In the main case, global annual renewable capacity additions rise from 666 GW in 2024 to almost 935 GW in 2030. Solar PV and wind are forecast to account for 95% of all renewable capacity additions through 2030 because their generation costs are lower than for both fossil and non‑fossil alternatives in most countries, and policies continue to support them.

Hydropower contributes 20-30 GW annually over 2024-2030 as emerging and developing economies (especially in Africa) gradually tap into their vast potential. Annual capacity additions for bioenergy and other renewables are expected to reach roughly 12 GW by 2030.

Global renewable capacity is expected to increase over 5 520 GW during 2024-2030, 2.6 times more than deployment of the last six years (2017-2023). Utility-scale and distributed solar PV growth more than triples, accounting for almost 80% of renewable electricity expansion worldwide. Solar PV adoption accelerates thanks to declining equipment costs, relatively rapid permitting and widespread social acceptance. PV project size can range from few watts to gigawatt-level utility-scale plants, providing low-cost zero-emission electricity to individuals, small companies, large industries and utilities.

In our forecast, distributed applications (encompassing residential, commercial, industrial and off-grid projects) make up almost 40% of the overall PV expansion. As more policies enable self-consumption and as economic attractiveness increases, more consumers and companies are seeking to reduce their electricity bills by installing small-scale solar PV systems. 

Compared with 2017-2023, our forecast expects onshore wind cumulative additions to almost double by 2030 reaching 846 GW. Despite recent supply chain, inflation and permitting challenges, we foresee recovery of the sector in the medium term as policies (including in Europe, the United States, India and other emerging and developing economies) adapt to the new macroeconomic environment, introduce measures to accelerate permitting and enhance project bankability.

However, the pace at which recent policy changes will be implemented over the forecast period remains uncertain. In addition, higher projects risk and longer timelines resulting from social acceptance challenges can limit expansion. For these reasons, international developers and investors seeking faster project development have been channelling capital from wind to solar PV projects in the past five years. Nevertheless, annual additions are expected to rise in Africa, the Middle East, ASEAN countries, Latin America and Eurasia – in addition to Europe, the United States and India. 

Offshore wind capacity growth is expected to reach 212 GW by 2030, almost quadrupling the previous six-year period. The annual offshore wind market is expected to expand from 9.5 GW in 2023 to over 45 GW in 2030, with China alone responsible for half of this growth. Europe’s annual market reaches almost 18 GW by 2030, and the United States, Japan and Korea emerge as new gigawatt-level annual markets.

Overall, macroeconomic and supply chain challenges impact offshore wind more than other renewable technologies because projects are large, lead times are long and investment requirements are relatively high. These obstacles have reduced offshore project bankability in several European markets and led to multiple offshore plant cancellations in the United States. 

Hydropower capacity growth in 2024-2030 is similar to 2017-2023, with over 165 GW becoming operational. China’s unwavering ambition to install large-scale conventional and pumped-storage hydro systems accounts for almost 40% of forecast global expansion. While growth in China slows through 2030, it accelerates in India, the ASEAN region and Africa. Many governments have hydropower ambitions for 2030 and large pipelines of projects under development. EU hydropower activity is also expected to rise slightly thanks to 3.3 GW of pumped-storage hydropower projects in Spain and Austria. 

Over 2024-2030, China is expected to install 3 207 GW of new renewable electricity capacity, more than tripling growth of 2017-2023. Since 2015, China’s share in global annual capacity additions has been increasing and is expected to reach almost 60% in 2030. At the end of the forecast period, the country is expected to have at least half of the world’s cumulative renewable electricity capacity, doubling its share of the last decade. The Chinese government’s Net Zero by 2060 target, supported by incentives under the 14th Five-Year Plan (2021-2025), and the ample availability of locally manufactured equipment and low-cost financing, stimulate the country’s renewable power expansion over the forecast period.

The European Union remains the second-largest growth market after China, with annual additions continuing to increase through 2030 at a faster pace than before. Member countries recently submitted their draft national plans to achieve the new overall EU target. For renewable electricity, their ambitions are in line with the overall EU goal, but they lack ambition for other sectors, including transport, industry and buildings. Renewable energy auctions, corporate PPAs and incentives stimulating distributed solar PV will continue to spur capacity growth in the next six years, doubling the bloc’s previous achievements.

US renewable energy expansion more than doubles over 2024-2030 to almost 500 GW, propelled by generous Inflation Reduction Act (IRA) stimulus in the form of tax incentives. Meanwhile, India’s annual renewable capacity additions are expected to increase more quickly than for any other major economy, including China. In the main-case forecast, India’s capacity additions more than quadruple from 15 GW in 2023 to 62 GW in 2030.

