Solar Energy in the Global Energy Future

"Solar energy is set to become the world’s primary energy source in the coming years. It is a key resource for the global energy transition." These words from Fatih Birol, Executive Director of the International Energy Agency (IEA), summarize the growing importance of solar energy in the current context of climate challenges and energy security.

In recent years, solar energy has experienced extraordinary growth. According to IRENA (International Renewable Energy Agency), the global installed capacity of solar photovoltaic energy reached about 1,200 gigawatts (GW) in 2022, marking an increase of over 200 GW compared to 2021. This expansion is primarily due to the decrease in costs, which have dropped by more than 80% over the last decade, making solar energy one of the most accessible and competitive sources. In 2010, the global average cost for solar energy installation was approximately 0.378 USD/kWh, while by 2022 it had fallen to about 0.091 USD/kWh. Additionally, governments worldwide have implemented measures to incentivize solar energy adoption, such as tax credits and subsidies.

Future Projections

In 2018, the installed capacity of solar photovoltaic (PV) energy worldwide was 481 GW. It is projected that this capacity will increase nearly sixfold by 2030, reaching 2,841 GW, and almost 18 times by 2050, reaching 8,519 GW, of which 40% will be represented by distributed-scale installations (rooftop systems) and 60% by utility-scale plants.

Asia will continue to dominate the photovoltaic market, accounting for about 65% of global installations, primarily driven by China, which will contribute 76% of the total. North America will follow with 15% (over 90% coming from the United States), and Europe will hold 10% by 2030.

By 2050, Asia, especially China, is expected to maintain its leadership with 4,837 GW (about 57% of global installations), followed by North America with 21% and Europe with 11%. Additionally, significant market growth is expected in Africa and South America by 2050.

Market Segments 2023 – 2027

The growing adoption of solar energy by the residential and commercial sectors reflects a strong interest in generating and self-consuming electricity, reducing dependence on the grid. Commercial & Industrial (C&I) installations now represent the second-largest segment after residential, while large-scale utility installations are still underdeveloped. However, starting from 2024, an increase to 57% in 2027 is expected, compared to 51% in 2022, for this type of system.

As for residential installations, annual capacity is expected to grow to 183 GW in 2024 and up to 268 GW in 2027 in a medium scenario. The introduction of new energy efficiency mandates in various countries could further boost the photovoltaic market. Additionally, the electrification of the heating sector, with the promotion of heat pumps, is facilitating the transition toward decarbonization.

Focus on Europe

In Europe, solar energy is experiencing strong growth and development. The European Union has set ambitious targets for 2030, aiming to install 600 GW of solar energy, with projections that it could cover up to 25% of the EU’s energy needs. Countries such as Germany, Spain, and Italy are leading this transition, investing in infrastructure and incentivizing the installation of solar power systems.

Germany, historically a leader in solar energy adoption, boasts an installed capacity of over 70 GW. The country has implemented a system of incentivizing tariffs that has stimulated the adoption of renewable energy. Spain has also made significant progress, doubling its installed solar capacity in the past five years due to favorable policies and investments in solar technologies.

Italy and Solar Energy

Italy, with its sunny climate and growing awareness of the need for an energy transition, is in a prime position to harness solar energy. In 2022, the country’s installed solar capacity surpassed 25 GW, with a goal of reaching 50 GW by 2030. To achieve this target, Italy is investing in large-scale solar projects and residential systems, supported by incentive policies and tax breaks.

In particular, the "Superbonus 110%" introduced in 2020 has incentivized the installation of photovoltaic systems in private homes, allowing citizens to receive reimbursements of up to 110% of the expenses incurred. This has led to a significant increase in solar panel installations, contributing to greater energy self-sufficiency and reduced greenhouse gas emissions.

Sustainability and Decarbonization

The growing adoption of solar energy is essential for meeting global decarbonization goals. According to the IEA's Global Energy Review 2023, if current decarbonization commitments are maintained, solar energy could cover up to 30% of the world’s energy needs by 2040. This would be a crucial step in limiting global temperature increases, helping to keep the rise below 1.5 degrees Celsius compared to pre-industrial levels.

However, significant challenges remain. In Europe, it is crucial to upgrade grid infrastructure to effectively integrate solar energy, making the transition to a smart and resilient grid indispensable. Moreover, developing efficient storage systems is essential to ensure a constant supply of energy, as current storage technologies face issues related to affordability and scalability.

WeCo’s Role in the Energy Transition

In a context of growing interest in renewable energy, WeCo positions itself as an innovative and key player in the transition towards a sustainable energy future. We offer a comprehensive range of solutions, designed to meet the needs of various sectors, including residential, commercial & industrial, and utility.

Our goal is to facilitate the adoption of solar energy, contributing not only to clean energy production but also to optimizing its use. For instance, our energy storage systems are designed to allow consumers to store energy produced during peak sunlight hours. This approach ensures a continuous energy supply, even during periods of low production, enabling more efficient management of energy resources.

Furthermore, our products are designed to be easily integrated into various system configurations, providing flexibility and adaptability to each customer's specific needs.

Not only do we support the energy transition, but we also help communities achieve energy self-sufficiency and environmental sustainability.

To learn more about our innovative solutions and how we can assist you in your energy transition, visit our website: wecobatteries.com.

See you at the next in-depth review!