Solar power grew faster than any other fuel in 2016 for the first time, with a 50 percent increase in solar power capacity, according to the International Energy Agency's latest renewables market analysis and forecast.
The Paris-based IEA said on Wednesday that China accounted for almost half of the global expansion of solar power.
Renewables accounted for almost two-thirds of net new power capacity around the world last year, with almost 165 gigawatts (GW) coming online, according to the EIA.
The agency predicted that renewables will continue to have strong growth in the coming years. They predict that by 2022, renewable electricity capacity should increase by 43 percent.
"We see renewables growing by about 1,000 GW by 2022, which equals about half of the current global capacity in coal power, which took 80 years to build," said Dr. Fatih Birol, the executive director of the IEA. "What we are witnessing is the birth of a new era in solar PV. We expect that solar PV capacity growth will be higher than any other renewable technology through 2022."
This year's renewable forecast is 12 percent higher than last year, the EIA said.
China, India and the United States will account for two-thirds of global renewable expansion by 2022. Total solar PV capacity by then would exceed the combined total power capacities of India and Japan today.
- Power generation
In power generation, renewable electricity is expected to grow by more than a third by 2022 to over 8,000 terawatt-hours, which is equivalent to the total power consumption of China, India and Germany combined. By then, renewables will account for 30 percent of power generation, up from 24 percent in 2016.
The deployment in solar PV and wind last year was accompanied by record-low auction prices, which fell as low as $0.03 cents per kilowatt-hour (KWh).
Low announced prices for solar and wind were recorded in a variety of places, such as India, the United Arab Emirates, Mexico and Chile.
These announced contract prices for solar PV and wind power purchase agreements are increasingly comparable or lower than the generation cost of newly-built gas and coal power plants.
- China leader of renewables
China is leading the renewable electricity capacity expansion over the forecast period with over 360 GW of capacity coming online, or 40 percent of the global total.
China's renewables growth is largely driven by concerns about air pollution and capacity targets that were outlined in the country's 13th five-year plan to 2020. In fact, China already exceeded its 2020 solar PV target three years ahead of time and is set to achieve its onshore wind target in 2019.
There are two important challenges for further capacity increase in renewables - the growing cost of renewable subsidies and grid integration issues.
"Under an accelerated case - where government policy lifts barriers to growth - IEA analysis finds that renewable capacity growth could be boosted by another 30 percent totaling an extra 1,150 GW by 2022 led by China. Solar PV and wind capacity in China could by then reach twice the total power capacity of Japan today," the EIA said.
By Huseyin Erdogan