- IRENA’s full World Energy Transitions Outlook Report suggests making renewables-based energy systems mainstream as the only pathway to limiting global warming to 1. 5°C By 2050
- Renewables will offer employment to 48 million out of 122 million energy related jobs in 2050
- Policy support is crucial for a just and swift energy transition to renewables
In March 2021, the International Renewable Energy Agency (IRENA) offered a preview of its World Energy Transitions Outlook report, stressing that enhancing renewable energy capacity of the world 10-fold, from 2,800 GW in 2020 to a cumulative of 27,700 GW by 2050—reaching 14,000 GW of installed capacity for solar PV, and 8,100 GW for wind energy— would be one major contributor for the world to ensure 1.5°C limit to global warming by 2050 (see IRENA Expects 14,000 GW Solar PV By 2050 In New Report). That would mean for renewables annual additions of 840 GW, up from 264 GW in 2020
On June 30, 2021, it released the full report offering the world a pathway to reach 1.5°C seeing renewables-based energy systems ‘instigating profound changes that will reverberate across economies and societies’. IRENA’s Director-General Francesco La Camera said, “There is consensus that an energy transition grounded in renewables and efficient technologies is the only way to give us a fighting chance of limiting global warming by 2050 to 1.5°C. As the only realistic option for a climate-safe world, IRENA’s vision has become mainstream.”
However, it would all depend on policy makers to eliminate market distortions favoring fossil fuels, phase out fossil fuel subsidies and facilitate necessary changes in funding structures.
A renewables-based power structure will create up to 122 million energy related jobs in 2050, up from 58 million now, out of which 48 million alone will be in the renewables space. This would support the world’s recovery post-COVID and support long-term economic growth, according to the report writers. IRENA suggests an annual clean energy investment of $4.4 trillion on an average, which though high would be feasible and equals to around 5% of global GDP in 2019.
Solar PV and wind energy among renewables will be crucial to this transition, since the impact of COVID-19 on these power generation technologies has been much smaller than anticipated. In the pandemic impacted year of 2020, wind energy installations added up to 111 GW and solar PV 127 GW, showing their resilience and momentum.
Renewable energy at a massive scale will not only enable transition to clean energy, but would also encourage innovation and bring about several technological avenues to reach climate targets, provided these are supported with targeted policies and measures.
Some of the major points covered in the report include:
- By 2050, the world would need around 5,000 GW electrolyzer capacity to serve as seasonal storage and decarbonize other industries. Renewables will power 2/3rd of the total hydrogen in 2050; and unambiguously IRENA sees 1/3rd will be blue hydrogen produced by natural gas.
- The world would need a total of $33 trillion of additional investments into efficiency, renewables, end-use electrification, power grids, flexibility, hydrogen and innovations.
- Payback will be higher when decrease in air pollution would better human health and hold climate change.
- Private sector will grow from 44% in 2019 to 57% in 2050 thanks to planned policies geared towards energy transition offering them a ‘big business opportunity’.
- Public financing will be crucial for a ‘swift, just and inclusive’ energy transition and to catalyze private investment, especially in developing markets. It should grow to some $780 billion under 1.5°C scenario, growing from $450 billion in 2019.
The authors of the report caution that if the energy transition is not well managed, it risks inequitable outcomes, dual-track development and an overall slowdown in the progress. Just and integrated policies will remain imperative to realize the full potential of the energy transition.
The report can be accessed for free on IRENA’s website.
In June 2021, another IRENA report claimed solar PV generation costs dropped 7% annually in 2020, and that new renewable power generation capacity costs less than even existing 800 GW coal-fired capacity (see RE Promises Major Cost Savings To Pursue Net Zero Aim).