Fuelled by surging electricity demand and sinking technology costs, developing nations are today leading a global clean power transition. This marks a remarkable turnabout from a decade ago when the world’s wealthiest countries accounted for the bulk of renewable investment and deployment activity. Developing nations at the time were viewed as holding enormous promise only; wind, solar, geothermal and other clean technologies were regarded as too expensive for mass deployment.
Last year’s Climatescope documented how the locus of clean energy activity had shifted noticeably from “North” to “South”, from OECD to non-OECD countries. This year’s survey goes one step further by illustrating how less developed nations are now very much driving the energy transition.
Leadership is an elusive quality to quantify. Still, this year’s Climatescope offers compelling evidence that developing nations are at the forefront of change toward a cleaner-powered future. Consider:
- In 2017, the large majority of the world’s new zero-carbon power capacity was built in developing countries. A total of 114GW (including nuclear and hydro as well as “new renewables”) was added in these nations, compared with approximately 63GW added in wealthier nations.
- In a first, renewables accounted for the majority of all new power-generating capacity added. Developing countries added 186GW in 2017 to their grids with wind and solar alone accounting for 94GW – just over half.
- Clean energy deployment is growing fastest in developing nations. New-build additions rose 20.4% year-on-year in these countries. By contrast, new build in wealthier nations fell by 0.4%.
- Coal build has fallen sharply in developing countries. After peaking at 97GW of new capacity built in 2015, coal additions slipped to 48GW in 2017. New coal in India has crashed from 17GW per year 2012-16 to 4GW in 2017, suggesting the country is plotting a lower- carbon course to expand energy access.
- Developing countries are driving down clean energy costs, making these technologies more competitive with fossil generation. Over 35 emerging markets have held reverse auctions for clean power-delivery contracts to date, including Mexico ($21/MWh for PV) and India ($41/MWh; wind), procuring 140GW vs. 41GW in OECD countries. BNEF’s estimated levelized cost of electricity for wind and solar is below $50 for many developing nations.
- Clean energy investment is being deployed in more nations than ever. As of year-end 2017, 54 developing countries had recorded investment in at least one utility-scale wind farm and 76 countries had received financing for solar projects. That’s up from 20 and 3, respectively, a decade ago.
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