Worldwide renewable energy capacity rises 10% in 2022: What you need to know about the global energy transition this week
- This weekly round-up brings you the latest developments in the global energy sector.
- Top energy news: Global renewable energy capacity up 10%; World carbon allowance sales at record high; German gas shortages loom this winter.
- For more on the World Economic Forum’s work in the energy space, visit the Shaping the Future of Energy, Materials and Infrastructure Platform.
1. Worldwide renewable energy capacity rises 10% in 2022, but much more is needed
Global renewable energy capacity increased by 9.6% last year, the International Renewable Energy Agency (IRENA) says. Wind and solar power accounted for 90% of the net additions, and almost half of the new capacity was added in Asia.
The additions lifted total renewable energy capacity to 3,372 gigawatts (GW) at the end of last year, which was 295 GW higher than the previous year. China was the largest contributor, with 141 GW.
Renewables in Europe and North America grew by 57.3 GW and 29.1 GW respectively, while the Middle East recorded its highest increase in renewables on record, with 3.2 GW of new capacity commissioned in 2022, an increase of 12.8% from the previous year.
"This continued record growth shows the resilience of renewable energy amidst the lingering energy crisis," IRENA Director-General Francesco La Camera said. "But annual additions of renewable power capacity must grow three times the current level by 2030 if we want to stay on a pathway limiting global warming to 1.5°C.”
A new report from the UN's Intergovernmental Panel on Climate Change says emissions must be halved by the mid-2030s if the world is to have any chance of limiting temperature rise to 1.5°C above pre-industrial levels.
2. Record $63 billion raised from carbon allowance sales in 2022
Governments around the world raised a record $63 billion from the sales of carbon allowances in 2022, up by around $4 billion from 2021, as increasing numbers of countries or regions have increased their ambitions to cut pollution.
Many countries and regions have launched emissions trading systems (ETS) to put a price on carbon dioxide emissions and incentivize companies to invest in low-carbon technology.
A total of 28 ETS programmes are in operation globally, covering around 17% of global emissions. Under an ETS, governments set a gradually decreasing cap on the amount of emissions that a sector, or group of sectors, can produce. They create carbon allowances for those emissions, which are auctioned, and companies must buy one for each tonne of CO2 they emit.
Prices in the EU ETS, the world’s most established scheme, rose to an average of $83 a tonne last year, up from $65 in 2021, a report showed. In China’s ETS, the average allowance price was $8 in 2022, up from $7 in 2021, while California and Quebec’s linked ETS price rose to $28 from $21 in the same period.
3. News in brief: More energy stories from around the world
Germany’s energy watchdog expects companies and households will need to cut their gas usage further to avoid shortages next winter, The Financial Times reports. Germany was, until recently, hugely dependent on Russian pipeline gas, and this coming winter will be its first without these supplies.
Africa’s biggest ever renewable energy deal closed this week. Infinity Power has taken a 100% stake in wind power platform Lekela Power. The company aims to install and operate 2 gigawatts of new wind power projects by 2025, which would more than double its current portfolio.
Europe is aiming to boost its carbon dioxide storage capacity, under proposed new legislation. The Net Zero Industry Act would target 50 million tonnes a year of CO2 storage capacity by 2030.
How is the World Economic Forum driving the energy transition?
The World Economic Forum’s Platform for Shaping the Future of Energy, Materials and Infrastructure works across six industries: electricity, oil and gas, mining and metals, chemicals and advanced materials, engineering and construction, and advanced energy solutions. It enables government and business to work together to accelerate the transformation of energy, materials and infrastructure systems.
- In collaboration with Accenture, the Forum is implementing a toolbox of solutions and city sprints to boost sustainability and reduce emissions in urban settings, through the Net Zero Carbon Cities programme.
- The Fostering Effective Energy Transition report summarizes insights from the Energy Transition Index in an effort to assist the world in readiness for energy transition.
- The Mobilizing Investment for Clean Energy in Emerging Economies initiative enables collaborative actions to scale clean energy finance in emerging and developing markets.
Contact us for more information on how to get involved.
And EU countries have reached a preliminary agreement to reduce greenhouse gas emissions in the maritime sector by increasing the use of renewable fuels on ships.
China will launch a pilot scheme to promote the development of renewable energy in rural areas. Provincial-level governments will have to identify potential sites for renewable energy projects The scheme targets at least 30% of total primary energy consumption coming from renewable sources.
Switzerland-based commodity trading house Mercuria is launching a “nature-based solutions business” as it looks to become more involved in the voluntary carbon offset market, reports The Financial Times. The platform will help fund projects that plant trees, counter deforestation and support biodiversity and sustainable forest management.
Lithium-air batteries may be a step closer to replacing lithium-ion batteries, with US scientists developing a lithium-air battery that could significantly increase the driving range of electric vehicles. The battery has a solid electrolyte instead of the typical liquid version used in lithium-ion batteries, and this can increase energy density by 300%, Energy Monitor reports.
Research and development work for Italy’s first major recycling plant for lithium batteries is getting under way. Enel Group’s subsidiary Enel X and automotive storage manufacturer MIDAC are collaborating on the project.
The US is assessing potential interest from countries and corporate backers in its “Energy Transition Accelerator” (ETA) as it looks to help finance moves by poorer nations away from fossil fuels. The ETA would allow regional or state bodies to earn carbon credits by decarbonizing their power sectors.
Saudi Arabian utility developer ACWA Power has agreed to develop solar and battery storage projects in Uzbekistan. The developments could offset 16 million tonnes of carbon dioxide emissions a year.
Saudi Arabian mining company Ma’aden has agreed to supply blue ammonia to Japanese industrial and trading conglomerate Mitsui. It will make it the first commercial supplier of blue ammonia to Japan this year. Blue ammonia is low-carbon ammonia made using natural gas feedstocks and carbon capture.
A European Sovereignty Fund could aid the EU in its aim to be a leading growth region for green technology, as the bloc makes efforts to compete with the US and China. "If we want to be competitive, we need European added value and scale," European Economic Commissioner Paolo Gentiloni said.
Oil prices have fallen sharply amid declining European banking shares and after the US Energy Secretary said that refilling the country's Strategic Petroleum Reserve (SPR) may take several years. "The lack of crude buying for the SPR represents a major blow to the oil demand outlook," PVM Oil analyst Stephen Brennock told Reuters.
4. More on energy from Agenda
Predicted climate change risks will actually have a bigger impact at lower temperatures than previously thought, according to the latest Intergovernmental Panel on Climate Change report.
The global transport system accounts for 15% of global greenhouse gas emissions. Here are five major shifts that could drastically reduce emissions.
Businesses in advanced markets have already begun to act on sustainability initiatives, but those in emerging economies need to close the gap. This blog outlines how they could do it.
To learn more about the work of the Energy, Materials, Infrastructure Platform, contact Ella Yutong Lin: email@example.com