Global renewable energy additions hit a record high, but investment in technology areas still needs strengthening

　On June 7, the 8th Clean Energy Ministerial and the 2nd Mission Innovation Ministerial were held in Beijing. At a side event on "The Status and Challenges of Energy Transition—Global Renewable Energy Development and the Role of Renewable Energy in China's Energy System," the Renewable Energy Policy Network for the 21st Century (REN21) released the 2017 Global Status Report for Renewable Energy (hereinafter referred to as the "Report"), summarizing the global development of renewable energy.

　　Global energy transition has shown results.

　　The Report released by REN21 showcases an ongoing global energy transition: record-breaking additions of renewable energy capacity; rapidly declining costs, especially for solar photovoltaic and wind power; and three consecutive years of decoupling economic growth from energy-related carbon emissions. Through better integration of cross-sectoral planning, the use of exciting new business models, and the creative application of various enabling technologies, innovation and more sustainable ways to meet human energy needs are accelerating the transition from a fossil fuel-dependent world to a renewable energy operating model.

　　The Report shows that in 2016, new renewable energy capacity reached a record high of 161 gigawatts, increasing global total capacity by approximately 9% compared to 2015. Solar photovoltaic power was particularly impressive in 2016, accounting for approximately 47% of new capacity additions, followed by wind power at 34%, and hydropower at 15.5%. This marks the fifth consecutive year that investment in new renewable energy generation capacity (including all hydropower) has been approximately double that of fossil fuel-based generation, reaching $249.8 billion. Currently, the world adds more renewable energy generation capacity each year than the net increase in all fossil fuel capacity.

　　The cost of photovoltaic and wind power generation is declining rapidly. Simultaneously with the record-breaking increase in renewable energy capacity, the global cost of photovoltaic and wind power generation is also declining rapidly.

　　The Report shows that record-low bids have been seen recently in photovoltaic markets in Argentina, Chile, India, Jordan, Saudi Arabia, and the United Arab Emirates, with some countries achieving bid prices below $0.03/kWh. Similarly, many countries have seen new lows in wind power bid prices, including Chile, India, Mexico, and Morocco. Record-low bids for offshore wind power in Denmark and the Netherlands have brought the European offshore wind industry closer to its goal of offshore wind power prices below those of coal by 2025.

　　Meanwhile, the Report emphasizes that the notion that only wealthy countries can afford renewable energy is no longer applicable.

　　The largest additions of renewable energy capacity continue to be in developing countries, primarily in China. For the past eight years, China has been the largest developing country in the field of renewable energy generation and heating. India's solar revolution, along with 48 developing countries committed to 100% renewable energy targets, means that the share of developing countries in global renewable energy capacity will continue to increase. Furthermore, in 2015, developing and emerging economies surpassed developed economies in renewable energy investment for the first time (although developed countries regained the lead in 2016, China remained the largest investor). In many cases, renewable energy electricity is already the lowest-cost option.

　　Investment in renewable energy technologies still needs strengthening.

　　The Report also points out that although new investment in global renewable energy electricity and fuel capacity is approximately double that of fossil fuels, investment in new renewable energy capacity in 2016 still fell by 23% compared to 2015. In developing and emerging markets, total renewable energy investment was $116.6 billion, down 30% from the previous year, while investment in renewable energy in developed countries fell by 14%, totaling $125 billion. Investment continues to flow primarily into wind and solar energy, but further development of all renewable energy technologies is needed if the goal of limiting global warming to 2 degrees Celsius is to be achieved.

　　"We all talk about the need for clean energy innovation, but how does innovation happen? Innovation only happens when money is invested in R&D of clean energy technologies." Fatih Birol, Executive Director of the International Energy Agency, frankly stated that the global energy industry invests over $2 trillion annually, while only $26 billion is spent on R&D. Sadly, the R&D spending of the world's three largest IT companies combined exceeds that of global clean energy R&D.

　　In addition, globally, subsidies for fossil fuels and nuclear power still far exceed those for renewable energy technologies. By the end of 2016, more than 50 countries had pledged to phase out fossil fuel subsidies and implemented corresponding reforms. But this is far from enough. In 2014, the ratio of fossil fuel subsidies to renewable energy subsidies was 4:1, meaning that for every dollar given to renewable energy, governments spent $4 in the fossil fuel sector, thus increasing dependence on it.

　　REN21 Executive Secretary Christine Lins said: "The world is racing against time. To rapidly and cost-effectively reduce carbon emissions, the most important thing we can do is phase out coal and accelerate investment in energy efficiency and renewable energy. The Chinese government's announcement in January this year that it is phasing out 100 coal-fired power plants under construction sets an example for governments, showing that when governments act by establishing clear, long-term policy and financial signals and incentives, change happens quickly."

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