Renewables experienced yet another year of record growth in power capacity, despite aftershocks from the pandemic and a rise in global commodity prices that upset renewable energy supply chains and delayed projects. The role of renewables in improving energy security and sovereignty by replacing fossil fuels became central to discussions, as energy prices increased sharply in late 2021 and as the Russian Federation’s invasion of Ukraine unfolded in early 2022. Investment in renewable power and fuels rose for the fourth consecutive year, reaching USD 366 billion, and a record increase in global electricity generation led to solar and wind power providing more than 10% of the world’s electricity for the first time ever. Strong market rebounds for solar thermal and biofuels, following declines in 2020, improved the outlook for renewables in heating and transport. Strengthened political commitments and rapid growth in sales of heat pumps and electric vehicles also led to increased renewable electricity use in these sectors. At the same time, diverse factors continued to slow the global shift to renewable-based energy systems. A rebound in worldwide energy demand, which increased an estimated 4% in 2021, was met largely with coal and natural gas and led to record carbon dioxide emissions (up 6%, adding more than 2 billion tonnes). Large sums also continued to be invested in and to subsidise fossil fuels, with the USD 5.9 trillion in subsidies spent in 2020 equivalent to roughly 7% of global gross domestic product.

POWER During a year of tentative economic recovery, the renewable power sector took a large step forward, deploying a record amount of new capacity and experiencing greater geographic diversification.58 However, projects continued to be disrupted by supply chain issues and shipping delays, and a global rise in commodity prices led to surging prices for wind and solar power components.59 Renewable power capacity additions grew 17% in 2021 to reach a new high of more than 314 GWi of added capacity, driven by the record expansion in solar PV and wind power.60 (p See Figure 5.) Worldwide, the total installed renewable power capacity grew 11% to reach around 3,146 GW.61 However, these trends remain far from the deployment needed to keep the world on track to reach net zero emissions by 2050. To reach the average milestones set by the IEA’s Net Zero scenario by 2050, and by the World Energy Transitions Outlook scenarios from the International Renewable Energy Agency (IRENA), the world would need to add 825 GW of renewables each year until 2050.62(p See Figure 6.)

Renewable Energy Indicators 2021

POLICY LANDSCAPE In the past decade, interest in a global transition to an energy system that relies more heavily on renewables has increased, in response to wide-ranging goals related to climate change and decarbonisation, energy security, job creation, equity and energy access. To achieve these goals, decision makers at various levels have enacted new renewable energy policies and strengthened existing ones.1 Policy support for renewables – whether directly through, for example, renewable energy mandates and incentives, or indirectly through measures such as carbon pricing and fossil fuel bans – remains critical for driving the energy transition, particularly in harder-todecarbonise sectors such as heating in buildings, as well as the transport and industry sectors. By the end of 2021, nearly all countries worldwide had implemented at least one regulatory policy in direct support of renewablesi (p See Figure 14.) Although most of this activity continued to focus on the power sector, the number of renewable energy policies in both transport and heating increased for the first time since 2018 (albeit with weaker policy frameworks).3 In addition to policy developments at the national level, cities increasingly have passed policies in support of renewables, although these are not the focus of this analysis. (p See the Renewables in Cities chapter for a discussion of policy developments at the city level.)

MARKET AND INDUSTRY TRENDS Bioenergy involves the use of many different biological materials for energy purposes, including residues from agriculture and forestry, solid and liquid organic wastes (including municipal solid waste and sewage), and crops grown especially for energy.1 Use of these feedstocks can reduce greenhouse gas emissions by providing substitutes for fossil fuels when providing heat for buildings and industrial processes, fuelling transport and generating electricity.2 Coupled with carbon capture and use/storage, bioenergy can lead to additional emission reductions and even negative emissions.3 When sustainable, the production and use of bioenergy can help promote energy security and price stability while delivering social and economic benefits that support the achievement of the United Nations Sustainable Development Goals, including stimulating rural economic activity.4 However bioenergy can pose sustainability risks if projects are not managed carefully, and strong governance frameworks are essential to ensure positive outcomes.5 Other barriers to bioenergy deployment include its relatively high costs, as well as challenges related to market access.6 Bioenergy use worldwide totalled an estimated 44 exajoules (EJ) in 2020 (latest available data), or around 12.3% of global total final energy consumption (TFEC).7 (p See Figure 24.) More than half of this (24.1 EJ) was the traditional use of biomassi for cooking and heating in developing and emerging economies (6.7% of TFEC).8 Other, more modern and efficient uses of bioenergyii provided an estimated 20.3 EJ or 5.6% of TFEC.9 Overall, bioenergy represented around 47% of the estimated renewable energy use in global TFEC in 2020, down from 54% in 2010.

Many biomass feedstocks can be used to produce electricity. Around 82% of bioelectricity is produced from solid feedstocks such as wood and forestry products (including wood pellets), agricultural residues (notably sugarcane bagasse, used for 10% of global generation) and municipal solid waste (12%).82 These fuels are combusted, and the heat is used to drive steam turbines to produce electricity. Where possible the overall efficiency can be increased by using CHP systems with the heat used on site (for example, in industry) or transported for use elsewhere in district heating systems or sold for use as process heat by other companies.83 In 2019, 16% of all bioelectricity was produced from feedstocks converted to biogas or biomethane (p see Box 7) and around 1% from liquid biofuels.84 Global bio-power capacity and generation both increased significantly during 2011-2021 and were not impacted greatly by the pandemic in 2020, with generation protected by long-term power purchase contracts.85 Global capacity more than doubled during the period, reaching an estimated 158 gigawatts, while global generation rose 88% to 656 terawatt-hours (TWh).86 (p See Figure 27.) Since 2017, China has been the top bio-power producing country, followed (in 2021) by the United States, Brazil, Germany, Japan, the United Kingdom and India.

