Global Energy Landscape

The global energy landscape has historically been dominated by fossil fuels, which account for approximately 84% of global energy consumption. Despite this dominance, there is a growing consensus on the urgent need to transition to renewable energy sources to mitigate climate change and ensure a sustainable future. The Paris Agreement, adopted by 196 countries in 2015, aims to limit global temperature rise to well below 2°C above pre-industrial levels, signalling a worldwide shift away from fossil fuels toward renewable energy.

Renewable energy sources such as wind, solar, and hydro are projected to account for nearly 30% of the world’s electricity by 2023, up from 24% in 2017. This transition is driven by technological advancements, supportive policies, and the decreasing cost of renewable energy technologies. According to the International Renewable Energy Agency (IRENA), the cost of energy from utility-scale solar photovoltaics (PV) fell by 85% between 2010 and 2020, making it one of the most cost-effective sources of energy today .

The International Energy Agency (IEA) reports that achieving net-zero emissions by 2050 will require annual investments in clean energy of around $4 trillion by 2030. This significant investment is essential to meet the growing energy needs and to transition the power sector from fossil fuels to low-carbon renewable energy. The IEA also emphasizes that renewable energy sources are expected to account for nearly 90% of the increase in total power capacity worldwide by 2021, with solar PV alone representing more than half of this growth.

Energy Poverty and the Paris Agreement

Energy poverty remains a critical issue, with approximately 789 million people lacking access to electricity globally as of 2017. Energy poverty is particularly severe in developing nations, where infrastructure is often inadequate, and investments in renewable energy are crucial to improve energy access and reliability. The United Nations Sustainable Development Goal 7 (SDG 7) aims to ensure access to affordable, reliable, sustainable, and modern energy for all by 2030. Achieving this goal requires innovative financing mechanisms and substantial investments in renewable energy projects.

The Paris Agreement has been a catalyst for increased investment in renewable energy. It encourages countries to develop and implement policies that support the deployment of renewable energy technologies. For instance, countries like China, Japan, the United States, Germany, and the United Kingdom have become leaders in photovoltaic installations, accounting for 80% of all installations in 2014. These efforts are complemented by public-private partnerships (PPPs), which leverage private sector expertise and capital to accelerate the development of renewable energy projects.

Renewable Energy Trends

Renewable energy adoption is accelerating globally. Solar photovoltaics (PV), wind energy and energy storage systems to harness the electricity created are at the forefront of this growth due to significant cost reductions and technological improvements. The cost of solar PV has fallen by 82% since 2010, making it competitive with traditional energy sources in many regions. Wind energy has also seen a 39% cost reduction over the same period. These trends are supported by favourable policies and increasing investments in renewable energy infrastructure.