exceeded the effect of greater vehicle efficiency. Energy demand in industry has grown only slightly in recent years, mitigated by structural changes as well as by greater energy efficiency.

08 FEATURE: PUBLIC SUPPORT FOR RENEWABLES

Public support for renewables has expanded in general, although some individual projects have faced opposition. Governments are using a diverse range of levers to increase support for renewables.

The views of local communities are a key factor in the uptake of renewables but are only one part of the broader social acceptance of renewables. A number of complex factors can influence the public’s reactions towards local or regional renewable energy projects, including perceptions of health and environmental impacts; perceptions of the distribution of economic costs and benefits; and the perceived fairness of the consenting process.

Opinion polls have consistently indicated strong public support for the expansion of renewables, due in part to the multiple benefits that these technologies provide. However, some individual renewable energy projects have faced opposition from local host communities. This creates an apparent “social gap” between strong overall support for renewables at the societal level and disapproval with specific proposed projects at the local level.

At a societal level, climate protests and litigation often are aligned with implicit support for renewable energy – such as the strikes and protests during 2019 involving millions of people across 150 countries demanding political action on climate change. On the other hand, perceptions of unfairness or a lack of transparency can lead the public to oppose policies intended to support an energy transition, such as in France, where protests emerged in late 2018 against government energy policies that disproportionately impacted lower-income households.

At the local level, movements for energy sufficiency and conservation have spread around the world, and the numbers of both community renewable energy projects and prosumers continue to increase. At the same time, host communities may oppose certain forms of infrastructure development including renewables because of the perceived impacts on the character of a neighbourhood or landscape.

Governments have sought to build public support through a wide range of measures, including public awareness campaigns, such as Mauritius’ campaign to increase the presence of women in the renewable energy sector. Other popular measures include improving public participation in the development and procurement of renewable energy, which often is encouraged through the development of feed-in tariff schemes, peer-to-peer models and prosumer community groups.

Governments can

build citizen support

for renewables through a wide range of measures.

Many governments have looked to share the economic benefits of renewables with host communities by establishing Just Transition Funds and by developing more “passive” forms of financial participation, such as community benefits packages and option-to-purchase share schemes. Some governments also have started to engage with the concept of energy democracy by requiring greater public participation in the project planning process for renewables. For example, developers of solar and hydropower plants in Kazakhstan and Tajikistan were required to consult with communities as part of their Stakeholder Engagement Plans.

iThe Renewables 2020 Global Status Report focuses on developments in renewable energy in 2019, and therefore does not reflect the impact of the COVID-19 pandemic on global energy systems. For immediate impacts on the renewable energy sector as of mid-2020, see Sidebar 1. An overview of the full impacts of the COVID-19 crisis on the sector will be included in GSR 2021.i

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