Solar Is the Future King of Electricity: IEA

Eighty percent of the demand growth in global electricity over the next decade will be met by renewable sources, according to Paris-based think tank International Energy Agency’s (IEA) Stated Policies Scenario (STEPS) in which COVID-19 is gradually brought under control in 2021 and the global economy returns to pre-crisis levels the same year. This scenario reflects all of today’s announced policy intentions and targets, insofar as they are backed up by detailed measures for their realization.  

Solar is set to become "the new king of electricity," said the organization in its World Energy Outlook flagship publication released today. "Renewables grow rapidly in all our scenarios, with solar at the center of this new constellation of electricity generation technologies. Supportive policies and maturing technologies are enabling very cheap access to capital in leading markets."

Change in global electricity generation by source and scenario, 2000-2040

The report adds that solar PV is consistently cheaper than new coal- or gasfired power plants in most countries, and solar projects now offer some of the lowest cost electricity ever seen. In the STEPS scenario, hydropower remains the largest renewable source of electricity to 2030, but solar is the main driver of growth as it sets new records for deployment each year after 2022, followed by onshore and offshore wind. The Sustainable Development Scenario (SDS), in which the energy system is on track to achieve sustainable energy objectives in full like the Paris Agreement, would see even more spectacular growth of both solar and wind.

Coal demand is not expected to return to pre-crisis levels even in the more likely STEPS scenario, with its share in the 2040 energy mix falling below 20% for the first time since the Industrial Revolution. "The era of global oil demand growth will come to an end in the next decade," said Dr Fatih Birol, the IEA Executive Director. "But without a large shift in government policies, there is no sign of a rapid decline. Based on today’s policy settings, a global economic rebound would soon push oil demand back to pre-crisis levels."