Re­new­ables: all set for a bright fu­ture

In­ter­na­tional En­ergy Agency (IEA) re­port shows mas­sive global up­take in re­new­ables

Middle East Business (English) - - FRONT PAGE -

New so­lar PV ca­pac­ity grew by 50% last year, with China ac­count­ing for al­most half of the global ex­pan­sion, ac­cord­ing to the In­ter­na­tional En­ergy Agency’s lat­est re­new­ables mar­ket anal­y­sis and fore­cast. For the first time, so­lar PV ad­di­tions rose faster than any other fuel, sur­pass­ing the net growth in coal. Boosted by a strong so­lar PV mar­ket, re­new­ables ac­counted for al­most two-thirds of net new power ca­pac­ity around the world last year, with al­most 165 gi­gawatts (GW) com­ing on­line, ac­cord­ing to the new re­port, Re­new­ables 2017. Re­new­ables will con­tinue to have a strong growth in com­ing years. By 2022, re­new­able elec­tric­ity ca­pac­ity should in­crease by 43%. “We see re­new­ables grow­ing by about 1,000GW by 2022, which equals about half of the cur­rent global ca­pac­ity in coal power, which took 80 years to build,” said Dr Fatih Birol, the ex­ec­u­tive di­rec­tor of the IEA. “What we are wit­ness­ing is the birth of a new era in so­lar PV. We ex­pect that so­lar PV ca­pac­ity growth will be higher than any other re­new­able tech­nol­ogy through 2022.” This year’s re­new­able fore­cast is 12% higher than last year, thanks mostly to so­lar PV up­ward re­vi­sions in China and In­dia. Three coun­tries – China, In­dia and the United States – will ac­count for two-thirds of global re­new­able ex­pan­sion by 2022. To­tal so­lar PV ca­pac­ity by then would ex­ceed the com­bined to­tal power ca­pac­i­ties of In­dia and Ja­pan to­day. In power gen­er­a­tion, re­new­able elec­tric­ity is ex­pected to grow by more than a third by 2022 to over 8,000 ter­awatt hours, which is equiv­a­lent to the to­tal power con­sump­tion of China, In­dia and Ger­many com­bined. By then, re­new­ables will ac­count for 30% of power gen­er­a­tion, up from 24% in 2016. The growth in re­new­able gen­er­a­tion will be twice as large as that of gas and coal com­bined. Though coal re­mains the largest source of elec­tric­ity gen­er­a­tion in 2022, re­new­ables close the gen­er­a­tion gap with coal by half in just five years. The de­ploy­ment in so­lar PV and wind last year was ac­com­pa­nied by record-low auc­tion prices, which fell as low as 3 cents per kwh (or kilo­watt hour). Low an­nounced prices for so­lar and wind were recorded in a va­ri­ety of places, such as In­dia, the United Arab Emi­rates, Mex­ico and Chile. These an­nounced con­tract prices for so­lar PV and wind power pur­chase agree­ments are

in­creas­ingly com­pa­ra­ble or lower than gen­er­a­tion cost of newly built gas and coal power plants. China re­mains the undis­puted leader of re­new­able elec­tric­ity ca­pac­ity ex­pan­sion over the fore­cast pe­riod with over 360GW of ca­pac­ity com­ing on­line, or 40% of the global to­tal. China’s re­new­ables growth is largely driven by con­cerns about air pol­lu­tion and ca­pac­ity tar­gets that were out­lined in the coun­try’s 13th five-year plan to 2020. In fact, China al­ready ex­ceeded its 2020 so­lar PV tar­get three years ahead of time and is set to achieve its on­shore wind tar­get in 2019. Still, the grow­ing cost of re­new­able sub­si­dies and grid in­te­gra­tion is­sues re­main two im­por­tant chal­lenges to fur­ther ex­pan­sion. Un­der an ac­cel­er­ated case – where gov­ern­ment pol­icy lifts bar­ri­ers to growth – IEA anal­y­sis finds that re­new­able ca­pac­ity growth could be boosted by an­other 30%, to­talling an ex­tra 1,150GW by 2022 led by China. So­lar PV and wind ca­pac­ity in China could by then reach twice the to­tal power ca­pac­ity of Ja­pan to­day. In­dia’s move to ad­dress the fi­nan­cial health of its util­i­ties and tackle grid-in­te­gra­tion is­sues drive a more op­ti­mistic fore­cast. By 2022, In­dia's re­new­able ca­pac­ity will more than dou­ble. This growth is enough to over­take re­new­able ex­pan­sion in the Euro­pean Union for the first time. So­lar PV and wind to­gether rep­re­sent 90% of In­dia’s ca­pac­ity growth as auc­tions yielded some of the world’s low­est prices for both tech­nolo­gies.

