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Renewables dominated global power additions in 2021

960 640 Stuart O'Brien

Data released by the International Renewable Energy Agency (IRENA) shows that renewable energy continued to grow and gain momentum despite global uncertainties.

By the end of 2021, global renewable generation capacity amounted to 3 064 Gigawatt (GW), increasing the stock of renewable power by 9.1 per cent.

Although hydropower accounted for the largest share of the global total renewable generation capacity with 1 230 GW, IRENA’s Renewable Capacity Statistics 2022 shows that solar and wind continued to dominate new generating capacity. Together, both technologies contributed 88 per cent to the share of all new renewable capacity in 2021. Solar capacity led with 19 per cent increase, followed by wind energy, which increased its generating capacity by 13 per cent.

IRENA Director-General Francesco La Camera, said: “This continued progress is another testament of renewable energy’s resilience. Its strong performance last year represents more opportunities for countries to reap renewables’ multiple socio-economic benefits. However, despite the encouraging global trend, our new World Energy Transitions Outlook shows that the energy transition is far from being fast or widespread enough to avert the dire consequences of climate change.”

“Our current energy crisis also adds to the evidence that the world can no longer rely on fossil fuels to meet its energy demand. Money directed to fossil fuel power plants yields unrewarding results, both for the survival of a nation and the planet. Renewable power should become the norm across the globe. We must mobilise the political will to accelerate the 1.5°C pathway.”

To achieve climate goals, renewables must grow at a faster pace than energy demand. However, many countries have not reached this point yet, despite significantly increasing the use of renewables for electricity generation.

Sixty per cent of the new capacity in 2021 was added in Asia, resulting in a total of 1.46 Terawatt (TW) of renewable capacity by 2021. China was the biggest contributor, adding 121 GW to the continent’s new capacity. Europe and North America—led by the USA—took second and third places respectively, with the former adding 39 GW, and the latter 38 GW. Renewable energycapacity grew by 3.9 per cent in Africa and 3.3 per cent in Central America and the Caribbean. Despite representing steady growth, the pace in both regions is much slower than the global average, indicating the need for stronger international cooperation to optimise electricity markets and drive massive investments in those regions.

Highlights by technology:

  • Hydropower: Growth in hydro increased steadily in 2021 with the commissioning of several large projects delayed through 2021.
  • Wind energy: Wind expansion continued at a lower rate in 2021 compared to 2020

(+93 GW compared to +111 GW last year).

  • Solar energy: With an increase in new capacity in all major world regions in previous years, total global solar capacity has now outgrown wind energy capacity.
  • Bioenergy: Net capacity expansion increased in 2021 (+10.3 GW compared to +9.1 GW in 2020).
  • Geothermal energy: Geothermal capacity had an exceptional growth in 2021, with 1.6 GW added.
  • Off-grid electricity: Off-grid capacity grew by 466 MW in 2021 (+4%) to reach 11.2 GW.

Read the full Renewable Capacity Statistics 2022 including the highlights, here.

UK investors and wealth managers increasing their allocation to renewables

960 640 Stuart O'Brien

Research from Downing LLP (Downing) has revealed a dramatic increase in focus on renewables from UK pension funds, other institutional investors and wealth managers.

Downing offers both institutional and retail investors the opportunity to invest in renewable energy and other infrastructure in the UK and northern Europe.

Its survey of 100 UK professional investors, who collectively manage around £118 billion in assets under management, reveals 80% increased their allocation to renewables over the past 12 months with 26% making a dramatic increase while 54% made a slight increase.

Nearly all (97%) of the respondents say they will increase their allocation to renewable energy in the next year.

Henrik Dahlstrom, Investment Director at Downing Renewables & Infrastructure Trust, said: “As the renewables sector develops, it increasingly illustrates several features that investors find very attractive, especially in the current environment of low yields and rising inflation – both issues renewables can help investors to address.”

Downing’s research found all renewable energy sectors are expected to attract more investment, and when asked to select their top five reasons for this, three-quarters (74%) of professional investors surveyed cite the asset class’s recent strong performance, and the de-risking potential in volatile markets (69%).