In Latin America, higher retail prices spur distributed solar PV system buildouts, and supportive policies for utility-scale wind and PV installations in Brazil boost renewable energy growth to new highs. Renewable energy expansion also accelerates in the Middle East and North Africa, owing mostly to policy incentives that take advantage of the cost‑competitiveness of solar PV. Although renewable capacity increases more quickly in sub-Saharan Africa, the region still underperforms considering its resource potential and electrification needs. 

Global renewable electricity capacity in 2030 reaches almost 11 000 GW in the accelerated-case forecast – almost fulfilling the COP28 tripling pledge, which implies over 11 000 GW of renewable capacity installed by 2030. Accordingly, China alone accounts for almost half of global renewable capacity operational by 2030, climbing to over 5 100 GW in our accelerated case.

However, China’s accelerated-case renewable energy growth is only 11% (340 GW) higher than in the main case. For China, the accelerated case assumes faster transmission and distribution grid expansion, enabling the deployment of additional renewable electricity projects in the pipeline. China maintains a large surplus of solar PV and wind manufacturing capacity at competitive costs, which can unlock faster growth if grid integration challenges are resolved rapidly and companies install rooftop solar PV systems more quickly.

In advanced economies, the upside potential of the accelerated case over the main case is 184 GW for the European Union and 80 GW for the United States. The upside in the European Union also considers faster deployment of renewables for hydrogen production. For the European Union and the United States, our forecast considers several obstacles to faster expansion:

• lengthy permitting wait times
• a lack of long-term planning, leading to inadequate grid infrastructure investments that delay new wind and solar PV plant connections
• insufficient system flexibility to cost-effectively integrate variable renewable energy.

In the United States, tax credits remain a generous and stable policy incentive, stimulating power purchase agreements between developers and utilities. For the European Union, however, government-driven auctions continue to be a key stimulant of utility-scale renewable energy growth. The main auction challenges are:

• Inadequate visibility over auction volumes, and auction designs that are not fitted to the new macroeconomic environment (i.e. high inflation and elevated interest rates).
• Long permitting wait times, which reduces the number of projects able to participate in competitive auctions.

India’s renewable capacity growth could be 24% higher in the accelerated case if the government addresses: 

• Land procurement barriers and lengthy grid connection wait times, which limit the expansion of utility-scale projects.
• The weak financial health of distribution companies (despite recent improvements), which slows the pace of distributed solar PV growth.
• Relatively slow solar PV manufacturing expansion and restrictive trade measures, which limit the availability of affordable top-tier PV modules.

In the ASEAN region, several policy improvements lead to a more optimistic forecast for several countries, but some challenges continue to prevent renewable energy from expanding 70% more than in our main case:

• In countries with fossil fuel overcapacity and ambitious long-term decarbonisation goals, it is a costly endeavour for utilities to install new renewable energy technologies in the place of young fossil fuel-fired power fleets established on long-term contracts with take-or-pay clauses.
• Renewable energy technology costs in these markets exceed international benchmarks, making them less competitive.
• Financing costs and project risk are high.

Renewable capacity growth could also be higher than in the main case in the nascent markets of sub-Saharan Africa (+34%) and Eurasia (+52%), as both regions have significant untapped renewable energy potential and growing electricity demand. However, several challenges persist:

• Weak/slow grid infrastructure expansion limits electricity access and services.
• High financing costs reduce renewable energy project bankability.
• Visibility over auction volumes is inadequate and the period between announcement and contract-signing remains lengthy. 
  

In July 2024, the IEA’s renewable policy stocktaking report (COP28 Tripling Renewable Capacity Pledge), which assessed all existing goals, targets and plans of 150 countries, found that overall ambitions correspond to almost 8 000 GW of renewable power capacity installed globally in 2030. This is 2.2 times installed capacity in 2022, which we consider as the baseline for the global tripling pledge.

In our main case, however (considering recent cost trends), current policies and market developments drive cumulative renewable capacity to almost 9 760 GW in 2030 – a 2.7‑times increase from 2022, or almost 25% above countries’ ambitions. Nevertheless, the main case is still not on track to triple global renewable capacity to over 11 000 GW, indicating that an ambition gap and implementation challenges continue to impede faster renewable power expansion.

Conversely, our accelerated case assumes that governments address key policy, grid integration, financing and permitting challenges in the short term to unlock almost 20% more capacity compared with the main case, enabling an almost tripling of global renewable capacity by 2030. 

