The world’s wind and solar projects have combined to meet more than a tenth of global electricity demand for the first time in 2022, research firm says BloombergNEF (BNEF). At the same time, overall electricity demand, coal-fired power generation and emissions all increased in 2021 as the global economy recovered from the COVID-19 pandemic.
“New peaks in coal production are a worrying sign for the economy, our health and the fight against climate change,” says Michael R. Bloomberg, UN Secretary-General’s Special Envoy for Climate Ambition and Solutions , and founder of Bloomberg LP and Bloomberg Philanthropies. “This report should be a rallying cry for leaders around the world that the clean energy transition requires bigger and bolder actions, including actions that empower nations that have contributed least to climate change – but who bear many of its worst consequences – to move on.
With nearly 3,000 TWh of electricity produced, wind and solar together accounted for 10.5% of global production in 2021, BNEF found in its annual energy transition trends report. Wind’s contribution to the global total rose to 6.8%, while solar increased to 3.7%. Ten years ago, these two technologies combined accounted for well under 1% of total electricity production. In total, 39% of all electricity generated globally in 2021 was carbon-free. Hydroelectric and nuclear projects met just over a quarter of the world’s electricity needs.
Every year since 2017, wind and solar account for the majority of new power generation capacity added to global grids. In 2021, they reached a record three-quarters of the 364 GW of new capacity built. Including hydro, nuclear and others, carbon-free power accounted for 85% of all new capacity added.
“Renewables are now the default choice for most countries looking to add or even replace power generation capacity,” says Luiza Demôro, head of energy transitions at BloombergNEF. “It’s no longer due to mandates or grants, but simply because these technologies are most often the most cost-competitive.”
Solar continued to expand at a particularly strong pace in 2021, both in terms of new capacity additions and new markets. Solar accounted for half of all global capacity added, at 182 GW. Its contribution to global networks exceeded 1,000 TWh for the first time. Solar has also become essentially ubiquitous. In nearly half of all countries tracked by BNEF where some capacity was added, solar was the top choice by volume. At least 112 countries now have at least one MW of installed solar capacity.
Despite the incredible advances in renewable energy, the Power Transition Trends report paints a bleak picture of the enormous work that remains for the power system to cope with its role in climate change. As the global economy recovers from the COVID-19 pandemic, electricity demand jumped 5.6% year-on-year, straining existing infrastructure and supply chains in fossil fuels.
Lower-than-expected output from hydroelectric plants and higher natural gas prices have also helped put coal power back in the spotlight in more markets. The production of coal-fired power stations broke records, jumping by 8.5% compared to 2020-2021 (+750 TWh net), to 9,600 TWh. More than 85% of this generation came from 10 countries, with China, India and the United States alone accounting for 72%.
Meanwhile, countries have continued to complete the construction of new coal-fired power plants in 2021, and coal still accounts for the largest share of global capacity at 27%. One small positive: the rate at which new coal is added to the network is slowing down. Only 13 GW of new coal capacity was completed in 2021, compared to 31 GW in 2020 and 83 GW in 2012.
Nonetheless, the result was a proportional 7% increase in global power sector CO2 emissions in 2021 compared to 2020. Power sector emissions hit a new high of 13,600 megatonnes of CO2, according to BNEF estimates.
“It’s been a year of ups and downs, for the best and the worst reasons,” comments Ethan Zindler, head of the Americas at BNEF. “Renewables have grown very rapidly, but the return of coal and the fact that countries – including those committed to net zero emissions – are continuing to produce coal is truly disconcerting.” BNEF’s Power Transition Trends report was produced in partnership with Bloomberg Philanthropies and will be officially released today at the United Nations Climate Action Forum: The Race to Zero and Resilience in New York. Read the full report here.