Ahead of COP28, which starts this week in Dubai, the European Union and the United Arab Emirates will seek support for the goal of tripling global renewables capacity to 11 terawatts by 2030. According to new research, that goal is not just in reach — it could be achieved solely with solar.
But caveats abound. While solar certainly needs to scale to keep the world on track, analysts warn that relying too heavily on it could hold back the development of other critical energy sources, limiting generation capabilities and ultimately compromising emissions reduction goals.
BloombergNEF’s recent report compares the 2030 goal of tripling renewables to data from its New Energy Outlook net zero scenario, which describes a pathway to meeting Paris Agreement goals. That scenario, last updated in 2022, sees wind and solar combined making up more than three-quarters of total global power generation by 2050.
It found that total renewables generation will need to reach 22,000 terawatt hours by the end of the decade to be on track for the 2050 goal. That represents a 2.6-fold increase over a 2022 baseline, and a three-fold increase needed in renewables capacity — in line with the E.U. and U.A.E. goal.
BNEF projects that for solar to stay on track, it must make up around 5.3TW of the 2030 renewables generation mix globally, a target that BNEF solar analyst Jenny Chase said is not only in sight, but that may well be exceeded based on the current rate of development.
“My team is now forecasting about 5.8 terawatts [by 2030],” Chase told Latitude Media.
“And to be honest, I think our forecasts are fairly conservative,” she added. “Forecasting solar is hard, but it does consistently outperform reasonable expectations.”
The rate at which solar deployment has increased in the last decade — 27-fold growth between 2010 and 2022 — surprised pretty much everyone, Chase said. Annual solar investments in 2022 are already at the levels required to meet end-of-decade goals. And, according to BNEF models, the existing factory base for solar is “more than sufficient” to meet near-term projections, which means solar supply chains don’t need to scale-up as dramatically as other renewables like wind must.
Solar can essentially “keep doing more or less what it’s been doing,” Chase said.
In the United States, for example, solar has outpaced all other energy sources in new generating capacity in 2023, accounting for 42.2% of total new capacity, according to the Federal Energy Regulatory Commission’s latest energy infrastructure update.
By 2026, FERC said, solar’s installed generating capacity will account for more than 13% of the country’s total generating capacity — surpassing wind and hydropower.
Generation challenges
But solar’s low capacity factors (the ratio of actual energy production compared to peak production) mean that a more varied energy mix is essential to keep global climate goals in-reach.
Renewables capacity may have tripled between 2010 and 2022 but renewable electricity generation only doubled, BNEF found, because such a large proportion of the new capacity was solar. The average capacity factor for solar in 2022 was 13.2%; meanwhile, wind farms had a global average of 27.2%, hydro plants had an average of 40%, and geothermal reached 68%.
The very things that helped solar to scale so phenomenally — namely that it’s cheap to build and cheap to buy — are also reasons to diversify the global mix, Chase said. She added that the incredibly low (“almost free”) price of solar electricity during the daytime in many parts of the world is actually a double-edged sword.
“That sounds like a really good thing, but it does mean that it’s more difficult to build anything else,” she said, pointing to wind farms in particular. “It’s going to be more difficult to build that if it gets no money in the daytime.”
To be honest, I think our forecasts are fairly conservative….Forecasting solar is hard, but it does consistently outperform reasonable expectations.
In the BNEF report, Chase wrote that that dynamic results in the potential for solar to “cannibalize the returns of other clean power plants such as wind farms, preventing build and driving more fossil fuel at night and in the winter.”
Then there’s the challenge of geography.
“The trouble with forecasting solar is that if you just stick to any kind of exponential growth way, you’re going to be wrong for individual markets,” Chase said. “And secondly, you end up with the whole world covered in solar panels, which isn’t quite a sensible answer.”
Regions closer to the equator can probably get away with relying more heavily on solar and batteries, she said, with backup generators for monsoon seasons. But in northern Europe, for example, relying on solar becomes a structural problem, in part because it’s unlikely that we’ll shift enough electrical demand to daytime hours.
BNEF’s net zero scenario calls for increasing energy storage capacity by 16-fold. The more solar is a part of the 2030 mix, the more batteries will be needed. And among Chase’s key takeaways is that it might be time to focus a little more on something like wind, which the report says requires “concerted action” to get on track.
“There’s a lot of skepticism in the report coming from me,” Chase said, “Because solar is great, but you do want something that generates at night and in the winter, because if you have to build batteries for all the solar, that’s probably going to be a problem.”
The immense success of solar, and its outsized role in both 2030 and 2050 goals, however, shouldn’t be understated.
“Solar is one of the major reasons I have hope for the future,” she said. “Have we over-focused? Maybe, but it worked!”
