Renewable energy used in the power sector – wind, solar, biomass and geothermal – grows quickly in all three scenarios, aided by falling costs of production and policies encouraging a shift to lower carbon energy sources.
The expansion of renewable energy in power in Rapid and Net Zero far outpaces the growth of primary energy, increasing by around 250 EJ and 350 EJ respectively over the Outlook – around five and seven times greater than the overall increase in primary energy.
The fast pace of growth eases slightly from the late 2030s onwards as the costs of balancing the intermittency associated with adding increasing amounts of wind and solar power rise. Even so, the share of renewables in primary energy grows from around 5% in 2018 to 45% by 2050 in Rapid and 60% in Net Zero.
The growth in renewable energy is dominated by wind and solar power, underpinned by continuing falls in development costs as they move down their ‘learning curves’. Over the next 30 years, wind and solar costs fall by around 30% and 65% in Rapid respectively and by 35% and 70% in Net Zero.
In both Rapid and Net Zero, wind and solar power account for broadly similar absolute increases in power generation. This equates to a significantly faster rate of expansion in solar power, supported by (and driving) the greater cost declines.
The growth of renewables in power is less fast in BAU, although they still grow seven-fold and contribute around 90% of the growth in primary energy over the Outlook.
In all three scenarios, emerging economies account for the majority of the growth in renewable energy, driven by stronger growth in power generation and by the increasing share of renewables in power, especially at the expense of coal.
The growth of wind and solar power generation in all three scenarios requires a significant acceleration in the build out of renewable capacity.
The average annual increase in wind and solar capacity in Rapid and Net Zero over the first half of the Outlook is around 350 GW and 550 GW respectively, between 6 and 9 times faster than the annual average of around 60 GW since 2000.
Although such an acceleration in wind and solar capacity requires a significant increase in investment spending, the extent of that increase is partially offset by the falling development costs of wind and solar energy. The implications for investment in wind and solar energy are considered in Investment.
The fast growth in wind and solar power generation in Rapid and Net Zero followed by a subsequent slowing as the costs of intermittency build is reflected in the pattern of capacity additions, which peak around 2035 in Rapid and Net Zero before slowing sharply. This hump in the pattern of new additions raises the risk of excess capacity within the renewables supply chain towards the end of the Outlook.
The acceleration in the build out of wind and solar capacity in BAU is more gradual and steadier, although the average annual rate of capacity construction (235 GW) over the Outlook is still considerably faster than past rates of expansion
In Rapid and Net Zero, developed countries represent around 25% of total deployment of wind and solar, China accounts for broadly another 25%, with the rest accounted for by other emerging economies. In BAU, developed economies have a larger role – accounting for around a third of total deployment.
A significant share of wind and solar energy is used to produce green hydrogen in Rapid and Net Zero, with this share increasing to around 20% of total installed capacity by 2050 in Rapid and to around a third in Net Zero.