IEA: Global renewable capacity to double. Renewables to overtake coal

The International Energy Agency expects global installed renewable energy capacity to more than double over the next five years. The agency says this despite the sector facing supply chain tensions, challenges integrating renewables into the grid, financial pressures and policy changes.

Global installed renewable capacity will grow by 4 600 GW by 2030, according to the International Energy Agency. To put that in perspective, this is roughly equivalent to the combined total installed power generation capacity of China, the European Union and Japan.

The agency expects renewable electricity generation to rise from 9 900 TWh to 16 200 TWh by 2030. Renewables are also expected to overtake coal by mid-2026 at the latest, becoming the world's largest source of electricity generation.

Political and market barriers have nevertheless led the organisation to cut its global forecast by 5% compared with last year, equivalent to 248 GW. The main reasons cited are weaker prospects in the United States and China.

Renewables growth will slow in the US and China, while India and the EU gain ground

In the US, the downward revision is mainly due to the early cancellation of federal tax incentives and other regulatory changes, which have led the IEA to cut its US growth expectations by almost 50%.

Meanwhile, China’s shift from a country that regularly breaks records in renewable energy development from fixed tariffs to auctions is reducing project economics, resulting in a 5% cut to the forecast.

Developments in China and the US are partly offset by growth elsewhere. Renewable energy development is set to accelerate in India, which will become the second-fastest-growing market after China and is on track to comfortably meet its 2030 target. Auctions, faster permitting and the expansion of rooftop solar power plants are helping drive this growth.

Europe’s outlook has also improved thanks to ambitious policies, larger auction volumes and simplified approval processes, while many emerging economies in Asia, the Middle East and Africa are accelerating construction as costs fall and targets rise, the report says.

Solar takes the lead

Solar power plants will account for the lion’s share of the overall increase in installed capacity, representing about 80% of the growth.

IEA Executive Director Fatih Birol urged policymakers to address supply chain security and grid constraints, which are pushing down the forecast for offshore wind development. The forecast is a quarter lower than last year’s.

Generation from pumped-storage hydropower plants is expected to grow 80% faster over the next five years than in the previous five, as challenges in integrating renewables into the grid increase. Geothermal power plants are on track to reach record highs in the United States, Japan, Indonesia and other emerging markets.