DISTRIBUTED RENEWABLES FOR 04 ENERGY ACCESS In 2019, an estimated 756 million people worldwide did not have access to electricity. The number of people without access fell significantly in the last decade, from 1,153 million in 2010 to 759 million in 2019.2 However, the COVID-19 pandemic slowed global progress in reaching universal electricity access, as a decline in new grid and off-grid connections led to a 2% increase in the population without access in 2021.3 (p See Snapshot: Chad.) The greatest change occurred in Asia, where the gap in electricity access shrank four-fold over the decade (while it increased slightly in sub-Saharan Africa).4 Most world regions enjoy electricity access rates above 94%.5 Sub-Saharan Africa remains the region with the lowest access rate, at 46% in 2019, representing 570 million people who lack access.6 Most of the gap in electricity access can be attributed to 20 countries where population growth has outpaced the electrification rate, including the Democratic Republic of the Congo (DRC), Ethiopia and Nigeria.7 Access remains lower in rural areas (640 million without access) than in urban areas (116 million).8 In 2019, around 2.6 billion people worldwide did not have access to clean cooking. Annual growth in access is slow, averaging 1% for the decade, and the target for universal access to clean cooking by 2030 may fall short by 30%.10 In 2019, for the first time, sub-Saharan Africa was home to more people without access to clean fuels and clean cooking technologies than any other region.11 More than 80% of the access gap in clean cooking is concentrated in 20 countries, with the largest gaps (access rates of 5% or below) in the DRC, Ethiopia, Madagascar, Mozambique, Niger, Tanzania and Uganda.

INVESTMENT FLOWS Global new investment in renewable power and fuels (not including hydropower projects larger than 50megawatts, MW) reached a record high in 2021, at an estimated USD366billioni.This was a 6.8% increase over 2020, due largely to the global rise in solar photovoltaic (PV) installations. Investment in renewable power and fuels has exceeded USD250billion annually for eight consecutive years.3 (p See Figure 53.) These estimates do not include investment in renewable heating and cooling technologies, for which data are not collected systematically. Solar PV and wind power continued to dominate new investment in renewables, with solar PV accounting for 56% of the 2021 total, and wind power for 40%.4 The strong growth in solar PV investment in 2020 expanded further in 2021, rising nearly 19% to reach USD205billion.5 Wind power investment fell 5% to USD147billion, reflecting a sharp decline in offshore wind power investment (down 45%) and a smaller increase in onshore wind power investment (up 16%).6 Investment in other renewable energy technologies, including biomass, waste-to-energy, geothermal power, and small hydropower, declined overall.

RENEWABLES IN CITIES In 2021, climate and energy action in cities was shaped by tumultuous global events. COVID-19 restrictions remained in place throughout the year, keeping most cities (as well as countries) focused on rebuilding the economy and protecting public health. At the same time, concerns about rising energy prices and their effects on city budgets and municipal utilities elevated the importance of a stable and affordable energy supply on the policy agenda.1 Driven by these trends – as well as by growing climate concern, rising air pollution and public pressure – cities increased their commitments towards net zero emissionsi and renewable energy action, particularly in advance of the November 2021 UN climate talks in Glasgow (Scotland).2 City governments used a broad range of targets, policies and actions to show local commitment to renewables. By the end of 2021, around 1,500 cities had renewable energy targets and/ or policies, up from around 1,300 the previous year.3 This meant that, collectively, more than 1.3 billion people – around 30% of the urban population – were living in a city with a renewable energy target and/or policy (up from 25% in 2020).4 (p See Figure 63.) City governments also have taken action that indirectly supports the shift to renewables, such as setting net zero targets and targets for electrifying heating, cooling and transport.

Some municipal governments have provided fiscal and financial support for the purchase of biofuel or electric vehicles, in some cases targeted at taxi fleets and delivery companies. For example, several of China’s major cities are providing a direct purchase subsidy for zero-emission vehicles, in addition to lower parking fees and subsiding the use of charging infrastructure.124 Such policies were implemented in Chongqing, Guangzhou, Shenzhen, Shijiazhuang and Zhengzhou during 2020 and 2021.125 The most widespread policy support is measures that enable wider transport decarbonisation, such as low-emission zones, bans and restrictions, improving access to charging infrastructure as well as preferential parking. By the end of 2021, 270 cities had established low-emission zones (up from 249 cities in 2020) and 20 had passed bans and restrictions on certain (fossil) fuels or vehicle types (up from 14 in 2020).126 As of early 2022, heavy vehicles are banned from entering downtown Gateshead and Newcastle (both UK) and Hamilton (Canada).127 In 2021, Petaluma (California) became the first US city to ban the construction of new gas stations, driven by its carbon neutral goal and a desire to tackle air pollution and environmental concerns.


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