Coronavirus fallout to slow global growth in renewable energy

Katie Ramirez
May 22, 2020

Along with financial challenges, this decline in renewable energy additions is due to delays in construction activity, supply chain disruptions, lockdown measures and social distancing guidelines.

It means the influential agency is now forecasting growth for both 2020 and 2021 at 10 per cent lower than its projections prior to the pandemic outbreak, stunting the rollout of clean energy just as the world needs to ramp up its decarbonisation efforts in pursuit of the Paris Agreement goals. A partial recovery is expected next year, IEA said.

As a result, 2021 is forecast to nearly reach the level of renewable capacity additions of 2019.

It point to more "challenging conditions" in summer as the share of rooftop solar PV output might increase, leading to potential curtailment of renewables, but it notes that the crucial ancillary services normally provided by fossil fuel generators could be provided by solar PV and wind by implementing operational changes.

Renewable capacity additions this year are set to total 167 gigawatts (GW), 13% less than last year, according to the IEA's Renewable Market Update report.

The IEA also predicted a "rebound" in 2021, nearing 2019 levels, as most of the projects delayed this year come online.

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"Solar Photovoltaics (PV) and wind account for 86 percent of global renewable capacity additions this year, but their annual expansion is forecast to decline by 18 per cent and 12 per cent respectively compared to 2019", the report read. Large-scale solar PV projects are expected to rebound in 2021, but overall installations are unlikely to surpass 2019 levels.

Despite the demand for renewable energy, Birol urged governments to keep sight of the "essential task of stepping up clean energy transitions to enable us to emerge from the crisis on a secure and sustainable path". The impact of the crisis on offshore wind deployment is set to remain limited in 2020 and 2021, since offshore projects have longer construction periods than onshore ones.

IEA said renewables had already been facing challenges at the start of the year in several markets in terms of financing, policy uncertainty and grid integration, with Covid-19 now "intensifying those concerns". "But continuing cost declines will not be enough to protect renewables from a range of uncertainties that are being exacerbated by COVID-19", said Dr Birol.

Global electric vehicle (EV) sales are expected to grow in 2020, despite the pandemic-hit auto industry.

This comes as Australia says its Covid-19 recovery plans will focus on supporting fossil fuel investment and infrastructure, and as key regulatory bodies announce delays to new rules and regulations that could remove barriers to new renewable and other smart technologies.

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