New REN21 report on development of renewables in 2021

At the end of March, the international energy policy network REN21 published a 312-page report on development of renewable energy in the world in 2021. The greatest success for renewables in 2021 was in the power sector. During a year of economic recovery, a record 314.5 GW of new renewable power capacity was added. The global installed renewable power capacity reached 3,146 GW, a record high. The biggest success stories are solar PV and wind. Together, these two sources accounted for nearly 90% of all new renewable power additions.

However, the deployment of new renewables lags behind the growth in energy demand (about 20% per decade). This leads to increasing consumption of fossil fuels. Therefore, the share of renewable energy in world energy production has increased only slightly over the past 10 years, from 10.6% to 11.7%, while the share of fossil fuels has decreased only from 80.1% to 79. 6%. As a result, a rebound in economic activity led to a 6% increase in CO2 emissions in 2021 (the largest increase in global CO2 emissions in history). While US$ 366 billion was invested in renewable energy during the year, fossil fuel subsidies alone reached US$ 5.9 trillion, equivalent to US$ 11 million per minute. The direct and indirect fossil fuel subsidies make 7% of global gross domestic product (GDP).

In 2021, for the first time, solar and wind power provided more than 10% of the world’s electricity. Together with hydropower, renewables generated 28.3% of global electricity in 2021, up from 20.4% in 2011. Hydropower still comprised most of this, although generation from wind and solar power has risen dramatically in recent decades.

Electricity generation by hydroelectric power plants is the only area where Russia continues to be in the top five. The share of China in hydro electricity production is about 30% of the world production. It is followed by Brazil (~9%), Canada (~7%), USA (~7%) and Russia (~4%). Both in terms of renewable energy production and deployment of new renewable energy capacity, China ranks first in most areas.

The installed capacity of solar power plants (SPP) in the world by the end of 2021 increased by 175 GW (by 23%), reaching 942 GW. China is leading here with 54.88 GW of new PV installations, reaching 306 GW. In Russia, 0.233 GW of new SPPs were installed in 2021, which gave 2 GW of total installed SPP capacity.

The global wind power industry continued to accelerate in 2021. Approximately 102 GW of new capacity was installed, bringing the total installed capacity of wind farms to 845 GW. The figure below shows development of wind energy in the top 10 countries. The yellow color shows the installed capacity of wind farms for 2020, and the orange color shows the new capacities commissioned in 2021.

The installed capacity of wind farms in Russia almost doubled compared to 2020, amounting to more than 2 GW. In 2021, more than 1 GW of capacity was put into operation in the country.

Worldwide, the capacity for geothermal direct use – direct extraction of geothermal energy for thermal applications – totalled an estimated 35 gigawatts-thermal (GWth) in 2021. The estimated 2021 annual capacity increase is 2.5 GWth. Geothermal energy use for thermal applications grew 12.8 TWh during 2021 to an estimated 141 TWh. The largest applications for geothermal heat are bathing and swimming (44% of the total in 2019 and growing around 9% annually) and space heating (39% in 2019, growing at 13%). The Figure below shows geothermal direct use for top 10 countries and rest of the world in 2021.

Heating and cooling in buildings is the overlooked giant in the energy transition. Using renewables to heat and cool our homes remains vastly underprioritised. Energy use in buildings accounts for around one third of global final energy demand, yet renewables are progressing only slowly in the sector. In 2019, renewables accounted for 14.7% of energy use in buildings, representing only a 4 percentage-point increase from a decade before.

France is the world leader in the share of RES use in this sector (about 25% of RES). It is followed by Canada (~21%), Italy (~20%), Germany (~19%) and China (~15%). The share of RES in this sector in Russia is negligible.

Energy use for transport accounts for around one-third (31.9%) of global final energy consumption  in 2019, with road transport representing the bulk of the sector’s energy demand (74%), followed by aviation (12%), maritime transport (9.4%) and rail (2%). At the same time, transport remains the sector with the lowest share of renewable energy use (only 3,7%). Between 2009 and 2019, the use of renewable energy in transport grew 87%. However, its overall share in the sector increased by only around one percentage point, from 2.4% to 3.7%, due to continued growth in transport energy use. The main share of this is biofuels (3.3%), and electricity from RES accounted for only 0.4%.

Electric car sales reached 6.6 million in 2021, more than doubling from 2020 and tripling from 2019. The market share of electric cars in overall car sales grew from only 2.5% in 2019 to nearly 9% in 2021. Most of the growth was in China, where electric car sales nearly tripled in 2021 to reach 3.4 million. By year’s end, an estimated 16 million electric cars were on the world’s roads, comprising around 1% of the global car fleet. The chart below shows the EV fleet growth and sales share in the top markets.

In Russia, measures of state support for construction of renewable energy sources are in force. The Ministry of Energy expects that 6.7 GW of renewable energy-based capacity will be commissioned in the Russian Federation by 2035. Presently, according to the Association for the Development of Renewable Energy, the renewable energy capacity (without hydroelectric power plants) is 5.3 GW, which is 2.1% of the capacity of the Russian energy system.

According to the Strategy for the socio-economic development of the Russian Federation with low greenhouse gas emissions until 2050, in order to implement the target (intensive) scenario of the Strategy, it is necessary, in particular, to “significantly increase generation based on renewable energy sources while ensuring the necessary level of localization of equipment production in the territory of the Russian Federation in compliance with the principles of environmental responsibility, including in the extraction of rare earth metals”, as well as “stimulating the equipping of buildings with installations that use and produce renewable energy (solar collectors for hot water supply, photovoltaic panels for electricity generation, heat pumps, apartment and communal sewage heat recovery units, food waste grinders for further processing into biogas at treatment facilities, etc.).”

The Energy Strategy of the Russian Federation for the period up to 2035 notes that “the main problem in the use of renewable energy sources in the Russian Federation is their lack of economic competitiveness in relation to other technologies for producing electrical energy.” In particular, the Strategy states that “the implementation of spatial priorities of the state energy policy involves ... increasing sustainability and reliability of energy supply to macroregions with the maximum, cost-effective use of local energy resources, renewable energy sources and distributed generation.”

Renewables grew enormously in 2021 worldwide. However, the trends remain far from the deployment needed to keep the world on track to reach net zero emissions by 2050. The slow progress in energy conservation, energy efficiency and renewables prevents the transition away from fossil fuels that is necessary to meet global energy demand and reduce greenhouse gas emissions. To reach the average milestones set by major net zero scenarios, annual renewable power additions must triple (adding around 825 GW each year until 2050). A structural shift in the energy system is increasingly urgent. An energy-efficient and renewable-based economy is a game changer for a more secure, resilient, low-cost – and sustainable – energy future.