IEA: Solar and storage manufacturing boom to push world toward net-zero
Existing and planned manufacturing projects for clean energy technologies including solar and energy storage are outpacing the required levels to meet net-zero emissions by 2050, but other technologies will need to catch up.
The International Energy Agency’s (IEA) The State of Clean Technology Manufacturing report examined the estimated output of clean technologies.
The report found that, since 2022, the estimated output of manufacturing projects for solar solutions by 2030 has increased by 60%. Additionally, outputs for energy storage and battery solutions are up 25% by the same metrics.
The IEA claims that there is “growing global momentum behind a new energy economy”, but that manufacturing opportunities are dominated by three markets, namely China. If all announced clean technology projects worldwide were completed, the share of manufacturing clustered in these markets would shift to between 70% and 95% by 2030.
“If we look at the projects that are currently under construction or planned worldwide, China is set to strengthen its leading position in key clean energy technologies,” the IEA’s executive director Fatih Birol said.
“There is a need for effective international cooperation and further diversification to ensure secure and resilient technology supply chains, meet the world’s climate goals and enable all countries to enjoy the economic benefits of the new global energy economy.”
The report covers planned and announced manufacturing projects for solar PV, wind power, batteries, heat pumps and electrolysers. It found that if all the projects to date were deployed, the output of manufacturing capacity would reach $790bn a year by 2030.
The IEA claims that, under this scenario, manufacturing outputs for solar PV would exceed the levels needed in its Net Zero Emissions by 2050 Scenario. Battery manufacturing capacity would also meet the level of the scenario envisaged for 2030. The remaining technologies would still be far off the required levels to deliver net-zero, however.
Earlier this year, research from the IEA found that clean energy manufacturing could be worth more than $650bn annually to the global economy by 2050.
The IEA’s Energy Technology Perspectives 2023 found that countries will need to overcome challenges related to supply chain concentration and a limited workforce in order to realise the economic potential of clean technology sectors. The report also states that clean energy manufacturing jobs could more than double to 14 million by 2030.
The report welcomed new flagship policies that will help drive the market in the near term. The Inflation Reduction Act in the US, for example, is a package of measures to help vulnerable people pay for health care and to reduce emissions, with a focus on energy and transport. Elsewhere, the Fit for 55 package and REPowerEU plan in the European Union are spurring market growth, as are Japan’s Green Transformation programme, and the Production Linked Incentive scheme in India that encourages manufacturing of solar PV and batteries.
More recently, the European Commission unveiled its highly anticipated proposals for a Net-Zero Industry Act to accelerate the scale-up and manufacturing of clean technologies across the European Union. Early drafts of the Net Zero Industry Act set out new targets of at least 40% of clean energy technologies to be manufactured in the EU by 2030, which has been formally adopted.
© Faversham House Ltd 2023 edie news articles may be copied or forwarded for individual use only. No other reproduction or distribution is permitted without prior written consent.
Please login or Register to leave a comment.