Renewables to Account for 90% of the Global Power Capacity Increase in 2021 and 2022: IEA

Solar will lead renewables expansion with 145 GW of capacity addition in 2021 and 162 GW in 2022


Renewable energy is expected to account for 90% of the global power capacity increase in 2021 and 2022, according to International Energy Agency’s (IEA) Renewable Energy Market Updates – Outlook for 2021 and 2022. The sector is projected to grow at an accelerated rate as the global economy recovers from the crisis.

The report predicts that around 270 GW of new renewable energy capacity will be operational in 2021 and 280 GW in 2022. The expansion would exceed the record annual capacity additions of 2017-2019 by more than 50%.



According to IEA’s forecast, solar photovoltaic (PV) projects installation will increase 8% and reach 145 GW in 2021 and 162 GW in 2022, accounting for over 55% of all renewable energy expansion in 2021 and 2022.

The share of large-scale solar projects in annual installations will rise from over 55% in 2020 to 70% in 2022.

The report said developers who won auctions at tight margins but did not purchase panels faced a challenge due to high PV prices. However, they will be relieved as the impact of supply chain constraints, and higher commodity prices and module prices would not last through 2021.


Wind capacity installation is expected to drop by about 30% in 2021-2022 after the exceptional jump last year in China. However, IEA anticipates 80 GW of annual wind power installations, a 35% growth compared to around 60 GW installed in 2019. It expects slightly lower onshore and offshore installations in 2022.

The report noted that the pace of hydropower additions would be driven by the commissioning of mega-scale projects in China.


The Covid-19 impact on renewable energy deployment affected India more than any other country, reducing the country’s capacity additions by almost 50% in 2020 from 2019. According to IEA, the country is expected to set new renewable capacity expansion records in 2021 and 2022 as delayed projects from the previous competitive auctions would be commissioned.

According to Mercom’s India Solar Market Update, India added over 7.4 GW of solar capacity in the first nine months of the calendar year (CY) 2021, increasing 335% compared to 1.73 GW in 9M 2020.

However, the financial health of distribution companies (DISCOMs) remains the primary concern for renewable energy deployment in India.

DISCOMs owed ₹194.52 billion (~$2.61 billion) to renewable energy generators (excluding disputed amounts) in overdue payments at the end of December 2021, according to data released by the Ministry of Power.


The report expects China’s renewable energy capacity additions to fall in 2021 compared to the last year as the government decided to phase out subsidies for wind and solar projects at the end of 2020. The Chinese renewables market is uncertain about the structure of the new incentive program that will be announced towards the end of 2021.

However, China’s renewable energy capacity additions are expected to be 45% higher in 2021 and 58% higher in 2022 than the average additions of 2017-2019. The growth of renewable expansion may accelerate after 2022 in China, stimulated by new policy measures in line with the country’s target to attain net-zero emissions by 2060.

China’s solar capacity additions will be around 40 GW in 2021. The country is also expected to add over 6 GW of offshore wind capacity in 2021. It would account for around 60% of the 10 GW scheduled to be installed in 2021.


IEA said annual capacity additions in Europe would increase 11% to 44 GW in 2021 and 49 GW in 2022. With this expansion, Europe would become the second-largest renewables market after China. Germany would lead the capacity additions, followed by France, the Netherlands, Spain, the United Kingdom, and Turkey.

IEA does note the challenge in closing the supply-demand gap of components for the projects as China continues to be at the center of the global renewable trade. It predicts that any slowdown in China in the coming years will be compensated for by strong growth in Europe, the United States, India, and Latin America, where government support and falling prices for solar PV and wind continue to drive installations.

Earlier, IEA, in its report, stated that global hydropower capacity is expected to increase 17%, or by 230 GW, in the upcoming decade.

Harsh Shukla is a staff reporter at Mercom India. Previously with Indian Express, he has covered general interest stories. He holds a Masters Degree in Journalism from Symbiosis Institute of Media and Communication, Pune.

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