The global renewable energy landscape is set to undergo significant expansion, with over 5.4 terawatts (TW) of new solar and wind capacity expected to be added from 2024 to 2033, according to the latest report by Wood Mackenzie.

The projected growth is expected to bring the total global capacity to 8 TW, reflecting the worldwide push towards electrification and decarbonization.

Annual capacity additions are projected to average 560 GW over the 10-year outlook, up from approximately 500 GW of new solar and wind capacity installed in 2023.

Energy storage capacity is projected to experience even more dramatic growth, with an increase of over 600% during the same period.

Nearly 1 TW of new energy storage capacity (excluding pumped hydro) is anticipated to come online, making it one of the fastest-growing sectors in the power industry.

“Global demand for renewables has reached unprecedented levels, driven by country-level policy targets, technology innovation, and concerns over energy security. Integrated power technology solutions will continue to evolve, evidenced by a significant increase in storage-paired capacity growth, despite inflation, grid constraints, and permitting challenges,” said Luke Lewandowski, vice president, global renewables research at Wood Mackenzie.

China is expected to maintain its dominant position in solar, energy storage, and wind uptake, with 3.5 TW forecast to be grid-connected between 2024 and 2033.

Solar to Lead Deployment

Solar is set to lead the deployment race, accounting for 59% of global capacity additions during this period. Energy storage is anticipated to have the most balanced geographic distribution, partly due to its crucial role in enhancing the availability of renewable power.

The global installed capacity of solar is projected to nearly quadruple from 2024 to 2033, driven by ultra-low module prices that have accelerated deployments in Europe and China. However, grid constraints and lower power prices may impact other regions.

Wood Mackenzie forecasts that 4.7 TW_dc of new solar capacity will be built during this period, with China contributing 50% of this growth.

In 2023, a drop in Chinese module prices and tight project deadlines led to a 150% annual growth in solar installations.

This growth trend is expected to continue until 2026, when a temporary slowdown is anticipated before the next wave of procurement drives higher deployment.

In the first quarter of 2024, solar installations in the U.S. surpassed the entire capacity installed in 2019. According to Wood Mackenzie, China’s installations increased by 36% year-on-year, and India’s new capacity reached 85% of its total 2023 capacity.

However, Europe’s distributed PV market showed signs of weakening, with residential installations in Germany and the Netherlands contracting significantly.

Energy Storage

Global energy storage capacity is expected to increase sixfold by the end of 2033, surpassing 1 TW/3 TWh. In 2023, energy storage deployment grew by 162% compared to 2022, driven by policy support and tax exemptions.

Wood Mackenzie forecasts that 926 GW/2789 GWh of new energy storage capacity will be added between 2024 and 2033, with China leading the market due to its booming solar sector. Europe is also seeing growth in grid-scale projects, although demand from the distributed segment has decreased as retail rates stabilize.

A recent report by the International Energy Agency said energy storage infrastructure must expand by at least six times the current capacity if the world wants to triple renewables capacity by 2030 while maintaining electricity security.

 Wind Market Outlook

According to Wood Mackenzie’s latest global wind market outlook, the wind power industry will add more than 1.7 TW of new capacity between 2024 and 2033. China will remain the dominant player, with an average annual installation of 91.5 GW. This is driven by strong policy support from the central government to promote energy transition and meet carbon-neutral targets.

Outside China, global wind additions will average 85 GW per year, a substantial increase from the previous 10-year average of 37 GW.

The offshore wind sector globally will average 39 GW of connected capacity annually from 2024 to 2033 (386 GW total). By 2033, annual offshore wind installations are expected to reach 54 GW.

The COP28 Tripling Renewable Capacity Pledge aims to triple the global renewable energy capacity from its current levels, targeting over 11,000 GW of installed capacity by the decade’s end. However, the International Energy Agency said the road to achieving this goal is fraught with challenges and requires unprecedented international cooperation and policy support.