Other attractions of investing in renewable energy included the diversification potential (67%); improved regulatory environment for investing in renewables (67%); a growing focus on decarbonisation from pension funds and wealth managers (62%); improved liquidity (60%); a good hedge against inflation (55%); and a greater pressure to invest in renewables (46%).

The sectors most likely to attract increased investment are as follows:

  Increase dramatically Increase slightly Stay the same Decrease
Wind 39% 40% 21% 0%
Solar 38% 18% 41% 3%
Hydro 41% 44% 13% 2%
Biomass 38% 46% 9% 7%
Tidal and wave 29% 47% 23% 1%

Dahlstrom added: “Renewable energy is central to UK institutional investors and wealth managers as they set responsible and ESG investment strategies. We have long capitalised on the diversification benefits of investing in renewable energy and as inflation bites and market volatility continues, allocating to the asset class will become even more important.

“It is important that investors can find genuine investment opportunities that help them meet their ESG credentials. Our investment trust DORE, for example, is one of the few funds classified as an Article 9 fund under the EU’s Sustainable Finance Disclosure Requirement (SFDR), which means we make impactful investments and have specific Sustainable Investment Objectives.”

Over the last 12 years, Downing has invested in more than 175 core renewables projects across Europe.

These renewable energy investing projects have stable, predictable, long-term cashflows and are often wholly or partly linked to inflation.

ScottishPower makes major UK solar play with acquisitions

960 640 Stuart O'Brien

Iberdrola-owned ScottishPower has signed two deals to acquire 17 solar photovoltaic (PV) projects in the UK, with a combined capacity of more than 800 MW. The contracts have been concluded separately with Elgin Energy, which owns 12 projects, and Lightsource BP, which controls the rest.

Both companies are experienced developers with a long track record in renewable energy.

The projects, across England, Scotland and Wales, are in advanced stages of development and will be operational by 2025 with a total investment of approximately £500 million (around €600 million). This portfolio of solar sites will add enough clean energy to power over 220,000 homes.

ScottishPower claims it is now at the forefront of the UK’s solar industry, with its market share rising from 2% to 9%, confirming the company’s commitment to growing the renewables market across the UK, where it is the only 100% green integrated utility. The deals will also contribute towards reaching net zero greenhouse gas emissions in Scotland in 2045 and in the United Kingdom by 2050.

Lindsay McQuade, CEO of ScottishPower Renewables, said: “Moving into 2022, we are continuing to push forward our plans at ScottishPower to support the transition to Net Zero.  This boost to our solar generation pipeline complements our existing growth plans for wind and storage.

“With plans to invest close to £4 billion by 2025, doubling the volume of renewable electricity we produce, we are taking action every day to deliver on our commitment to deploy more renewables – at scale and at speed – to electrify how we live, work and travel. This addition to our portfolio will help accelerate that journey and play an important role in tackling the climate emergency.”

As of September 2021, Iberdrola has almost 3GW of installed PV worldwide, an increase of 89% compared to 2019. Of this capacity, 2,028MW are in Spain, 642MW in Mexico, 191MW in the US, 4MW in the UK and 31 MW in other countries. It also has 31 GW of solar projects under development in Spain, US, Mexico, UK, Portugal and Italy. The company’s investment plan for 2020-2025 sets to double its current PV capacity to 6GW by the end of 2022, and to have 14 GW installed by 2025.

School kids want to see more renewables usage post COP26

960 640 Stuart O'Brien

Young people (aged 6-15) across the UK want to see more clean energy powering the country and people taking personal responsibility to protect the planet, including the use of more renewables in schools.

The call for a cleaner and greener future came from independent YouGov research commissioned by ScottishPower Renewables during the United Nations COP26 Climate Change Conference, held in Glasgow last month.

YouGov asked over 1,000 British children aged 6 – 15 years for their thoughts on UK climate action and what was needed to tackle the climate crisis.

More than three-quarters (81 per cent) of those responding called for more renewable energy to be used, while 58 per cent said it was up to “everyone” to make sure the planet is protected.

