The installed capacity of renewable sources worldwide will reach an estimated 2,252.3 GW in 2020, finds a new report from Frost & Sullivan.
The report says the past decade has witnessed massive developments in terms of regulations and markets for renewable energy. While fewer than 50 countries worldwide had renewable support policies in place in the early part of the last decade, this number has now reached over 120. Investments in renewables have also risen dramatically over the past decade.
‘The [European Union] has set binding targets to source 20 percent of the bloc's total energy consumption from renewable energy sources in 2020, and targets for individual member states range from 10 percent for Malta to 49 percent for Sweden,’ says Frost & Sullivan Energy and Environmental Industry Director Harald Thaler. ‘Climate and energy policies – as well as long-term price-based incentives, such as subsidies and tax benefits – can substantially boost renewable energy penetration and innovation.’
While the sector has escaped relatively unscathed from the vagaries of the global economic downturn, the report says the market is beginning to feel the pinch now as investments begin to decline significantly. Frost & Sullivan believes this is also a clear sign of the gradual shift in market power to emerging economies, where economic development and revised energy priorities will drive a more sustained increase in the adoption of wind, solar and biofuel generation technologies.
Urbanization, population growth, and energy security concerns are other key drivers for the rise of renewable energy capacity in emerging regions such as Asia, Latin America, the Middle East and Africa. Further accelerating the uptake of new energy sources in developing countries is the need to diversify to reduce dependence on fossil fuels and the dramatic fall in the cost of renewable energy, the report says.