Triple renewables target within reach after energy surge – plus other top energy stories

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Roberto Bocca, Head of Centre for Energy and Materials; Member of the Executive Committee, World Economic Forum

• This round-up brings you key stories from the energy sector over recent weeks.
• Top energy stories: 2030 renewables target in reach following China surge; Electricity consumption by data centres set to double; 10 important questions for a just energy transition.
• For more on the World Economic Forum’s work in the energy space, visit the Energy, Materials and Infrastructure Platform.

1. Triple renewables goal within reach

The world has a “real chance” of achieving the goal of tripling renewable energy capacity agreed at COP28, but will need to go even further to achieve this target, the International Energy Agency (IEA) has said.

In its latest annual renewables report, the agency reveals the world added nearly 510 gigawatts of renewable energy capacity in 2023 – a 50% increase on 2022.

Europe, the US and Brazil all saw record increases in renewables capacity, but the surge was primarily driven by China, which more than doubled its solar capacity and increased its wind capacity by 66%.

Under existing policies and market conditions, global renewable capacity would reach 7,300 GW by 2028, the IEA explained in its analysis of the findings. At that pace of growth, global capacity would accelerate 2.5 times from current levels by 2030.

IEA Executive Director Fatih Birol said: “The new IEA report shows that under current policies and market conditions, global renewable capacity is already on course to increase by two-and-a-half times by 2030. It’s not enough yet to reach the COP28 goal of tripling renewables, but we’re moving closer – and governments have the tools needed to close the gap.”

He acknowledged there are some “big hurdles” to overcome. These include increasing renewable energy investment and deployment in emerging and developing countries to ensure they are not left behind in the new energy economy.

2. 10 questions for a just energy transition – new Forum research

Equity and inclusivity are essential for a successful energy transition. A new report from the World Economic Forum outlines a framework and 10 critical questions to guide policymakers and business leaders towards advancing a just, equitable and inclusive energy transition.

Topics covered in Building Trust through an Equitable and Inclusive Energy Transition include how to balance local benefits and costs, and what metrics and indicators are needed to measure progress and accountability.

The report follows on from Transforming Energy Demand, a white paper by the Forum outlining actions for businesses and countries to enhance energy management, efficiency and carbon intensity reduction. This prior research also highlights commercially beneficial levers for the energy transition, which can be implemented with existing technologies.

CENTRE: ENERGY AND MATERIALS

How is the World Economic Forum facilitating the transition to clean energy?

3. News in brief: More energy stories from around the world

The European Union’s fossil fuel CO2 emissions hit a 60-year low in 2023, “back to 1960s levels”, the Guardian reports. Analysis from the Centre for Research on Energy and Clean Air shows the bloc produced 8% less carbon dioxide from burning fossil fuels in 2023 than it did in 2022.

India has yet to decide on whether to cut import taxes for electric vehicles. “It’s a very contested area and we’ve not been able to take a final call on this so far,” Rajesh Kumar Singh, a top bureaucrat at India’s Department for Industry and Trade Promotion, told Reuters at the Forum’s Annual Meeting in Davos.

Two major investors in Europe’s energy transition – InnoEnergy, supported by the European Union, and Demeter Investment Managers – plan to raise €500 million ($544.55 million) for a battery raw materials fund. The objective is to address “significant gaps” in the region’s supply chain. The EBA Strategic Battery Materials Fund will strategically target critical minerals, encompassing lithium, nickel, cobalt, manganese, and graphite, they say.

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A surge in demand for artificial intelligence and internet services could see data centre electricity consumption double by 2026, the IEA says. In its Electricity 2024 report, the Agency predicts a rise from 460 terawatt-hours (TWh) in 2022 to more than 1,000TWh in 2026.

The UK government is exploring plans to build a new large-scale nuclear power plant. The leading candidates for the plant’s location would include Wylfa on Anglesey or Moorside in Cumbria, industry sources told the BBC.

Natural gas flow to US LNG export plants was at its lowest for 12 months in the week of 15 January, as an Arctic freeze led some energy firms to divert fuel to the domestic market.

4. More on energy from our blog

‘A Long-Term Strategy for Climate, Nature and Energy’ was a key theme at the World Economic Forum’s 53rd Annual Meeting. This roundup provides the main takeaways from Davos on the topic.

Trillions of dollars will be needed each year to support the decarbonization of emerging economies. Here are four examples of how to mobilize that finance.

At the Annual Meeting 2024, the Network to Mobilize Clean Energy Investment for the Global South was launched to provide a platform for developing economies to raise awareness about their clean energy needs, share best practices and sustainably accelerate their energy transitions, helping to unlock an estimated $2.2-2.8 trillion needed for the energy transition.

The rising cost of the climate crisis is just one of the reasons why 2024 will be a critical year for investment in sustainable office buildings, according to Guy Grainger, the global head of sustainability services & ESG for JLL. Read more of his insights here.