Young people surveyed also said COP26 had inspired them to take action themselves to help the environment, with 53 per cent committing to recycling more and over one third (35 per cent) saying they would ditch the car in favour of active travel options like cycling and walking.

And they called on schools to take action too, with demands for the introduction of more wind turbines and solar panels to power their schools (59%) and more lessons about climate change (42%).

The YouGov findings echo feedback from secondary school pupils who took part in ScottishPower Renewables’ COP26 ‘Let’s Talk Energy’ event, where green jobs and more investment to create clean energy were identified as what’s needed to deliver a low-carbon future.

Lindsay McQuade, CEO of ScottishPower Renewables, said: “As a Principal Partner for COP26 and lead for the conference’s youth theme, ScottishPower recognises the importance of listening to young people.  Every action taken today will impact their future and it’s vital that they therefore have their say on what they want for a cleaner and greener future.

“This survey shows that children and young people understand the climate emergency and recognise that renewable energy has a crucial part to play as we move forward, electrify our lives and reduce our carbon footprint. We fully support the call for more renewable energy and we’re doing everything we can to make it happen – investing almost £4 billion to double our current renewables capacity by 2025, with plans to treble it by 2030.

“Importantly, the survey also shows that young people know we all have the power to make a real difference to the environment by making changes in how we live our lives. Whether that’s in how we travel around, the food we eat or the clothes we wear – it all matters – and it’s great that COP is inspiring such positive action from young people.

“With human behaviour responsible for many of the changes to our planet, the only way we’ll be successful in tackling the climate emergency is by everyone joining in and doing their bit. Young people understand that – it’s something we can all learn from and something that can give us all hope for a clean energy future.”

As part of its COP26 education programme, ScottishPower Renewables is also working with Glasgow Science Centre on a Renewables Challenge for 124 primary schools and 10 secondary schools. Through the programme pupils learn about COP26, renewable energy, green jobs and going carbon neutral.

Norway leading the way on renewable and UK slips behind

960 640 Stuart O'Brien
Research has found Norway is the world leader in renewable energy use, making up 56% of its total energy supply, while the UK ranks 20th as renewable energy only accounts for 13%.
A study by energy tariff comparison platform Utility Bidder has revealed which countries rely the most on fossil fuels (coal, oil and natural gas) renewable energy (hydropower, biofuels and waste, wind and solar) and also nuclear energy to reveal the distribution of energy sources around the world.
The top 5 countries with the highest share of renewable energy

Rank

Country

Total energy supply (ktoe)

Renewable energy supply (ktoe)

Renewable energy as % of total supply

1

Norway

23,753

13,308

56%

2

Brazil

289,130

133,460

46%

3

New Zealand

20,589

8,641

42%

4

Sweden

49,204

20,115

41%

4

Denmark

16,011

6,529

41%

5

Finland

32,031

11,866

37%

20

UK

169,543

22,842

13%

Norway uses the biggest share of renewable energy in the world, making up 56% of its total energy supply. It also utilises hydropower more than any other country as that accounts for 45% of its supply alone. The country is known for being experts in the field of hydroelectricity with many steep valleys and rivers, as well as increased rainfall due to climate change, meaning hydroelectricity is a fruitful opportunity.

With the second highest supply of renewable energy, Brazil is also the leader in biofuel and waste energy, which accounts for 32% of its total energy supply. Brazil is the second-largest producer of ethanol fuel and is an industry leader, with its sugarcane-based ethanol being touted as the most successful alternative fuel to date, based on advanced agri-industrial technology.

Renewable energy sources in total account for 42% of New Zealand’s energy supply. It is also the world leader in wind and solar energy which makes up 25% of New Zealand’s energy supply. Situated in the path of the ‘Roaring Forties’, a set of strong and constant westerly winds, the nation is perfectly positioned for wind power and enjoys plenty of sunshine for solar energy too, as well as having an increasing market for solar hot water heating systems.

