Additions of renewable electricity capacity will decline by 13 percent in 2020 compared with 2019, the first downward trend since 2000, Trend reports with reference to the International Energy Agency (IEA).
This is a 20 percent downward revision compared to the agency’s previous forecast in which 2020 was due to be a record year for renewable power.
The update reflects both possible delays in construction activity due to supply chain disruptions, lockdown measures and social‑distancing guidelines, and emerging financing challenges. The outlook also takes into account ongoing policy uncertainty and market developments such as the most recent auctions and newly financed projects before the Covid-19 outbreak.
However, the majority of these delayed projects are expected to come online in 2021 and lead to a rebound in capacity additions, IEA believes.
As a result, 2021 is forecast to almost reach the level of renewable capacity additions of 2019. Despite the rebound, the combined growth in 2020 and 2021 is almost 10 percent lower compared to the previous IEA forecast.
The IEA forecast expects 167 GW of renewable capacity to become operational in 2020. Solar PV accounts for half of this renewables expansion, but its additions decline from 110 GW in 2019 to over 90 GW in 2020.
New PV installations are expected to see a partial rebound in 2021, owing to utility-scale projects that return to 2019 addition levels, while distributed PV is hit more severely and does not fully recover. Onshore wind installations are also affected by commissioning delays, although they are mostly compensated for in 2021 as the majority of projects in the pipeline are already financed and under construction. However, forecast uncertainty remains for projects that were planning to achieve financial close in 2020 and become operational next year. The commissioning of two mega hydropower projects in China in 2021 supports the overall rebound of renewables.
Overall, the updated forecast revises down combined capacity growth in 2020 and 2021 by almost 10 percent. The drivers behind this revision vary by technology and country (details in the technology sections). The distributed PV forecast is revised downwards by the largest proportion, almost 36 percent, mainly in Europe, China and the United States.
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