New Green Power Growth Commitments Lag Climate Goals

(Bloomberg) -- Commitments for new renewable power capacity are off to a slow start this decade, just as more investment is needed in clean technology to slow down the worst effects of climate change.

Targets set by governments and companies for installations of technologies like wind turbines and solar panels this decade are far below what was built in the previous 10 years, according to research from BloombergNEF for the United Nations Environment Program and Frankfurt School’s UNEP Center published Wednesday.

The pledges by governments and companies for new renewable sources are still set to add up to $1 trillion in investment by 2030, but that pales in comparison with the $2.7 trillion of green power investment actually made in the last decade. However, the amount invested could easily end up being much more as not all renewables installations follow government or corporate targets.

“Clean energy finds itself at a crossroads in 2020,” said Jon Moore, chief executive officer of BNEF. “The last decade produced huge progress, but official targets for 2030 are far short of what is required to address climate change.”

A landmark 2018 UN report said the world must invest $2.4 trillion in clean energy every year through 2035 and cut the use of coal-fired power to almost nothing by 2050 to avoid catastrophic damage from climate change.

The spending commitments will translate to 826 gigawatts of new non-hydro renewable power capacity by 2030 -- some way below the heights reached by 2019.

Governments are spending trillions of dollars to revive economies from the impact of the coronavirus. Some, including the European Union and Germany, have the climate at the center of their plans.

“If governments take advantage of the ever-falling price tag of renewables to put clean energy at the heart of the Covid-19 economic recovery, they can take a big step toward a healthy natural world,” said Inger Andersen, executive director of the UN Environment Program.

Renewable power has never been cheaper. Costs of solar and wind have fallen steadily in the past decade as governments backed green industries and financing costs declined.

Investment in renewables stagnated last year as China and India slowed down their rate of installations.

Still, the percentage of global generation from renewable technologies increased to 13.4% in 2019, from 12.4% in 2018.

One area for growth looks to be offshore wind which had $29.9 billion of investment last year, the highest level ever.

The 19% gain from the previous year was boosted by investments in newer markets such as China and France.

Offshore wind farms have been growing in shallow water and could be rapidly expanded in the coming years thanks to floating technologies that would open up deeper waters to renewable power.

©2020 Bloomberg L.P.