Energy Watch Group Analysis: IEA Keeps Assuming Linear Growth for Renewable Energy
On October 2, 2015 the International Energy Agency (IEA) launched the Medium-Term Renewable Energy Market Report (MTRMR) 2015 on the sidelines of the G20 meeting in Istanbul.
The report demonstrates a certain effort by the IEA to recognize the relevance of renewable energies for power capacity over the medium term. It also points out that enhanced energy policies will give greater certainty about the long-term revenue streams of renewable projects and can foster their deployment.
The IEA figures reflect reality to a certain extend: in the OECD, renewables account for nearly all net additions to power capacity, compared to fossil fuels and nuclear. In the non-OECD, fossil fuels remain significant but there is large upside potential for renewables.
Yet, IEA projections of renewables expansion and costs remain largely conservative (Figure 34 and 65). Just like the IEA’s World Energy Outlook, this report makes the same error of assuming a linear growth for renewable energy despite the proved exponential growth track in the last decade. Read more on that in the last Energy Watch Group study.
The estimated 429.5 GW global solar PV capacity till 2020 are well below the estimates of Bloomberg New Energy Finance (BNEF) 589 GW, SolarPower Europe (SPE) 606 GW and Greenpeace 732 GW. The WEO 2014 projection on global solar capacity was only 364 GW. (see below 1)
Surprisingly, the report does not show the growth of the PV market in China and no significant market growth in India although both countries adopted 100 GW PV programs till 2020 and 2022 (See Figure 68). This year alone, China has raised its solar power installation target for 2015 by 40 percent.
IEA projects only 45 – 60 GW of global annual solar PV additions in 2020, whereas BNEF estimates 87 GW and SPE about 66 GW. (see below 2) The same concerns the estimates of global cumulative renewable capacity: IEA projects around 700 GW whereas BNEF estimates 1004 GW and Greenpeace 1249 GW.
SUMMARY: The IEA Medium-Term Renewable Energy Market Report (MTRMR) 2015 goes in the right direction, but the wrong assumption of linear growth leads and conservative estimates result in undermining the global renewables energy market growth.
- The market outlook of SPE ends in 2019, therefore a market volume for the year 2020 according to the previous years had been added to get comparable installed capacities for the year 2020.
- The market outlook of SPE ends in 2019, therefore a market volume for the year 2020 according to the previous years had been added to get comparable installed capacities for the year 2020.
