Global renewable electricity capacity will surge by over 920 GW between 2017 and 2022, a rise of 43% on current installed capacity, the International Energy Agency said Wednesday in its annual renewables report.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
According to the IEA's Renewables 2017 report, this year's forecast is 12% higher than last year, due mostly to solar PV revisions in China and India.
Video: German election results bring coal exit, carbon pricing back on agenda
Blog post: Solar to power Middle East oil, natural gas exports
Three countries - China, India and the United States - will account for two-thirds of global renewable expansion by 2022, it said.
"We see renewables growing by about 1,000 GW by 2022, which equals about half of the current global capacity in coal power, which took 80 years to build," IEA executive director Fatih Birol said.
"What we are witnessing is the birth of a new era in solar PV. We expect that solar PV capacity growth will be higher than any other renewable technology through 2022," he added.
In power generation, renewable electricity is expected to grow by more than one-third by 2022 to over 8,000 TWh/year -- equivalent to the total annual power consumption of China, India and Germany combined, the IEA said.
While most of this will remain hydro, its share will be reduced by the growth in wind and solar with wind turbines already generating almost 1,000 TWh of power in 2016 and solar panels adding 312 TWh, IEA 2016 estimates show.
By 2022, renewables will account for 30% of power generation, up from 24% in 2016, it added.
The growth in renewable generation will be twice as large as that of gas and coal combined, the report said.
Record deployment for solar is accompanied by record-low auction prices for solar projects as low as $30/MWh in some regions, the IEA added with onshore wind auction prices also dropping below $50/MWh in some markets.
China remains the undisputed leader of renewable electricity capacity expansion over the forecast period with over 360 GW of capacity coming online, or 40% of the global total, it said.
According to the IEA, China's renewables growth is largely driven by concerns about air pollution and capacity targets that were outlined in the country's 13th five-year plan to 2020.
India's move to tackle grid-integration issues also drives a more upbeat forecast with Indian renewable capacity set to more than double by 2022, overtaking the renewable expansion in the European Union for the first time, it said.
The United States remains the second-largest growth market for renewables despite policy uncertainties at the federal level, according to the IEA's Renewables 2017 report.
The main drivers for onshore wind and solar in the US -- such as multi-year federal tax incentives combined with renewable portfolio standards as well as state-level policies for distributed solar PV -- remain strong, it said.
But current uncertainty over proposed federal tax reforms, international trade and energy policies could alter the economic attractiveness of renewables and hamper their growth over our forecast period.
In the European Union, renewable growth over the forecast period is seen 40% lower compared with the previous five-year period, it said.
Overall, weaker electricity demand and overcapacity remain challenges to growth while limited visibility on forthcoming auction capacity volumes in some markets present a forecast uncertainty, the IEA added.
Beyond 2020, policy uncertainty remains, it said.
But, if adopted, the new EU Renewable Energy Directive for the post-2020 period would address this challenge by requiring a three-year visibility over support policies, improving predictability for investors, the report said.
Europe will remain the third-biggest global market with still some 100 GW to be installed over the 2017-22 period, while declines in Japan and Brazil could see them overtaken by combined additions across Africa and the Middle East, the IEA's regional breakdown shows.
The 189-page report also provides detailed analysis of the renewable consumption of electric cars and off-grid solar deployment in Africa and developing Asia.
Off-grid solar capacity in these regions will more than triple to over 3 GW in 2022, it said, adding that while this represents less than 5% of total solar PV capacity, the economic impact is significant, bringing basic electricity services to almost 70 million more people in developing Asia and sub-Saharan Africa in the next five years.
Power consumption of EVs -- including cars, two- and-three wheelers and buses -- is expected to double over the next five years, with renewable electricity estimated to represent almost 30% of their consumption by 2022, up from 26% currently, it said.
Electric vehicles will play a complementary role to biofuels, which represent 80% of growth in renewable energy consumption in transport, according to the IEA.
But the share of renewables in total road transport energy consumption remains limited, creeping up from 4% in 2016 to almost 5% in 2022, the IEA's Renewables 2017 report said.