Renewables will surpass gas and nuclear by 2016. That is the somewhat surprising headline finding of the International Energy Agency’s report published late June. According to the report, renewable power generation will increase by an astonishing 40 per cent in the next five years, making up almost a quarter of the global power mix by 2018.

According to the IEA’s second Medium-Term Renewable Energy Market Report, two main factors are driving this positive outlook for renewable power generation. The first is that investment and deployment are accelerating in emerging markets and the second is the growing need for energy diversification and local pollution concerns.

Certainly evidence of the former is plentiful. One recent example is the latest MENA Renewables Status Report, which found that investment in the renewable energy sector the Middle East and North Africa increased by 40 per cent from 2011 to 2012, despite a worldwide decline over the same period.

It is of no surprise that the IEA expects the majority (two-thirds) of this emerging market growth to come from China. Despite what appears to be a slowing (or it is a rebalancing?) of its economy, China recently announced an ambitious plan to essentially quadruple its installed solar power capacity to 35 GW by 2015. Some arguably cynical reports suggest that this initiative has been devised by Beijing to help soak up the country’s sizeable share of the global glut in solar technology and thereby protect its domestic industry.

Africa also looks set to benefit from renewable energy. On his recent three-country visit US President Barack Obama pledged $16bn of American funding to double Africans’ access to electricity, with a strong focus on renewable energy development. In this issue, we explore what is said to be a renewables boom in sub-Saharan Africa, especially in smaller-scale projects that are helping to bring light to rural communities.

As you’d expect the IEA’s renewable energy report is not all good news, with a slow-down in growth anticipated in more mature markets, most notably Europe and the US. It cautions that renewable energy development is becoming “more complex” and “faces challenges in terms of governmental policy”, especially in a number of European countries. If you are a power generator with a mixed fleet of both conventional and renewable energy you will be all too familiar with these challenges.

You only have to look at some recent headlines to get some idea of the challenges facing those participating in the European renewable sector. For example, Dong Energy recently sold its Danish onshore wind power business as part of a plan to focus solely on offshore wind. This may well be a smart move by the Danish utility in light of the June announcement that the European Union has awarded a welcome £1m in funding towards a detailed study for the ongoing initiative to build an offshore grid between Scotland, Northern Ireland and Ireland.

E.ON, Germany’s largest utility by sales, has withdrawn from the Pelamis marine energy project at the European Marine Energy Centre in Scotland. According to a spokesperson, the decision was taken because of the slow progress in wave technology development and a shift in the utility’s focus towards more mature renewable technologies. Is this an indication that novel renewable and low-carbon technologies with huge potential but little tested will lose out to more conventional renewables in the continuing uncertainty over renewable energy policy?

Furthermore, Germany’s RWE has pulled the plug on its Tilbury biomass-conversion project in the UK, which it started in 2011 and would have made it the largest biomass-only power plant in the world. According to RWE, it decided to halt work on the biomass plant “whilst options on project feasibility are assessed and reviewed”. RWE may well be thanking its lucky stars considering the recent announcement by the British government. It is proposing to cap subsidies for bespoke biomass burning plants to 400 MW per plant and end subsidies by 2027 for existing stations combusting biomass. It does make one wonder what Drax thinks of that, considering its £700 million investment in converting three of its six boilers to 100 per cent biomass.

Renewable power will increase by an astonishing 40 per cent, making up almost a quarter of the global power mix by 2018 and driven by emerging economies

Dr. Heather Johnstone   Dr. Heather Johnstone
Chief Editor
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