IRENA’s first Global Renewables Outlook finds that there is an opportunity to meet climate goals while boosting economic growth by advancing the renewables-based energy transformation.
The decarbonization of the energy system can support short-term economic recovery and increase global GDP in the long term.
While a move to deeper decarbonization would require total investments of up to $130 trillion, the gains would be enormous, according to the Outlook.
The transformation of the energy industry could increase global GDP by $98 trillion between now and 2050. Renewable energy jobs would nearly quadruple to 42 million, increase employment in energy efficiency to 21 million, and system flexibility by 15 million.
“Governments are facing a difficult task of bringing the health emergency under control while introducing major stimulus and recovery measures. The crisis has exposed deeply embedded vulnerabilities of the current system. IRENA’s Outlook shows the ways to build more sustainable, equitable and resilient economies by aligning short-term recovery efforts with the medium-and long-term objectives of the Paris Agreement and the UN Sustainable Development Agenda.
By accelerating renewables and making the energy transition an integral part of the wider recovery, governments can achieve multiple economic and social objectives in the pursuit of a resilient future that leaves nobody behind.”Francesco La Camera, IRENA’s director-general.
The Global Renewables Outlook examines the building blocks of the energy industry, investment strategies, and the political framework to master the energy transition. It searches for ways to cut global CO2 emissions by at least 70 percent by 2050. Also, a new perspective of switching to a low-emission economy shows a path towards zero emissions.
Five technology pillars, mainly green hydrogen and extended end-use electrification, could help replace fossil-fuels and slash emissions in heavy industry and hard-to-decarbonize sectors.
The Outlook show, investing in low-carbon technologies would be significantly worth it, with savings of eight times the cost if one takes into account the lower external environmental and health costs. A climate-safe approach would require cumulative energy investments of $110 trillion by 2050, but achieving full carbon neutrality would add another $20 trillion.
The Outlook also examined the energy and socio-economic energy transition paths in 10 regions worldwide. Despite varied ways, all regions are expected to see higher shares of renewable energy use, with Southeast Asia, Latin America, the European Union and Sub-Saharan Africa poised to reach 70-80 percent shares in their total energy mixes by 2050.
Electrification of end uses like heat and transport would rise everywhere, exceeding 50 percent in East Asia, North America, and much of Europe.
All regions would also see a substantial increase in their wealth and a net job gain in the energy sector, despite the losses in fossil fuels. However, the overall economic, regional job gains are unevenly distributed. While regional GDP growth would vary considerably, most regions could expect profits.
Coordination on international, regional, and domestic levels is going to be necessary, with financial aid being directed to the most vulnerable countries and communities.