The development trend of clean energy under economic tension

Under the leadership of new solar energy, the world is increasing renewable energy at an extremely fast pace in 2023. If this trend is strengthened, it will help the Earth rid itself of fossil fuels and prevent severe warming and its impacts.

Clean energy is usually the cheapest now, which to some extent explains the reason for growth. According to the International Energy Agency, countries have also adopted policies to support renewable energy, with some countries considering energy security. These factors offset high interest rates and the ongoing challenges in obtaining materials and components in many places.

Another iconic year for solar energy

According to the International Renewable Energy Agency, China, Europe, and the United States have all set records for annual solar installation. China's new installed capacity outshines all other countries, at around 180 to 230 gigawatts, depending on the outcome of the year-end project. Europe has increased by 58 gigawatts.

Currently, solar energy is the cheapest form of electricity in most countries. Between December 2022 and November 2023, the prices of solar panels in Europe dropped significantly by 40% to 53%, currently at a historic low. "Especially in Europe, the speed of expanding deployment scale is indeed very fast," said Michael Taylor, senior analyst at IRENA

When the final data for 2023 is released, the global total solar power generation is expected to exceed hydropower, but in terms of actual power generation, hydropower will still generate more clean electricity for a period of time because it can generate electricity 24/7.

The challenges faced by wind energy

By the end of 2023, there will be enough wind energy added globally to power nearly 80 million households, which will be a record breaking year.

According to Wood Mackenzie's research, like solar energy, most of the growth comes from China. According to Global Energy Monitoring, if all planned projects are completed, China is expected to surpass its ambitious goal of 1200 gigawatts of solar and wind power installed capacity for public utilities by 2030 five years ahead of schedule.

The Global Wind Energy Council stated that China is one of the few wind power growth markets this year. Faster licensing and other improvements in major markets such as Germany and India also contribute to increasing more wind energy. But Wood Mackenzie stated that the installation volume in Europe decreased by 6% year-on-year.

Short term challenges such as high inflation, rising interest rates, and rising building material costs have forced some offshore wind power developers to renegotiate or even cancel project contracts, while some onshore wind power developers have postponed projects until 2024 or 2025. This year, global wind power construction has also slowed down. The top three markets for onshore wind energy this year are still China, the United States, and Germany, while the top three markets for offshore wind energy are still China, the United Kingdom, and Germany.

Battery Year

According to the International Energy Agency, as efforts continue to reduce the climate damage caused by transportation, the trend towards electric vehicles is expected to accelerate globally in 2023, with one fifth of the cars sold this year expected to be electric vehicles. This means that this year has also become another brilliant year in the battery industry.

According to the data of Atlas public policy, the US alone spent more than US $43.4 billion on battery manufacturing and battery recycling this year, which is largely due to the Inflation Reduction Act. This puts the United States and Europe in a fairer competitive environment, but still lags behind battery powerhouse China.

According to benchmark mineral intelligence data, as of the end of November, there were 38 large battery factories under construction in the United States and Europe respectively. But there are 295 projects under development in China.

Experts say that the industry continues to explore different methods of manufacturing batteries without overly relying on harmful materials, as well as methods to make components more sustainable, and the battery recycling industry has made progress.