New York, December 20: Solar power is becoming the cheapest form of electricity production in the world, according to new statistics from Bloomberg New Energy Finance (BNEF). Solar power, for the first time, is becoming the cheapest form of new electricity. These are the latest findings of Climatescope, the annual clean energy country competitiveness index by Bloomberg New Energy Finance with support from the UK and U.S. governments, which provides the clearest picture yet of clean energy activity in 58 emerging markets in Africa, Asia, and Latin America and the Caribbean.
Developing countries have taken a crucial lead over developed economies in clean energy development, adding 18% more renewable energy generation capacity than wealthier nations, and with four in five having set national clean energy targets in the run up to UN-sponsored climate negotiations in Paris.
2016 marked the first time that the renewable energy source has out-performed fossil fuels on a large scale and new solar projects are also turning out to be cheaper than new wind power projects, BNEF reports. In 2015, for the first time, countries outside the Organization for Economic Cooperation and Development (OECD) invested more in renewable energy and added more renewable capacity than the 15 OECD countries combined.
China tops the list among the developing countries to power itself entirely on clean energy
The cost of solar in 58 developing nations dropped to about a third of 2010 levels, with China adding it to the record number of solar projects. The world is adding more capacity for clean energy each year than for coal, natural gas, and oil combined. Peak fossil fuel use for electricity may be reached within the next decade.
Developing countries are at the forefront of this advancement, having invested in clean energy economies to kick off the catastrophic effects of climate change at a greater rate than wealthy nations. According to the BNEF’s report, Climatescope, ranks and profiles emerging markets for their ability to attract capital for low-carbon energy projects. The top-scoring markets were China, Chile, Brazil, Uruguay, South Africa, and India.
"Solar investment has gone from nothing—literally nothing—like five years ago to quite a lot," said Ethan Zindler, head of BNEF's U.S. policy analysis.
As you can see, after some fluctuations, non-OECD countries pushed ahead last year. It might hit around another year or two, but the longer term trend is clear: The center of clean-energy gravity is moving south. And it’s almost entirely due to China. The country installed 142 GW of new power generation capacity in 2015, of which 33 GW was wind and 18 GW was solar PV.
These numbers might hit around for a few years, but renewable-energy investment in non-OECD countries is headed up, whereas investment in developed nations seems to have increased.
If this spread out, global average temperatures will exceed 2 degrees, possibly even 3 or 4. To stop short of 2 degrees, global coal use will need to be close to zero by 2040, with oil not far behind. Emerging nations, like their OECD counterparts, are moving in the right direction, but too slowly.
More than three quarters of Climatescope countries had set emissions reductions and clean energy targets by year-end 2015, up markedly from 2013 when 18% had such goals and just half had set clean energy deployment objectives. Developing countries, China and India especially, greatly contributed to the successful ratification of the Paris Agreement at the 21st meeting of the parties to the United Nations Framework Convention on Climate Change (UNFCCC) in December 2015. Every one of the 58 Climatescope countries with the exception of Nicaragua was a Paris signatory as of Q3 2016.
The buildup of wind and solar takes time and fossil fuels remain the cheapest option for when the wind doesn’t blow and the sun doesn’t shine. Coal and natural gas will continue to play a key role in the alleviation of energy poverty for millions of people in the years to come. But for populations still relying on expensive kerosene generators, or who have no electricity at all, and for those living in the dangerous smog of thickly populated cities, the shift to renewable and increasingly to solar can’t come soon enough. Wind is still cheaper in many OECD nations, including the U.S. That is largely an issue of sunshine and wind availability in the respective regions.
According to Climatescope, sudden solar equipment cost declines are catalyzing build and driving growth. Investment in utility-scale solar in Climatescope nations spiked 43% to USD 71.8 billion in 2015. Tenders held for power-delivery contracts have highlighted that photovoltaic’s (PV) that can now compete against and beat fossil-fuelled projects on price in some nations. New players focused on “off-grid” or “mini-grid” solutions are challenging the assumption that only an expanded hub-and-spoke power grid can meet the needs of the world’s 1.2 billion with inadequate access to power.