Why is renewable energy important?

Renewable energy is good for the planet and for people, but what is it exactly? From solar to wind, find out more about green energy, the fastest-growing source of energy in the world – and how we can use it to benefit the climate, the environment, the economy and social cohesion.

On this page:

What is renewable energy?

Renewable energy is energy derived from natural resources that replenish themselves in less than a human lifetime without depleting the planet’s resources. These resources – such as sunlight, wind, rain, tides, waves, biomass and thermal energy stored in the earth’s crust – have the benefit of being available in one form or another nearly everywhere. They are virtually inexhaustible. And, what is even more important, they cause little climate or environmental damage.

Fossil fuels such as oil, coal, and natural gas on the contrary are available in finite quantities only. As we keep extracting them, they will run out sooner or later. Although they are produced in natural processes, they do not replenish as quickly as we humans use them.

Today, the world still heavily relies on fossil fuels and even continues subsidising them. Meanwhile, the pollution they cause – from climate-damaging greenhouse gases to health-endangering particles – has reached record levels. And when something goes wrong, for example when the Deepwater Horizon oil platform exploded in 2010, the consequences are dramatic.

Since 2011, renewable energy is growing faster than all other energy forms. Renewable energy had another record-breaking year in 2020, as installed power capacity grew more than 256 gigawatts (GW) – its largest increase ever. More than 29% of our electricity now comes from renewable energy – and this keeps growing.

Key benefits of renewable energy for people and the planet

Like any human activity, all energy sources have an impact on our environment. Renewable energy is no exception to the rule, and each source has its own trade-offs. However, the advantages over the devastating impacts of fossil fuels are undeniable: from the reduction of water and land use, less air and water pollution, less wildlife and habitat loss, to no or lower greenhouse gas emissions.

In addition, their local and decentralised character as well as technology development generate important benefits for the economy and people.

  • Renewable energy emits no or low greenhouse gases. That’s good for the climate.

The combustion of fossil fuels for energy results in a significant amount of greenhouse gas emissions that contribute to global warming. Most sources of renewable energy result in little to no emissions, even when considering the full life cycle of the technologies.

  • Renewable energy emits no or low air pollutants. That’s better for our health.

Worldwide increases in fossil fuel-based road transport, industrial activity, and power generation (as well as the open burning of waste in many cities) contributes to elevated levels of air pollution. In many developing countries, the use of charcoal and fuelwood for heating and cooking also contributes to poor indoor air quality. Particles and other air pollutants from fossil fuels literally asphyxiate cities. According to studies by the World Health Organisation, their presence above urban skies is responsible for millions of premature deaths and costs billions.

“Instead of depleting precious resources and polluting the environment, renewable energy meets the objectives of a circular economy and is a strong motor for social and economic development”

Inger Andersen, UNEP Executive Director.

  • Renewable energy comes with low costs. That’s good for keeping energy prices at affordable levels.

Geopolitical strife and upheavals often come with increasing energy prices and limited access to resources. Since renewable energy is produced locally, it is less affected by geopolitical crisis or price spikes or sudden disruptions in the supply chain.

  • Renewable energy creates jobs. That’s good for the local community.

The largest part of renewable energy investments is spent on materials and workmanship to build and maintain the facilities, rather than on costly energy imports. Renewable energy investments are usually spent within the continent, frequently in the same country, and often in the same town. This means the money citizens pay on their energy bill stays home to create jobs and fuel the local economy.

  • Renewable energy makes the energy system resilient. That’s important to prevent power shortages.

Renewables make urban energy infrastructures more independent from remote sources and grids. Businesses and industry invest in renewable energy to avoid disruptions, including resilience to weather-related impacts of climate change.

“An energy system based on distributed and decentralised generation is more flexible and resilient to those central shocks which are becoming more frequent with climate change”.

Rana Adib, REN21 Executive Director.

  • Renewable energy is accessible to all. That’s good for development.

In many parts of the world, renewables represent the lowest-cost source of new power generation technology, and costs continue to decline. Especially for cities in the developing world, renewable energy is the only way to expand energy access to all inhabitants, particularly those living in urban slums and informal settlements and in suburban and peri-urban areas.

  • Renewable energy is secure. That’s good for stability.

Evolving energy markets and geopolitical uncertainty have moved energy security and energy infrastructure resilience to the forefront of many national energy strategies. Security of supply is a serious concern in energy markets worldwide, from the European Union and the United States to Egypt and India.

  • Renewable energy is democratic. That’s good for acceptance.

In recent years, the number of community energy projects using renewable sources have surged in various parts of the world. Although community energy is frequently associated with Northern European countries such as Denmark and Germany, such projects are emerging in other parts of the world including Thailand, Japan, and Canada. This trend confirms that democracy is an important driver for the change to renewable energy.

“Cities can actively drive the fight against climate change at the national and global level. They are able to tap into opportunities that other levels of government do not have, including a more direct relationship with local citizens and businesses. Citizen engagement and public pressure have raised cities’ level of ambition on renewables in many places around the world.”

 Svenja Schulze, Minister for Environment, Nature Conservation and Nuclear Safety, Germany.

Where can renewable energy be used?

Renewable energy can be used in all energy sectors: from power production and thermal comfort in buildings to industry and transport.

Thermal comfort in buildings (heating and cooling). Examples for the use of renewable energy in buildings are solar thermal water heaters, biomass boilers, heat pumps, and natural cooling. Reducing the energy demand of buildings and industry is key to transitioning to a renewables-based energy system. Therefore, an integrated policy approach to renewable energy and energy efficiency is fundamental.

Industrial heating and cooling processes, such as food processing and pulp and paper, can also be run on renewable energy. Hydrogen produced with renewables electricity can meet the needs of high-heat intensive industrial processes in the iron and steel and chemical industries.

In transport, renewable energy can be used in the form of sustainable biofuels, high-percentage biofuel blends and drop-in biofuels. Renewable electricity can power the world’s growing fleet of electric vehicles. Car batteries can be used as storage units so that the electricity can be used at a later time. Renewable electricity also can be used to produce electro-fuels, such as hydrogen to fuel long-haul transport, aviation and shipping. A focus on reducing overall fuel demand in the transport sector is critical and can be accomplished through policies that promote energy efficiency and conservation.

Worldwide, renewables already supplied 29% of electricity in 2020. Yet, outside of electricity, good news is still hard to come by. Uses of electricity (e.g., lighting and appliances) only represent 17% of the world’s energy needs. About half of the energy is used for heating and cooling, one-third goes to the transport sector. With far lower shares of renewable energy, these two sectors are both lagging far behind in decarbonisation.

Tools and resources

Since 2005 REN21 has have been tracking what is happening where in the world in renewable energy markets, policies and investment.

There are plenty of cities in the world that already source 100 percent of their electricity from renewables. Now, they are taking steps to expand their ambitions to get rid of fossil fuels in heating, cooling, transport and industry. This report is an annual stocktaking of how city action can directly support the transition to renewable energy. It aims at making data available, more standardised, easier to evaluate and to compare.