IEA report tracks downward curve in renewables

PARIS, France, 2004-06-09 (Refocus Weekly)

Renewables still have a “long way to go” before they can play a key role in the world’s energy mix, says the head of the International Energy Agency.

“Renewable energy shows great potential for contributing to the solution of some of today’s energy security and environmental challenges, but more attention must be paid to what is really happening with renewable energy policies and markets, with particular consideration given to cost-effectiveness,” says Claude Mandil. His new report, ‘Renewable Energy - Market & Policy Trends in IEA Countries,’ documents the experience of IEA countries since the oil crises of the 1970’s and provides statistical data on 100 specific markets and 400 policies that IEA countries have established.

The overall share of renewables in total primary energy supply in IEA countries increased from 4.6% in 1970 to 5.5% in 2001, with most increases between 1970 and 1990 of 2.8% a year. From 1990 to 2001, hydro, bioenergy and geothermal grew more slowly and, as a result, green power dropped from 24% of the world’s total generation in 1970 to 15% in 2001.

Solar and wind generation grew by 18% a year from 1970 to 2001, and the last decade has seen a 20% annual increase, “but these renewables have started from a very low level and are concentrated in just a few countries,” and their rapid growth “does not compensate for the slower growth of mature renewables.” In 2001, 86% of installed wind capacity was in Denmark, Germany, Spain and the U.S., with 85% of installed solar PV capacity in Germany, Japan and the U.S.

“Our commitment to renewables should be more widely shared,” says Mandil. Renewables received only 7.7% of total government energy RD&D funding from 1987 to 2002, with solar PV receiving 2.7%, wind 1.1% and bioenergy 1.6%.

“As a percentage of total RD&D funding, renewables have received less since 1987 than in the earlier period of 1970 to 1986,” he says. “The declining share of public funding for energy RD&D allocated to renewable energy appears to be inconsistent with the political intentions of many IEA countries to increase the share of renewables in TPES.”

Significant market growth is the result of combining policies rather than single policies, the report explains, with Spain supporting wind technology by feed-in tariffs, low-interest loans, capital grants and local support for turbine manufacturers. In Japan, PV is supported by extensive RD&D investments to increase competitiveness, demonstration projects, financial incentives and net metering rules.

“Even if such policies prove to be successful in expanding market share, renewables face the challenge of their integration into conventional markets and technical infrastructures,” such as the intermittency of wind and solar, and seasonal dips for hydro and biomass. Renewables must achieve cost-competitiveness with fossil fuel and nuclear technologies, but Mandil says the challenge is to determine “what level and length of support is appropriate” to ensure technologies are developed.


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