Solar power could be leading 80% of the growth in electricity generation over the next 10 years.
It is now steadily cheaper to generate electricity by capturing the sun’s energy than by burning coal or natural gas, The International Energy Agency said.
The Paris-based agency further added that solar energy is now one of the cheapest sources of electricity in history thanks to developing technologies that have reduced the cost of investments. Photovoltaic systems can be installed as panels on homes or businesses, as well as deployed at solar parks.
The time coming for renewable sources of power generation shines bright, with solar leading the charge, as fossil fuels face a declining future.
Electricity costs from large-scale solar photovoltaic plants have fallen roughly 82 percent from 2010 to 2019, according to the International Renewable Energy Agency.
IEA executive director Fatih Birol says that he is seeing solar becoming “the new king” of the global electricity market.
IEA’s report lays out three scenarios for the future development of global energy markets. In one scenario, where the covid-19 pandemic is brought under control and global energy demand returns to its pre-pandemic level by early 2023, solar capacity grows by an average of 12% a year to 2030. Renewables contribute 80% of the growth in global electricity generation becoming the primary means of producing electricity, overtaking coal by 2025.
For a low-carbon future providing clean power is critical. Therefore electricity is expected to contribute to an increasing share of overall energy consumption.
According to the IEA, even in a scenario in which the pandemic continues on, solar power remains the most cost-effective choice.
Solar performs even more strongly in the IEA’s “Sustainable Development Scenario,” views increase in clean energy policies and investment to reach the aims of the Paris Climate Agreement. 8% of global solar and wind generation in 2019 rises to almost 30% in 2030.
Birol emphasizes that to overcome the world’s climate change governments and investors need to increase their clean energy efforts rapidly.
Some oil companies such as BP (BP) and Royal Dutch Shell (RDSA) are looking forward to major strategic shifts towards low-carbon energy. A sign that the pandemic is bringing profound changes to global energy markets.
Governments response to today’s challenges will determine how fast the climate goals are met, the report draws further attention.
The decline in coal, which has been the backbone of global energy generation for decades, is another reason for the rapid rise in solar power.
The IEA report expects 275 gigawatts of coal-fired capacity to be retired by 2025. The pandemic resulted in a strong decrease in economic activity and electricity demand.
Coal’s shares fall globally from 37% to 28% in 2030, even if the global economy recovers from the pandemic next year.
The report says that coal demand in future economies falls to half by 2030, due to the expected rise of renewables plus cheap natural gas.
Coal’s eventual end seems to be sooner as the cost of solar is constantly declining. The International Renewable Energy Agency said in June that solar prices could go down 42% next year compared to 2019, more than a fifth cheaper than coal-fired plants.