A report published by United Nations Environment, the Frankfurt School – UNEP Collaborating Centre, and Bloomberg New Energy Finance, shows that the world added record levels of renewable energy capacity in 2016 as the cost of clean technology continues to fall.
Global Trends in Renewable Energy Investment 2017 found that wind, solar, biomass and waste-to-energy, geothermal, small hydro and marine sources added 138.5 gigawatts to global power capacity in 2016 – an 8 percent increase from the 127.5 gigawatts added in 2015. This added generating capacity roughly equals that of the world’s 16 largest existing power producing facilities combined.
The study also found that investment in renewables capacity roughly doubled that of fossil fuel generation, and the corresponding new capacity from renewables made up 55 percent of all new power – the highest to date.
The total investment was $241.6 billion – excluding large hydro – which is actually the lowest amount since 2013. Experts believe this is largely due to the falling costs of renewable energy. “Ever-cheaper clean tech provides a real opportunity for investors to get more for less,” says Erik Solheim, Executive Director of UN Environment. “This is exactly the kind of situation, where the needs of profit and people meet, that will drive the shift to a better world for all.”
Although a lot of the renewable financing drop can be explained by reduced technology costs, the report also documents a slowdown in China, Japan, and some emerging markets for a variety of reasons. Renewable energy investment also dropped in both developed and developing countries.
However, investment in renewables increased by 3 percent in Europe, mainly due to the UK and Germany. Offshore wind was a major target of European investors, increasing by 53 percent from the previous year.
The proportion of electricity coming from renewables (excluding large hydro once again) rose a full percentage point, and prevented the emission of an estimated 1.7 gigatonnes of carbon dioxide.
Data from the International Energy Agency points to the switch to renewables as one of the key reasons for greenhouse gas emissions staying flat in 2016, even though output in the global economy rose by 3.1 percent.
Due to the dramatic cost reductions in technology for solar and wind, it “can provide the lowest cost new electrical power in an increasing number of countries, even in the developing world — sometimes by a factor of two,” explains Michael Liebreich, Chairman of the Advisory Board at BNEF.
Although investment is down in some areas, a record level of renewable energy capacity was added this past year and the cost of much of the technology is only getting smaller. This is good news for anybody hoping to see fossil fuels phased out and renewable energy gain a stronger foothold worldwide.
Source: UN Environment