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Renewables to account for 90% of total global power capacity increases in 2021-2022

Oil&Gas Materials 11 May 2021 15:47 (UTC +04:00)
Renewables to account for 90% of total global power capacity increases in 2021-2022

BAKU, Azerbaijan, May 11

By Leman Zeynalova – Trend:

The exceptional level of renewable energy capacity additions is expected to be maintained, with 270 GW becoming operational in 2021 and 280 GW in 2022, Trend reports citing the International Energy Agency (IEA).

This expansion exceeds the record-level annual capacity additions of 2017-2019 by over 50 percent, such that renewables are expected to account for 90 percent of total global power capacity increases in both 2021 and 2022.

Although the amount of annual wind capacity additions is expected to decrease in 2021-2022 after the exceptional jump last year in China, 80 GW of annual installations are still anticipated globally, i.e. almost 35 percent more than in 2019. Continuous growth in solar PV additions, spurred by lower investment costs and ongoing policy support, partly compensates for lower wind capacity additions. We expect annual solar PV expansion to reach 145 GW in 2021 and 162 GW in 2022, breaking records and accounting for almost over 55 percent of all renewable energy expansion this year and next. The acceleration of hydropower additions through 2022 is driven by the commissioning of mega-scale projects in China. Meanwhile, expansion in other renewables, led by bioenergy, remains stable and represents 3 percent of total new renewable capacity additions.

Despite declining electricity demand and wholesale power price drops due to the impacts of pandemic, governments around the world auctioned a record amount of renewable energy capacity, awarding almost 75 GW of onshore wind, offshore wind, solar PV and bioenergy last year – 20 percent more than in 2019. Auctions held in 2020 (and 2019) remain the main basis of our forecast for 2021 and 2022, in addition to FIT and net-metering policies for smaller applications. India and China together auctioned almost 55 GW of wind and PV capacity at average contract prices of USD 60/MWh for wind and USD 47/MWh for PV.

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Follow the author on Twitter: @Lyaman_Zeyn

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