G20 Summit: Promise to triple global renewable energy capacity by 2030 a significant step, but with challenges

Incidentally, tripling of renewable capacities was also among the lowest-hanging fruits available to the G20 grouping on the climate front, despite some initial reservations from traditional fossil fuel producing countries like Russia and Saudi Arabia. Renewable energy is already being deployed at a rapid pace across the world, with the annual capacity additions growing by around 10 per cent every year. And though the push, no doubt, came from the developed countries, there is no inherent objection to the deployment of renewable energy from the developing countries. For countries like India and China, the growth of renewable energy is also the most preferred way to contribute to the global fight against climate change, and bring down the role of fossil fuels in their economies.

Source: IRENA

Tripling of capacities within seven years is an ambitious task, nonetheless. The current global installed capacity of renewable energy is just short of 3,400 GW. In 2022, about 295 GW of new capacity was added, the highest ever. To triple the total capacity by 2030, the world would have to add nearly 1,000 GW of new capacity every year. That is what agencies like the International Renewable Energy Agency (IRENA) or International Energy Agency (IEA) and climate activists and civil society organisations have been pushing for.

“Tripling renewable capacity by 2030 is an ambitious, yet achievable goal. Annual capacity additions have more than doubled from 2015 to 2022, rising by about 11 per cent per year on average. Just a slightly higher annual growth rate would put renewables on track to meet the 2030 capacity target,” the IEA said in a recent assessment. It acknowledged that a higher annual growth rate would require much stronger policy push from the governments.

“It is the single most important lever to bring about the reduction in carbon dioxide emissions needed by 2030. Expansion at that speed would allow renewable power generation growth to outpace total electricity demand, which is expected to increase strongly in the coming years – supported by the electrification of energy systems, the increasing use of cooling as temperatures climb, and robust demand growth in emerging and developing economies,” IEA said.

“Tripling renewable capacity by the end of the decade would also lead to unabated coal-fired power generation, the single largest source of energy-rated CO2 emissions, dropping by half between 2022 and 2030,” it said.

But the key to achieving this target would be the mobilisation of adequate financial resources and creation of opportunities — infrastructure, policy environment, skill development — in countries with low penetration of energy access. As part of their climate action plans, about 135 countries have promised to create or enhance their renewable energy capacities, but as of now most of the new capacity additions is happening in a handful of large developing countries. India and China together account for more than 50 per cent of global capacity additions in each of the last five years. In 2022, out of the 295 GW of additional capacity installed throughout the world, China alone added 140 GW, or nearly 48 per cent.

Source: IRENA

The tripling target cannot be achieved without the rapid growth in demand from other developing countries, mainly in Africa. The addition of African Union in the G20 is expected to provide the right impetus for a greater penetration of renewable energy in these countries since this is a G20 commitment right now. But it is very likely that this commitment is adopted by the COP28 climate change meeting in Dubai this year, in which case it will have global ownership.

It is here that a multilateral body like the International Solar Alliance (ISA) has a crucial role to play. Solar energy constitutes more than 50 per cent of new renewable energy capacity additions every year and is pivotal to the growth of renewables. In 2022, out of the 295 GW of new renewable capacity created, 191 GW, 65 per cent, came from solar energy. The ISA was created specifically for the purpose of rapidly scaling up the deployment of solar energy across the world, but it is still to realise its full potential.

Ajay Mathur, director general of ISA, acknowledged that the big growth in solar utilisation was still to come.

“Through the year, the International Solar Alliance has worked with the G20 Presidency towards fast tracking development, in the G-20 countries and globally, while also mitigating climate change by promoting solar utilization. This can be done in three ways. First, we need to build the knowledge and capacity of all countries to produce, transport and use low and zero carbon hydrogen. ISA has launched the Green Hydrogen Innovation Centre to enable this action,” Mathur said.

“Second, we need to enable solar mini grids to provide universal energy access, especially where grid extension is too expensive. Guarantees help in crowding-in private sector investment into solar mini grids. We are proud to provide such a guarantee to our member countries in Africa. And the third action is to build entrepreneurs in these countries who can, with help, become the Amazons of tomorrow, supplying solar energy across countries and regions. We have recently identified, and are strengthening, 20 solar startups in Africa. We now look at the Asia & Pacific Region, and then the Latin America & Caribbean region,” he said.

“The work is huge, and the time to accomplish it is short. We need new partnerships – between International Organizations and countries, and in between International Organizations as well, to accelerate solarization. The International Solar Alliance stands in support of the world to accelerate solar deployment for mitigating climate change,” he said.

The other big challenge, of course, is the availability of financial resources. According to an IRENA outlook, investments of about 5.3 trillion USD would be required per year, not just till 2030 but till 2050, to enable the energy transition that will limit the global rise in temperatures to within 1.5 degree Celsius from pre-industrial times.

“Global investment across all transition technologies reached a record high of 1.3 trillion USD in 2022. Yet annual investment would need to more than quadruple to remain on the 1.5°C pathway,” IRENA said in a recent report.

But even if the tripling target is achieved by 2030, it alone would not be sufficient for the 1.5 degree Celsius goal. According to current projections, the greenhouse gas emissions in 2030 would exceed the 1.5 degree Celsius compatible levels by about 24 billion tonnes of CO2 equivalent. Renewable energy, if tripled, would be able to avoid only 7 billion tonnes of CO2 equivalent, or less than one third of what is required.

It is for this reason that many climate observers were disappointed with the G20 outcome. The G20 meeting skirted most of the contentious issues — greater emission cuts, phase-out of fossil fuels, massive mobilisation of financial resources — and stuck to previously-stated positions. G20 is not the forum where climate decisions are taken. That is the job of the year-ending climate change conferences called COPs. But with their heft and influence, G20 countries certainly have the ability to galvanise global action. That is what it has decided to do with the promise on the renewable energy side.