However, other clean energy technologies will need to ramp up if the world is to limit global warming to below 2C from pre-industrial levels, analysts have warned.
As the cost of wind and solar PV undercuts that of coal and gas plants, more renewable energy will be rolled out, BloombergNEF (BNEF) forecasts.
Already, more than two-thirds of the world’s population live in countries where wind or solar PV are now the least expensive option of new power-generating capacity, according to the New Energy Outlook 2019 report.
By 2030, the energy generated or stored and dispatched by solar, wind and lithium-ion batteries will undercut electricity generated by existing coal and gas plants almost everywhere, lead analyst on the report, Matthias Kimmel, noted.
Costs and investment
The levelised cost of wind is expected to drop 48% by 2050, reaching around $30/MWh. Meanwhile, solar PV costs are expected to fall by 63% to around $25/MWh and battery prices are due to drop 64% to $62/kWh over this period.
By 2050, 15.15TW of new power capacity will be commissioned, of which 80% will be zero-carbon, BNEF’s analysts predicted. This marks a near-tripling of global generating capacity between 2018 and 2050.
Wind power capacity will increase six-fold, while its share of global generation will rise from 5% today to 26% by 2050.
Meanwhile, solar PV’s expected fourteen-fold growth in capacity will boost its share of generation from 2% to 22% during the same period.
This new capacity will help to meet a 62% increase in electricity demand between 2018 and 2050, BNEF stated.
Wind and solar will attract the lion’s share of the $13.3 trillion expected to be spent on new power generation assets by mid-century.
Wind power will receive $5.3 trillion of investment by 2050, while $4.2 trillion will be spent on solar PV.
Additionally, $840 billion will be invested in battery technology, and $11.4 trillion will be spent on grid expansion.
Plugging the gap
With help of batteries, wind and solar will be capable of providing about 80% of electricity in some countries, BNEF forecasts.
However, these three technologies will struggle to provide more than 80%, and therefore other technologies such as nuclear, biogas-to-power, hydrogen-to-power and carbon capture and storage, will be needed to plug the deficit.
BNEF’s director of the New Energy Outlook, Seb Henbest, said governments need to ensure their markets are friendly to the expansion of wind, solar and battery storage technology.
Governments should also back research and deployment of these other technologies, he said.
The projected growth of renewables through to 2030 indicates that many countries can follow a path that is compatible with keeping the increase in world temperatures to 2C or less – as outlined in the 2015 Paris Climate Agreement, BNEF noted.
This can be achieved without introducing additional direct subsidies for existing technologies such as solar and wind, the analysts added.
BNEF forecast the fastest grid decarbonisations will take place in Europe, where renewables will supply 92% of the power by 2050.
Europe will be trailed by the US, with its abundance of low-priced natural has, on 43% by mid-century, and China, where emissions will peak in 2027 while renewables achieve 37% penetration on the grid.