The Advancing Clean Technology Manufacturing report from the International Energy Agency (EA) analysed spending and capacity deployment of five clean energy technologies – solar PV, wind, batteries, electrolysers and heat pumps. It found that spending on these solutions reached $200bn globally in 2023, a 70% increase on 2022 levels and around 4% of global GDP growth.
The IEA states that currently, spending on solar PV manufacturing is aligned with the levels needed by 2030 to meet a net-zero scenario.
China remains the dominant player in the solar market, accounting for more than 80% of global solar PV manufacturing capacity. The country is the lowest-cost producer of all clean energy technologies analysed in the report. For some solutions, it can cost between 70% to 130% to manufacture in the US or Europe than in China.
“Record output from solar PV and battery plants is propelling clean energy transitions – and the strong investment pipeline in new facilities and factory expansions is set to add further momentum in the years ahead,” the IEA’s executive director Fatih Birol said.
“While greater investment is still needed for some technologies – and clean energy manufacturing could be spread more widely around the globe – the direction of travel is clear. Policymakers have a huge opportunity to design industrial strategies with clean energy transitions at their core.”
Battery boon
The IEA notes that around 40% of clean energy investments made in 2023 were in facilities due to become operational this year.
For batteries, this share rises to 70% of projects in the pipeline that are expected to come online this year.
Indeed, if all battery projects announced do come online, manufacturing for this solution is 90% of the way to meeting net-zero demand requirements by the end of the decade.
The findings come as RenewableUK published an outlook on the UK’s burgeoning battery market.
The report, published last week, found that the UK’s battery storage pipeline has grown by 66% over the last year.
Renewable UK’s EnergyPulse Energy Storage report found that the UK’s battery storage pipeline – ranging from planned to operational – increased from 57GW to more than 95GW over the course of a year. This would be enough to fully charge more than 2.6 million electric vehicles (EVs).
The research found that operational battery storage capacity has grown by 4.4GW in the last year, while a further 30GW has been consented.
RenewableUK’s Director of Future Electricity Systems Barnaby Wharton said: “It’s great to see that, for the second year running, the UK’s battery storage pipeline has grown by two-thirds within the space of twelve months. The appetite among investors to enter this rapidly-growing market remains enormous.
“Batteries have a key role to play in ensuring that electricity supply always meets demand. While there has been significant uptake in projects, we are long way from delivering the 55GW of short-term flexibility by 2035 that the Government says we need in its Review of Electricity Market Arrangements. We have the potential to move much faster by speeding up the process of consenting and connecting vital energy storage projects to the grid.”