Renewable energy is booming, but we need more action to double energy efficiency by 2030
The world is on the verge of a historic achievement: meeting one of the main goals of the COP28 climate summit, which is to triple global renewable capacity and double energy intensity improvements by 2030. This would not only help limit global warming to 1.5°C, but also enhance energy security, reduce air pollution, and create millions of green jobs. But to make this happen, governments need to act swiftly and decisively to unlock the full potential of renewable energy.
According to a recent report by the International Energy Agency (IEA), renewable capacity is growing faster than ever, reaching almost 510 gigawatts (GW) in 2023, with solar PV accounting for three-quarters of additions worldwide. The largest growth took place in China, which commissioned as much solar PV in 2023 as the entire world did in 2022, while China’s wind power additions rose by 66% year-on-year. The increases in renewable energy capacity in Europe, the United States and Brazil also hit all-time highs.
Under existing policies and market conditions, global renewable power capacity is now expected to grow to 7 300 GW over the 2023–28 period covered by the IEA forecast, increasing by two-and-a-half times by 2030. This is close to the COP28 goal of tripling renewables, which countries agreed to do at the conference in Dubai in December 2023. Solar PV and wind account for 95% of the expansion, as their generation costs are lower than for both fossil and non-fossil alternatives in most countries and policies continue to support them.
However, the world needs to go further to ensure that the COP28 goal is not only met, but exceeded. The IEA estimates that if governments use various policy tools to boost renewable expansion by 20% more, they can reach the COP28 goal and reduce global energy emissions by 35% by 2030, saving 12.38 billion tonnes of carbon emissions yearly. These policy tools include setting more ambitious targets, providing stable and long-term incentives, streamlining permitting and grid integration processes, and scaling up financing and deployment of renewables in emerging and developing economies.
While tripling renewable capacity is a crucial step, it is not enough to achieve the other COP28 goal of doubling energy intensity improvements by 2030. Energy intensity, which measures the amount of energy used per unit of economic output, reflects how efficiently energy is used in the economy. Improving energy intensity can lower energy demand, reduce emissions, and save costs for consumers and businesses. The IEA reports that the global rate of energy intensity improvement slowed to 0.6% in 2020, down from 1.8% averaged in the decade before, mainly due to the impacts of the Covid-19 pandemic and the shifts in the global economy.
Doubling energy intensity improvements by 2030 is not an easy task, as it requires adding grid-level batteries and upgrading the grid architecture to make it more efficient, as well as implementing stringent standards and regulations for buildings, appliances, vehicles, and industrial processes. The IEA projects that under current policies and market conditions, the global rate of energy intensity improvement will accelerate to 2.4% per year on average from 2021 to 2030, which is faster than the previous decade but still falls short of the 3.4% annual improvement needed to meet the SDG 7.3 target for 2030.
To close this gap, governments need to adopt a comprehensive and holistic approach to energy efficiency, which includes setting clear and measurable objectives, providing adequate funding and incentives, enforcing compliance and monitoring, and fostering innovation and digitalisation. The IEA also recommends that governments align their energy efficiency policies with their renewable energy policies, as the two are complementary and mutually reinforcing. For example, increasing the share of renewables in the power sector can reduce the carbon intensity of electricity, while improving the efficiency of end-use sectors can reduce the electricity demand and ease the integration of variable renewables into the grid.
The COP28 goals of tripling renewable capacity and doubling energy intensity improvements by 2030 are ambitious but achievable, and they offer multiple benefits for the environment, the economy, and the society. The world has a real chance of making them a reality, but it requires strong political will, bold policy action, and sustained public and private investment. The time to act is now, as the window of opportunity is closing fast. The future of our planet and our well-being depends on it.
