Solar will remain the leading source of global renewable energy capacity expansion by 2023, accounting for 286 GW.
IEA reports
IEA has released an updated market report on the renewable energy market outlook for 2023 and 2024.
That number will grow to nearly 310 GW by 2024, driven by falling solar module prices, increased adoption of distributed PV systems, and a policy push for large-scale power plants.
Roof Solar Power Station
107 GW to 440 GW
Globally, new renewable energy capacity will soar from 107 GW to more than 440 GW by 2023, the largest absolute increase on record, the report said.
Solar will account for 65% of new capacity additions, reaching 286 GW, with distributed generation applications accounting for nearly half of new capacity additions.
Lower module prices, greater use of distributed photovoltaic systems, and government policy push for large-scale photovoltaic systems will trigger higher annual growth in all major markets, including China, the European Union, the United States and India, the IEA said.
Brazil & Europe
However, the agency said that between 2023 and 2024, new capacity additions in Brazil may be reduced due to Law No. 14.300, which entered into force in early 2022, changing the rate of return in the distributed generation market.
Compared with its December 2021 forecast, the agency raised its forecast for renewable energy capacity additions in 2023 and 2024 by 38%.
In the European Union, residential and commercial solar PV systems account for 74% of the expected growth, with 82% of the increase coming from six major markets: Germany, Spain, the Netherlands, France, Italy and Sweden.
The two main trends driving forecast changes are:
- Since 2021, the business case for self-produced energy has become increasingly attractive
- The energy crisis triggered by Russia’s invasion of Ukraine.
PPAs
Competitive auctions are expected to remain the dominant procurement method in Europe, accounting for at least 65% of the growth in renewable energy installations between 2022 and 2024.
PPAs and commercial solar power plants are expected to account for 22% of new energy installations in Europe by 2024. Corporate PPAs led by Spain, Sweden, Germany, the Netherlands and Denmark will account for the majority of unused project share。
While installations developed under full commercial models may be in the minority, PPA projects are expected to increase revenue by incorporating niche business models.