The top 5 countries with the highest share of fossil fuels

Rank

Country

Total energy supply (ktoe)

Fossil fuel energy supply (ktoe)

Fossil fuels as % of total supply

1

Singapore

37,752

37,062

98%

2

Australia

132,431

122,927

93%

3

South Africa

134,645

122,398

91%

4

Luxembourg

3,453

3,122

90%

4

Netherlands

70,715

63,733

90%

4

Morocco

20,295

18,260

90%

5

Mexico

184,021

164,657

89%

18 UK
169,543
132,062
78%

Singapore relies on fossil fuels more than any other country, with 98% of its total energy supply coming from traditional fuel sources. It uses the highest proportion of oil in the world relative to total energy supply, as oil makes up 73% of Singapore’s supply. It is home to major oil companies such as Exxon Mobil, due to its ideal trading location and perceived safe environment.

Australia follows closely behind as the second most reliant on fossil fuels as this makes up 93% of its total energy supply. It is relatively evenly split between coal, oil and natural gas as each accounts for 31%, 33% and 29% of the total energy supply respectively.

While being the third most reliant on fossil fuels, South Africa also uses the highest proportion of coal in the world standing at 73% of its total supply. This is largely because coal is one of the most affordable fuel sources, but also due to a lack of real alternatives in the country too.

The Netherlands ranks joint fourth overall and also has the highest supply of natural gas than any other country, standing at 45% of its total energy supply. Fifty percent of this comes from the Groningen gas field, the largest gas field in Europe, however, the Dutch government has committed to stop regular production from the Groningen field by 2022.

The top 5 countries with the highest share of nuclear energy

Rank

Country

Total energy supply (ktoe)

Nuclear energy supply (ktoe)

Nuclear energy as % of total supply

1

France

246,349

103,966

42%

2

Sweden

49,204

17,349

35%

3

Switzerland

24,884

6,916

28%

4

Slovakia

16,318

4,110

25%

5

Belgium

55,162

11,341

21%

12 UK
169,543
14,639
9%

France is the leading country when it comes to nuclear energy, making up 42% of its energy supply, with 56 operational nuclear reactors producing 103,966 ktoe – the second largest amount produced, just behind the USA which produces 219,737 kote of nuclear energy which equates to 10% of its energy share.

You’ve done as much as you can with short payback, what else can you do?

960 640 Guest Post

By David Kipling, OnSite Energy

Many companies have by now committed to energy reduction targets either through sustainability policy, net zero goals, CO2 emissions reduction targets or via CCA agreements. Further energy efficiencies are going to be needed, as the targets are getting tougher. For CCA, renewables don’t count, it is only efficiency that is eligible.

Where efficiencies can be found will depend on your company’s existing processes and sources of energy. 

The good news is there has never been so much innovation in energy technology.  Costs are falling and the range of applications and efficiencies are improving.   So if you appraised a technology three or more years ago, its probably worth revisiting that appraisal to take account of current pricing and improved efficiencies.  

At OEP, we take a data-led, technology agnostic approach.  We can often add-value by introducing technologies and solutions that hadn’t been considered, from artificial intelligence & internet of things sensing, to the latest heat recovery, absorption chillers, or wind technology.

If this sounds interesting then please get in touch with David Kipling at david@on-site.energy or call him on 07824 018991.  OEP specialises in supporting energy intensive industry.

Italian renewable industry expands future renewable development

960 640 Stuart O'Brien

The Italian Government is expanding the integration of renewables in its generation mix to create an infrastructure for supporting sustainable green generation, thereby tackling the issues of land constraints and making continuous strides in meeting the net carbon neutrality ambition by 2050.

The constant decline in the development costs for offshore wind and floating solar PV has garnered special recognition in the country’s renewable energy plan. The Italian renewable capacity, excluding hydropower, is estimated to reach 60GW by 2030 from the current 36GW, growing at a compound annual growth rate (CAGR) of 4.5%, according to GlobalData. 

Somik Das, Senior Power Analyst at GlobalData, said: “The floating offshore wind project is a technological advancement and investments in the segment provides Italy the prospect of staying ahead in the growth curve. Along with the floating offshore wind projects, developers are also looking at building hybrid offering with integration of solar PV to improve the generation yield.” 

