IEA Boosts Renewable Energy Forecast, but Trump Tax Plan Might Hurt Industry

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IEA Boosts Renewable Energy Forecast, but Trump Tax Plan Might Hurt Industry

A new report expects growth in Canadian renewable energy capacity to slow in the next five years compared to earlier projections, a decrease that comes after Ontario scrapped a contentious clean energy program aimed at boosting wind and solar supplies.

Historically, the IEA has significantly underestimated growth in renewables, notably solar PV and its newly renamed report "Renewables 2017" (formerly titled Medium-Term Renewable Energy Market Report) is an attempt to redress fundamental failings over the last decade of forecasts.

Hydropower provides the most renewable energy, but the growth is in solar.

For the first time ever, solar photovoltaics (PV) additions to the grid rose faster than any other fuel, surpassing the net growth in coal and boosting renewables to account for nearly two-thirds of net new power capacity around the world past year. That production will be equal to about half the globe's coal power capacity, in a fraction of the time it took to build all that coal power.

The IEA said coal will still be the largest source of electricity generation in 2022, though "renewables close the generation gap with coal by half in just five years".

By 2022, India is expected to more than double its current renewable electricity capacity.

The IAE predicted that China, India and America would account for two-thirds of global renewable expansion by 2022 and that renewables would account for 30 percent of global power generation, up from 24 percent in 2016.

"Total solar PV capacity by then would exceed the combined total power capacities of India and Japan today".

India's moves to address the financial health of its utilities and tackle grid-integration issues drive a more optimistic forecast, according to IEA.

"What we are witnessing is the birth of a new era in solar PV (photovoltaic)", IEA executive director, Fatih Birol, said in a new report.

The IEA addressed the proposed tax plan, saying "the current uncertainty over proposed federal tax reforms, global trade, and energy policies could have implications for the relative economics of renewables and alter their expansion over the forecast period".

The stunning growth trajectories reflected in the IEA report show how quickly the transition to renewables can be underway when aggressive policies cut through the barriers to growth. The Modi government is working on an ambitious plan to increase the installed base of domestic renewable energy capacity to 175 Gigawatt by 2022.

Despite President Donald Trump's vow to bolster coal's position in the power market, the U.S.is expected to be the second-largest market for renewables. But even considering the explosive growth of solar and wind, coal will remain the largest source of electricity under the current scenario.

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