New power from wind and solar is set to fall this year for the first time in two decades.
Construction of new wind and solar farms is being delayed by factory closures, workers’ needs for social distancing and developers’ financial concerns as they emerge from the coronavirus crisis, according to research from the International Energy Agency.
The world is set to add 167 gigawatts of renewable power capacity this year, 13 per cent less than in 2019. It’s a reality check for a sector that’s seen only growth for years and has emerged relatively unscathed from the plunge in energy demand that’s hit the oil and gas business.
“The continued decrease in the cost and increasing competitiveness of wind and solar alone will not shelter renewables from the economic downturn,” Fatih Birol, the IEA’s executive director said in a phone interview.
It’s critical that governments step in with support to ensure renewable energy sources continue to grow, he said.
Part of the decline this year will be made up in 2021 as projects that were delayed catch up. While that’ll see the level of new renewable power return to 2019 levels, it’ll still be about 10 per cent below what the IEA had previously forecast for this year and 2021.
A big part of the drop is because of an anticipated decline in smaller-scale solar installations put up on people’s homes and businesses. Those are set to fall by almost 36 per cent this year, mainly in Europe, China and the U.S., as those smaller players cut back on investments.
© 2020 Bloomberg L.P.