This year is attracting growing interest from various players that are active in the supply chain and who are investing in the Italian renewable energy landscape. In June 2020, Italian developers began work on the €750m (US$840m) 7Seas Med floating wind project with 25 floating wind turbines with 10 megawatts (MW) capacity. Terna has pledged an additional investment of €7.3bn (US$8.3bn) by 2024 to meet the growing demand for electricity from green energy.

Recently, Saipem signed a pact with renewable energy (RE) developers Agnes and Qint’X, to co-develop a project combining 450MW of offshore wind capacity with floating solar PV technology in the Italian Adriatic Sea. In a similar instance, Eni New Energy SpA has laid its plans to invest €14.7m (US$17.3m) and construct a 14 MW floating solar PV plant in Brindisi.

GlobalData says Italy is one of the primary markets for several global investors, as the country provides a perfect amalgamation of ideal climatic conditions, optimum solar irradiance, and wind speed to implement cutting-edge solar and wind technology. Floating offshore wind turbines provide more access to deeper water than conventional fixed-bottom wind turbines. This expands the practical range for wind energy development, and can potentially get access to locales with steadier and higher wind flow.

Das added: “Being limited in geographic landmass, the country is making use of its coastlines and its waters to meet its RE installation targets by the conclusion of the decade. Italy has the 2nd largest solar PV installed capacity in Europe and is looking to make headways in the offshore wind segment. The RE space is seeing global players like European Energy A/S, Sonnedix, Octopus Investments Ltd, and Copenhagen Infrastructure Partners KS investing in the country, making giant steps towards sustainability and zero-carbon generation.”

COVID to accelerate transition to renewable energy

960 640 Stuart O'Brien

It’s being predicted that the energy transition will be accelerated by several years by the COVID pandemic, with trillions of dollars expected to flow through economic relief packages into the deployment of low- and zero-carbon infrastructure, as well as research and development into technologies that enable it.

That’s the conclusion of Lux in its new report Owning The Energy Transition: 2020 COVID-19 Update, which outlines these changes and predicts the impact of the disruptive global energy transition going forward.

“The aftermath of COVID-19 will shake the economic fabric of the energy sector,” said Yuan-Sheng Yu, Senior Analyst at Lux Research. “We witnessed many historical firsts, such as oil futures trading in the negatives, U.S. renewable energy in the electricity mix surpassing coal, and the largest year-over-year drop in global CO2 emissions.”

Yu explains that while the sudden effects may be a flash in the pan as the world returns to normalcy, 2020 provided a preview of the more permanent challenges the industry will face in the next decade. This “white swan” event will force companies to learn how to be more resilient, while countries planning their post-COVID recovery will capitalize on the opportunity and accelerate the energy transition through improved resiliency and greater agility and by insulating themselves from the macroeconomic impacts of the volatile conventional energy sector.

“The pandemic highlighted the risks of disruptions to our current energy infrastructure and supply chain,” added Lux Research Analyst Tim Grejtak. “In response, we will see aggressive diversification of business portfolios to avoid the risk of underutilized and, eventually, stranded assets in order to capitalize on opportunities provided by increasing renewable energies.”

Grejtak cites long-duration energy storage investments and project developments in the first half of 2020 by the likes of Highview Power, Form Energy, and AES Distributed Energy as just the beginning of the added urgency of companies preparing for the energy transition.

Analyst Runeel Daliah added: “While COVID-19 momentarily pushed aside climate change from the political discourse, companies and countries that deprioritize climate change mitigation efforts in favor of near-term financial recovery would be making a mistake – decarbonization is an unavoidable megatrend that will continue to loom well after COVID-19.”

Daliah points to countries forging ahead with decarbonization strategies centered around hydrogen, such as Portugal, South Korea, Australia, and Germany, which recently unveiled a $10.2 billion National Hydrogen Strategy.

Meanwhile, Lux Research Senior Analyst Christopher Robison emphasized that the most noticeable effect of COVID-19 on modern life was the drastic reduction in mobility – As the world sheltered in place, there was an immediate reduction in emissions and improvement in air quality, with residents in some cities notorious for pollution seeing blue skies for the first time.

