International Energy Agency: Newly installed global solar capacity will reach 310GW in 2024

Recently, the International Energy Agency (IEA) released a new market report on the outlook of the renewable energy market in 2023 and 2024.

Globally, new renewable energy capacity will soar from 107GW to more than 440GW by 2023, the largest increase ever, the report said. In 2023, solar energy will still be the main source of global renewable energy capacity expansion, accounting for 286GW, of which distributed photovoltaics will account for nearly half of the new capacity. This figure will grow to nearly 310GW by 2024 due to falling module prices, increased use of distributed PV systems, and a policy push for large-scale power station deployment.

However, the agency stated that since Law No. 14.300 has entered into force at the beginning of 2022, the distributed market has been changed. Between 2023 and 2024, Brazil will add less capacity; compared to its December 2021 forecast, the agency raised its forecast for renewable energy capacity additions in 2023 and 2024 by 38%.

"In the EU, residential and commercial solar PV systems account for 74% of our expected growth, with 82% of the increase coming from the six main markets of Germany, Spain, the Netherlands, France, Italy and Sweden," the agency added.

The IEA also said that the two main trends that prompted it to revise its forecast are the growing attractiveness of the business case for self-produced and sold energy since January 2021, and market conditions triggered by Russia's attack on Ukraine. The agency said it also raised its growth forecast for utility-scale PV systems, but to a much lesser extent due to licensing challenges, auctions with outstanding subscriptions and long development timelines.

Competitive auctions are expected to remain the dominant procurement method in Europe, accounting for at least 65% of the growth in renewable energy installations between 2022 and 2024.

"Nearly half of this increase will come from auctions of two-way fixed-spread contracts led by Poland, the UK, France, Italy and Spain," the IEA said.

Power purchase agreements (PPAs) and commercial plants are expected to account for 22% of new energy capacity additions in Europe by 2024. Corporate PPAs, led by Spain, Sweden, Germany, the Netherlands and Denmark, will account for the majority of the unused project share. Some unsubsidized projects are also likely to emerge in the UK, Italy and Poland, according to the IEA.

The agency also said: “While installations developed under full commercial models may be in the minority, PPA projects are expected to increase revenue by incorporating niche business models.”