Photovoltaics Will Be The Main Installed Source in The World in 2027, According To The IEA

The International Energy Agency has published its report "Renewables 2022", in which it shares its forecasts on the deployment of renewable energy technologies in the electricity, transport and heating sectors until 2027 based on current policies and the market evolution; while exploring the main challenges of the sector and identifying the barriers that prevent faster growth.

According to the Agency, we are experiencing "the first truly global energy crisis, triggered by the Russian invasion of Ukraine", which "has given an unprecedented boost to renewable energy". Thus, "disruptions in the supply of fossil fuels have highlighted the advantages of domestically generated renewable electricity for energy security, which has led many countries to strengthen their policies to support renewable energy," he explains. . In addition, as an addition, "the increase in the prices of fossil fuels around the world has improved the competitiveness of solar photovoltaic and wind generation compared to other fuels".

“The biggest upward revision in our history”

As a result, the expansion of renewable capacity in the next five years will be much faster than expected just a year ago, and in the period between 2022-2027, renewables will grow by almost 2,400 GW according to the main forecast. of the IEA, which represents an acceleration of 85% with respect to the previous five years and almost 30% more than anticipated in last year's report. In addition, it makes it "the largest upward revision in our history."

Renewables will account for more than 90% of the expansion of global electricity capacity during the forecast period, and will take place mainly in China, the European Union, the United States and India.

Electricity from wind and solar photovoltaic sources will more than double in the next five years, contributing nearly 20% of global electricity generation by 2027. These variable technologies account for 80% of the global increase in renewable generation over the period of forecasting, which will require additional sources of flexibility of the electrical system.

The sun, in the lead

The installed capacity of photovoltaic solar energy will surpass that of coal in 2027, and will become the largest in the world. Cumulative solar PV capacity nearly triples in the IEA forecast, growing by almost 1,500 GW over the period, surpassing natural gas in 2026 and coal in 2027.

Annual additions of solar PV capacity will increase each year for the next five years, and it does so despite higher current investment costs due to high commodity prices. Distributed solar generation will also grow.

Spain will add 58 GW renewables

Our EU renewable capacity growth forecast has been revised upwards significantly (by 30%) compared to last year's report, led by Germany (up 50%) and Spain (up 60%). Cumulative renewable electricity capacity in Europe is expected to increase by almost 60% (+425 GW) between 2022 and 2027, more than double that of the previous five-year period (2016-2021).

Photovoltaic solar energy leads the growth, followed by onshore wind, offshore wind, bioenergy and hydroelectric. In addition, three quarters of the European expansion is concentrated in seven countries: Germany, Spain, the United Kingdom, Turkey, France, the Netherlands and Poland.

“Policy efforts are making hydrogen production from wind and solar photovoltaics a new growth area,” says the IEA.

The Agency expects installed renewable electricity capacity in Spain to nearly double by 2027, as competitive auctions, corporate PPAs and commercial projects add 58 GW of solar PV, onshore wind and pumped hydro. This year's forecast has been revised upwards 63% to reflect a more optimistic outlook for solar PV.

REPowerEU is not met

"Our main forecast does not reach the modeled objectives of the REPowerEU plan for all sectors," explains the Agency, detailing that, in order to achieve them, the EU Member States would be required to reduce the deadlines for granting permits and licences, extend the auction systems with clear calendars, redesign auctions to reflect the rising cost of renewable energy and its benefits for energy security, and improve incentive systems for distributed photovoltaic solar generation.

"In our main scenario, the share of renewable energies in the energy demand for transport goes from 9% in 2020 to 15% in 2027, which is not in line with the EU's aspirations for 2030", explains the Agency. .

On the other hand, heating with renewables is growing, but not enough to contain the use of fossil fuels: the consumption of renewables for heating is expected to increase by almost a third, from 11% in 2022 to 14% in 2027. No However, the annual increase in the share of renewables would have to almost quadruple the historical and projected growth to be in line with the objectives of the REPowerEU plan.