Driven by dramatic growth in solar generation, renewables will overtake coal as the world’s primary means of generating electricity by 2025, the International Energy Agency (IEA) has forecast.
The agency’s annual World Energy Outlook, released today, projects, based on policy intentions and previously announced targets, that solar and wind power will produce nearly 30% of the world’s electricity by 2030. That’s up from just 8% in 2019.
With a pipeline of new installations, renewables will also hold 80% of the market for new power generation by that date.
Simultaneously, demand for coal power will likely never recover to pre-pandemic levels and by 2040 will fall to less than 20% of the global energy mix for the first time since the Industrial Revolution.
Demand for natural gas will also taper off in developed nations, especially in Europe. In the UK, the National Grid Electricity Systems Operator (ESO) has forecast that the power grid will have its first gas-free hours by 2025.
And it’s solar power that will be the “new king of the world’s electricity markets,” IEA Executive Director Fatih Birol said.
Maturing technology and new support mechanisms have slashed the costs of financing solar PV projects, bringing down overall output costs. In most countries, solar PV is now cheaper than new coal- or gas-fired power plants.
Boosted by low costs, worldwide solar photovoltaic (PV) capacity will grow by an average of 12% a year throughout the next decade, setting new records for deployment every year after 2022, the report forecasts.
However, hydroelectric plants will continue to be the largest source of renewable power globally.
Despite the surge in renewable generation, achieving net-zero greenhouse gas emissions by 2050 will still be a massive challenge, complicated by the coronavirus pandemic.
“To reach net-zero emissions, governments, energy companies, investors and citizens all need to be on board—and will all have unprecedented contributions to make,” the report states.
“There’s a lot of work to be done,” Birol said.
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