“The magnitude of the longer-term impact of COVID-19 on mobility remains unclear as more people work from home and replace work travel with virtual meetings, but the push to reduce and eliminate emissions from the transportation sector has only increased, with many post-COVID stimulus plans focused on low- and zero-emission vehicles,” said Robinson.

EDF’s solar PV expansion in UK ‘to provide impetus for economic recovery’ amid COVID-19

960 640 Stuart O'Brien

French utility EDF is launching a major solar-plus-battery storage hybrid initiative in the UK as part of its plans to increase its installed renewable base.

Analyst house GlobalData anticipates that this is likely to provide a boost to its solar portfolio in the country and also act as a green stimulus to the stagnant economy, which is now slowly resuming activities.

Somik Das, Senior Power Analyst at GlobalData, said: “EDF renewables has been a key player in the wind sector in the UK, however, it has not performed significantly in the solar PV sector. GlobalData’s figures suggest that more than 800MW of active wind plants are owned by the company in the UK, however, there is a notable abcense of the company in the solar sector. With this initiative, EDF Renewables would be able to strengthen its solar foothold and become a noteworthy player in both areas.”

Looking at ways to expand the current renewables portfolio in the UK, the EDF Group plans to have a 50GW renewables portfolio by 2030 becoming Europe’s market leader in clean energy.

Das concluded: “COVID-19 provided an opportunity to successfully produce electricity by minimizing the use of coal in the generation mix for over a month. It has supported the country’s target of decommissioning coal-based power plants by 2025, which might now be brought a year ahead. This is expected to reduce emissions, which had already seen a drop by 42% last year. EDF’s initiative is likely to aid the cause and help in achieving the country’s net-zero target.”

Transition to renewables ‘to fuel post-COVID recovery’

960 640 Stuart O'Brien

Investment in renewable energy expansion will be an important cog in the wheel towards the post-COVID-19 economic recovery journey.

Expanding the renewables will not only help countries deliver stronger climate action under the Paris Agreement, but also fuel the economic activities across the value chain forming a powerful recovery mechanism to recuperate from the COVID-19 crisis.

That’s according to research from GlobalData, which says due to technological advancements, economies of scale and competitive auctions, the Levelized Cost Of Electricity (LCOE) for renewables has seen steep decline. For example, the LCOE of solar PV had witnessed a drop of 86% to reach 0.05USD/kWh in 2019 when compared with 2010. Likewise, for onshore wind the drop was 50.0% to 0.05USD/kWh.  

The declining LCOE has brought the renewable at par with fossils and in some countries even cheaper. This trend of cost competitiveness and innovation is likely to continue and could attract countries and investors to increase their renewable appetite. For instance, 2019 saw the highest solar power capacity additions and also the highest investment in the offshore wind segment. 

However, the planned investments in this sector until 2030 is lesser than the investments made in the last decade. The COVID-19 pandemic recovery stimulus provides an excellent window of opportunity for governments to channelize their investments in the renewables to offset the silos in the future investment schedule. These were earlier unable to reach the desired  2030 installations target decarbonizing the economy and putting forward a strong step towards climate sustainability. 

Somik Das, Senior Power Analyst at GlobalData, said: “ During the COVID-19 pandemic, renewable energy took the center stage. With declining electricity demand, utilities focussed on generating electricity from cost-effective renewable sources. By the end of 2030, the cumulative renewable installed capacity is estimated to be 3,600GW, about 1,900GW more than that of 2020, which is substantially lower than the required built-up of about 2,800-3,000GW for limiting the global temperature rise by 2c.  

“Incorporating higher investments in renewable energy might provide an opportunity to increase the investments and make up for the shortfall in the required installed power capacity by 2030. 

“Hence, increased investments in renewable energy in the recovery packages would benefit greatly and usher in a multitude of economic benefits. Not only it will provide a better opportunity in addressing climate change goals and global warming issues but also creates new jobs and stimulate economic activities.”  

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