De­spite pol­icy un­cer­tain­ties at the fed­eral level, the United States re­mains the sec­ond-largest growth mar­ket for re­new­ables. The main driv­ers for on­shore wind and so­lar – such as multi-year fed­eral tax in­cen­tives com­bined with re­new­able port­fo­lio stan­dards as well as state-level poli­cies for dis­trib­uted so­lar PV – re­main strong. Still, the cur­rent un­cer­tainty over pro­posed fed­eral tax re­forms, in­ter­na­tional trade and en­ergy poli­cies could al­ter the eco­nomic at­trac­tive­ness of re­new­ables and ham­per their growth over our fore­cast pe­riod. The re­port also pro­vides de­tailed anal­y­sis on the re­new­able con­sump­tion of elec­tric cars and off-grid so­lar de­ploy­ment in Africa and de­vel­op­ing Asia. Off-grid ca­pac­ity in these re­gions will more than triple reach­ing over 3 000MW in 2022 from in­dus­trial ap­pli­ca­tions, so­lar home sys­tems (SHSs) and mini-grids driven by gov­ern­ment elec­tri­fi­ca­tion pro­grammes and pri­vate sec­tor ini­tia­tives. While this rep­re­sents less than 5% of to­tal PV ca­pac­ity in­stalled in both re­gions, the eco­nomic im­pact is nonethe­less sig­nif­i­cant, and brings ba­sic elec­tric­ity ser­vices to al­most 70 mil­lion more peo­ple in de­vel­op­ing Asia and sub-Sa­ha­ran Africa in the next five years. Power con­sump­tion of EVs – in­clud­ing cars, two- and-three wheel­ers and buses – is ex­pected to dou­ble over the next five years, with re­new­able elec­tric­ity es­ti­mated to rep­re­sent al­most 30% of their con­sump­tion by 2022, up from 26% to­day. EVs play a com­ple­men­tary role to bio­fu­els, which rep­re­sent 80% of growth in re­new­able en­ergy con­sump­tion in trans­port. How­ever, the share of re­new­ables in to­tal road trans­port en­ergy con­sump­tion re­mains limited, in­creas­ing only from 4% in 2016 to al­most 5% in 2022.

Re­new­ables projects grow­ing across MENA

An­other re­port, Re­new­able En­ergy in the MENA Re­gion 2017, shows just how far our re­gion has come in re­cent years. This re­search by Meed, a busi­ness in­tel­li­gence ser­vice, has in­di­cated an un­prece­dented surge of re­new­able en­ergy projects in the Mid­dle East and North Africa (MENA) re­gion, re­quir­ing more than $200 bil­lion worth of in­vest­ment in the com­ing years. More than 67 gi­gawatts (GW) of clean en­ergy projects are cur­rently at the de­sign and study stage within

the re­gion. This surge in ca­pac­ity will also ne­ces­si­tate a sig­nif­i­cant ex­pan­sion and up­grade of ex­ist­ing power net­works to fa­cil­i­tate the ex­tra ca­pac­ity. “The pipe­line of re­new­able en­ergy projects will in­crease fur­ther in the next five years as gov­ern­ments seek to meet the rapidly grow­ing de­mand for power through im­ple­ment­ing am­bi­tious re­new­able en­ergy pro­grammes,” said Meed in its re­port. While the re­gion has been slow to adopt re­new­able en­ergy in the past due to its large hy­dro­car­bon re­serves, there has been a sig­nif­i­cant shift over the past five years, with more to come. Af­ter the launch of Abu Dhabi's 100 megawatt (MW) Shams 1 plant, the re­gion's first util­ity scale so­lar fa­cil­ity pre­vi­ously fea­tured by our mag­a­zine, the dra­matic fall in the cost of pho­to­voltaic (PV) so­lar in re­cent years has led to the launch of some of the world's largest so­lar projects in the re­gion, sup­ported by the sub­mis­sion record low tar­iffs. These in­clude a 300MW so­lar project in Saudi Ara­bia, launched in April, and a 200MW so­lar project from the Dubai Elec­tric­ity and Wa­ter Au­thor­ity. Meed's sur­vey of 12 Mena coun­tries found that to­tal in­stalled gen­er­at­ing ca­pac­ity in 2015 was 271,761MW, with just over 7% of this fig­ure de­rived from re­new­able en­ergy. Much of this ca­pac­ity de­rives from hy­dropower, with only Morocco in North Africa and Abu Dhabi and Dubai in the UAE com­mis­sion­ing so­lar projects with ca­pac­i­ties greater than 100MW. “This is set to change sig­nif­i­cantly in the com­ing years, with the record-low tar­iffs be­ing achieved for util­ity-scale re­new­ables projects through­out the re­gion chang­ing the per­cep­tions of gov­ern­ments and util­i­ties to­wards re­new­able en­ergy,” the re­port added. Saudi Ara­bia, for ex­am­ple, is cur­rently un­der way with its first round of the Na­tional Re­new­able En­ergy Pro­gramme, which will ten­der more than 700MW of so­lar and wind projects this year. This is part of the king­dom’s plan to gen­er­ate 9.5GW within six years. Ear­lier this year, the In­ter­na­tional Re­new­able En­ergy Agency (Irena) said the UAE led the re­gion in re­new­able en­ergy, pro­duc­ing 139MW, up from 134MW in 2015. Irena, based in Abu Dhabi, said that 2016 was the strong­est year for new re­new­able ca­pac­ity around the world, which was up by 161GW. The agency es­ti­mated that by the end of last year, global ca­pac­ity reached 2,006GW, with so­lar en­ergy show­ing es­pe­cially strong growth.

Newspapers in English

Newspapers from Palestine

© PressReader. All rights reserved.