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The growth in capacity addition of renewable energy sources has stalled, says a report by the International Energy Agency (IEA). According to the report, the year 2018 was the first year since 2001 in which the growth in renewable power capacity could not increase on a year-over-year basis. New net capacity from solar PV, wind, hydro, bioenergy, and other renewable power sources increased by about 180 GW in 2018, the same as the previous year.

This is about 60% of the net addition needed each year to meet long-term climate goals.

At this rate, the countries are not going to be able to meet the goals of the Paris agreement which requires a global addition of about 300 GW capacity of renewables each year from 2018 to 2030, said the report.

Further, according to the IEA, energy-related CO2 emissions increased by approximately 1.7% to a historic high of 33 gigatons. This is worrying since there was a growth of 7% in renewables electricity generation and emissions from the power sector grew to record levels.

In the report, IEA noted that since 2015, rapid growth in solar photovoltaic (PV) was compensating for the slowdown in capacity additions of wind and hydropower projects. However, since last year, the capacity addition of solar PV has also slowed down due to a change in solar incentives in China. As reported by Mercom, the Price Bureau of China’s National Development and Reform Commission (NDRC) announced the level of solar FIT payments for large-scale projects which will become effective from July 1, 2019. Back in June of 2018, China shocked the global solar markets by imposing installation caps and a reduced feed-in tariff for solar projects in the country affecting solar demand in the country after which installations declined from 53 GW in 2017 to 44 GW in 2018. The change in policy is a result of a massive subsidy backlog of 120 billion yuan.

In addition to China, Europe and India reported lackluster growth in wind installations in 2018.

Solar installations in India have reached 30 GW according to preliminary figures from Mercom’s India Solar Project Tracker. The share of solar capacity grew from 6.6% as of March 2018 to 8.4% as of March 2019. Among renewables, solar accounted for approximately 38% of the installed capacity, up by 2% compared to the previous quarter.

Wind currently accounts for over 35 GW of the total installed power capacity and nearly 10% of the overall power capacity mix, as of March 2019 in India. The installations were down in FY 2018-19, adding around 1.5 GW in capacity additions.

“The world cannot afford to press “pause” on the expansion of renewables and governments need to act quickly to correct this situation and enable faster flow of new projects,” said Dr. Fatih Birol, IEA’s executive director.

“Thanks to rapidly declining costs, the competitiveness of renewables is no longer heavily tied to financial incentives. What they mainly need are stable policies supported by a long-term vision but also a focus on integrating renewables into power systems in a cost-effective and optimal way. Stop-and-go policies are particularly harmful to markets and jobs,” Birol added.

In the Indian context, capacity addition for renewable energy projects fell from 15 GW in 2017 to 14 GW in 2018. Solar PV which was a major contributor to renewable energy capacity addition is expected to lag this year because of cancellation of tenders, complexities concerning taxation and the general election. In April 2019, Mercom reported that since the beginning of 2018, various government agencies such as the Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA), the Grid Corporation of Odisha (GRIDCO), Gujarat Urja Vikas Nigam Limited, and others had canceled nearly 5 GW of solar auctions.

Besides the cancellation of tenders, lingering uncertainties around the imposition of safeguard duty and GST have also stalled the development of various projects across the country.

Shaurya is a staff reporter at MercomIndia.com with experience working in the Indian solar energy industry for the past four years in various roles. Prior to joining Mercom, Shaurya worked with a renewable energy developer and a consulting company. Shaurya holds a Bachelors Degree in Business Management from Lancaster University in the United Kingdom.