Global clean renewable energy growths and investments

Global investments in clean renewable power and clean fuels have been growing strongly in recent year. These have exceeded USD200 billion per year for the past seven years. A good example is that in 2016 the total new investment in renewable power and fuels was over USD260 billion. It is also worth noting that for the fifth consecutive year, the total investments in new renewable power generation capacities globally have been roughly doubled that in fossil fuel power generating capacities internationally. Global investments in clean renewable energies have continued to be focusing primarily on the solar and wind renewable power sectors. Asset financing of utility projects, such as wind farms and solar parks, has dominated global clean renewable investments in recent years. There have also been significant cost reductions in both solar and wind renewable areas in recent years. These have been achieved with new technology innovations and cost reduction measures. Looking ahead, renewable energies are likely to become more cost competitive against fossil fuels in the near future (IRENA, Investments in Renewables Analysis, 2018).

The global renewable power generation sector has continued to attract far more clean investments than for fossil power or nuclear power generating plants. A good example is that in 2016 it has been calculated that nearly USD250 billion of clean investments has been committed to construct new renewable power generation plants globally. These renewable investments have been about twice of the committed investments of USD134 billion for new fossil and nuclear power plants. These included some USD114 billion of investment in new fossil fuel-fired generating capacities and USD30 billion in new nuclear power capacities. Overall, renewable power generation has been accounting for over 60% of the total new power generating capacity investments globally in recent years (Wang, IOD Climate Finance Green Investment Paper, 2018).

Globally, renewable energy investments in the developing and emerging economies have overtaken those in developed countries for the first time in 2015. In 2016, clean investments in developed countries retook their lead over the developing countries. These have mainly resulted from the new renewable drives and clean energy policies introduced by the governments in various emerging economies and developed countries. The clean investment trends in the renewable energy sector have been varying widely by regions globally. China has been

Clean renewable energy growth management 7 leading the global renewable energy investments with about 32% of the global investments. Europe was second with 25% of the global investments, the United States was third with 19% and Asia-Oceania was fourth with 11%. The Americas, Latin America plus the Middle East and Africa regions have each accounted for about 3% of the global renewable investments.

The top ten countries globally with the highest clean energy investments included three emerging countries and seven developed countries. The top five countries included China, the United States, the United Kingdom, Japan and Germany. The next five countries included India, Brazil, Australia, Belgium and France.

However, there have also been significant increases in clean energy investments recently in some specific countries across the world. A good country example is Singapore which has increased its renewable investments by over ten-fold to USD700 million. Vietnam has also increased its renewable investments by over 140% to USD700 million whilst also continuing with some new coal-fired power station investments. Indonesia has also increased its renewable investments by over 80% to USD500 million. Mongolia has increased its renewable investments to USD200 million in 2016 from having no renewable energy investment in 2015. Thailand has increased its renewable investments by 4% to USD1.4 billion. These investments have led Thailand to become Asia’s emerging economy with the third highest renewable investments, after China and India (UNEP, Renewable Investment Global Trends Report, 2019).

In recent years, renewable power generation has been achieving its largest annual capacity increases. These have been driven by the new clean energy policies in most countries and their drive to reduce GHG emissions. A good example is that over 160 gigawatts (GW) of new renewable energy capacity was added in 2016 which resulted in total global renewable power capacity being raised by almost 9% compared to 2015 (REN, Global Status Report, 2018).

Solar PV has seen record new capacity additions in emerging economies and developed countries globally in recent years. It has accounted for more new capacity additions than other renewable and fossil power generating technologies. Solar PV has represented about 47% of newly installed clean renewable energy power capacities. Wind and hydropower have accounted for most of the remaining new power capacity additions. Wind power has contributed about 34% and hydropower has contributed about 15%.

Experts have estimated that globally more new clean renewable energy power capacities have been added annually, than all fossil fuel capacities combined in recent years. A good energy example is that in 2016 renewable power generation accounted for over 60% of net additions to global power generating capacity globally. Experts have also reported that renewable power generation has been supplying about a quarter, near to 25%, of global electricity demands. Hydropower has been providing the majority of the renewable power with over 16% of global electricity demands. The other renewables, including solar, wind, geothermal, biopower, etc., have been supplying the remaining 9% of global renewable power consumptions.

The top countries with installed clean renewable electric power generation capacity continued to be China, the USA, Brazil, Germany and Canada. China has continued to be the global leader with more than one quarter of the world’s clean renewable power installed capacities.

The ongoing growth and geographical expansion of renewable energy have also been driven by the continued innovation and cost reductions in renewable technologies. Significant cost reductions have been achieved in both solar PV and wind power with new technological innovations and manufacturing cost-cutting initiatives. Solar PV and onshore wind power have already become cost competitive against new fossil fuel and nuclear power generation options in an increasing number of locations globally. These have been due in part to the declines in component prices and improvements in generation efficiency. The competitive bid prices for new offshore wind power stations have also improved significantly in Europe in recent years. These have contributed to making wind power more attractive.

Cost reductions in clean renewable energy are particularly important for developing countries and emerging economics. These have made new clean renewable energy installations more attractive. In particular, new renewable electrical supply systems have become attractive for remote locations, such as islands or isolated rural communities, where electricity prices have been high and access to grid connections is difficult.

Many developing countries have to bring online an increasing number of new power generating capacities in order to meet the rapidly rising electricity demands from their growing population. They have increasingly turned to clean renewable technologies which might be grid-connected or off-grid. They have also been introducing new supporting policies such as competitive tendering or feed-in tariffs (FITs) so as to support their new clean renewable energy growths. A good example is the supply of new clean renewable energy with distributed power systems which have become particularly attractive for supplying clean electricity to remote rural communities in developing economies worldwide (UNEP, District Energy in Cities, 2018).

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