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.
Renewable 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.
Renewable 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.