In the main-case forecast, 73 of the 150 countries analysed reach or surpass their existing policy goals for renewable capacity; these countries hold almost 80% of global cumulative capacity today. China drastically dominates among these overachievers, but other major economies such as the United States, Brazil and India also contribute. While most countries are expected to fall short of realising their current ambitions, they account for only 15% of our forecast. In this group, no single country dominates the trend.

The main-case forecast expects both G20 and G7 countries to exceed their current ambitions. Outside of China, most emerging markets and developing economies are also on track to realise their ambitions. However, recognising that the untapped renewable energy potential of emerging and developing economies is considerable, these countries (especially in the ASEAN region and Eurasia) could consider increasing their aims in their next national plans and Nationally Determined Contribution (NDC) updates. MENA countries and sub-Saharan Africa are not on track to fulfil their announced ambitions according to our forecast, as significant implementation challenges persist. 

In the first half of 2024, 82 GW of renewable energy capacity was awarded globally in competitive auctions, with more than half of it concentrated in just two countries: India and Germany. This is more than double the average volumes awarded during six-month periods in recent years, and almost reaches the record-level capacity awarded in tenders during the entire 2023. 

In the last three years, around 40% of year-end capacity was auctioned on average from January to June. Considering this trend, global auction capacity could total slightly over 200 GW by the end of 2024, more than double of 2023.

Auction design, macroeconomic conditions, permitting pace and grid availability continue to be key factors impacting developer interest and participation. Auction award rates have changed year-on-year, with the lowest in 2022. High commodity prices, escalating investment costs and inflation, combined with relatively low ceiling prices in auctions, led the award rate to drop to 75% in 2022. Award rates continued to increase slightly from 84% last year to 89% in the first half of 2024, with the awarding of around 82 GW of the 92 GW of auctioned capacity being offered.

The solar PV industry confronts financial strains amidst fierce competition, supply gluts and technological advances

The global solar PV industry is currently experiencing significant financial turbulence because of supply overcapacity, intense price competition, technological innovation and shifting market dynamics. In the past year, the prices of essential PV components (e.g. polysilicon, wafers, cells and modules) plummeted almost 50%, severely impacting profit margins across the value chain. This drop is leading manufacturers to either scale down or pause their operations – or get pushed out of the market entirely – as maintaining profitability becomes increasingly challenging.

The financial performance of solar equipment manufacturers has been particularly affected by the oversupply situation. Despite having better cost control, vertically integrated companies throughout the value chain are feeling pressure. Higher competitiveness is impacting even industry leaders, which are operating with minimal margins. Some companies are selling their products at below manufacturing costs to maintain their market share, while others have already reduced production.

In the second quarter of 2024, integrated solar PV manufacturing companies were operating at negative net margins. Several key manufacturers were grappling with cash flow issues, struggling to cover short-term liabilities. Only a few have managed to maintain healthy financial performance, primarily those with strong cash positions, effective cost management strategies and niche technologies, including thin film.

In the polysilicon industry, the global price of polysilicon had dropped to as low as USD 4‑5/kg by Q2 2024 because production capacity worldwide had doubled, reaching 800 GW in 2023. This sharp decline followed a period in November 2022 when rising demand for solar PV modules and inadequate polysilicon manufacturing capacity had driven prices up to USD 40/kg.

During this peak, manufacturers and producers benefited from higher net margins as their costs did not rise proportionally. However, the rapid increase in capacity led to oversupply, causing prices to plummet and resulting in average negative margins by Q1-Q2 2024. Historically, such supply and demand imbalances in the past have created similar financial challenges.

The number of advanced-stage projects waiting for grid connection remains high, but grid queue rule reforms are already delivering results

Total wind, solar PV and hydropower capacity in advanced development stages waiting for grid connections increased from around 1 500 GW in 2023 to 1 650 GW by July 2024. However, while the capacity of these projects has risen slightly, total projects waiting for grid connection has decreased 3% due to declines in early-stage projects.

Globally, countries have been addressing connection queue bottlenecks through grid reforms, introducing new measures to speed up connection timelines. These rules aim mainly to reduce the number of speculative projects or allow projects to exit connections queues without penalties. While these reforms are in their early stages, some of the impacts can already be seen. For projects under grid connection review and in the late stages of development, capacity has increased almost 8%, while for those in the early stages it has decreased nearly 15%, with major reductions the United States (-38%), Brazil (-31%) and Mexico (-2%).

Solar PV remains the dominant technology waiting for grid connection, representing the majority of renewable capacity in advanced stages (over 60%) followed by wind (over 35%); hydropower represents just over 1%. From 2023 to 2024, for capacity in advanced stages (either under review or in the late stage of review), solar PV increased almost 15% and wind remained unchanged. These trends reflect global addition trends, with new solar PV capacity far outpacing both wind and hydropower.