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Climate change
OpinionComment
Ramnath Iyer
Ramnath Iyer

Opinion | How to tackle the challenges facing the global energy transition

  • The adoption of renewables is unequal geographically, investment costs are rising, there is underinvestment in grids and storage, and then there are non-financial barriers
  • Governments must tackle administrative hurdles while investors need to better support green energy development

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Workers carry a solar panel for installation at the Adani Green Energy Limited’s renewable energy park in the salt desert of Karim Shahi village, near Khavda in Gujarat, India, on September 21. Photo: AP
Ramnath Iyer
The growth of renewable energy sources, especially wind and solar, continues apace. At the Cop28 UN climate change conference, countries have pledged to triple the world’s renewable energy capacity by 2030. But there remain substantial challenges to the goal of limiting global warming to 1.5 degrees Celsius above pre-industrial levels.
The good news is that solar and wind power is growing quickly. Though making up just 12 per cent of electricity generated worldwide last year, solar and wind accounted for 80 per cent of incremental power demand. The International Energy Agency’s net zero by 2050 scenario anticipates that solar generation will grow by 25 per cent every year until 2030.

Investments in solar power generation reached nearly US$500 billion last year, an increase of US$80 billion on 2021. Wind investments though, at US$162 billion, fell by 5 per cent. But despite recent cancellations of offshore wind projects, mainly in the United States, 103 gigawatts of wind farm capacity are likely to be established this year, with new investment in renewable energy hitting a record US$358 billion in the first half, up 22 per cent.

Yet challenges remain, in the unequal geographical adoption of renewables, rising cost of investment, underinvestment in supporting infrastructure like grids and storage, and the non-financial barriers that slow the adoption of renewable energy.

The notable rise in renewable energy investment is strikingly unbalanced. Developed economies and China account for more than 80 per cent of the total investment to date in renewables.

China alone contributed 52 per cent of the global investment in clean energy, along with 42 per cent in solar and 55 per cent in wind capacity additions last year. In Asia, only India, South Korea and Vietnam also made the top 10 for renewable capacity additions from 2013 to 2022.

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