- In 2023, renewable capacity increased by an unprecedented 14 per cent, making renewable energy the fastest-growing source of electricity.
- Enhancing the system’s flexibility and significantly increasing electricity storage capacities cost-effectively have thus become crucial to ensuring the security of the energy supply.
The world saw an unprecedented 14 per cent increase in renewable capacity in 2023, making renewable energy the fastest-growing source of electricity. Yet, this record progress is nowhere near the tripling renewable power generation capacity target pledged at COP28.
As the world races to achieve 11.2 Terawatts of renewable capacity by 2030, integrating renewable sources into the power grid becomes more vital. Accommodating higher shares of variable renewable energy (VRE) – i.e. wind and solar – in the power system would require modernising existing infrastructure.
Lagged infrastructure development and inefficiencies in power grids are some of the energy transition barriers identified by the International Renewable Energy Agency (IRENA).
A future power system that allows high VRE shares and more electrification in the end-use sectors calls for enhancements and upgrades of existing grid infrastructure. Grid reinforcements, storage capacities, digitalisation, and smart solutions need to accelerate to foster VRE deployment.
Enhancing the system’s flexibility and significantly increasing electricity storage capacities cost-effectively has thus become crucial to ensuring the security of the energy supply. A battery storage system is necessary to achieve flexible and resilient power systems.
Solutions that intelligently direct solar generation to daytime loads or storage for night-time use will cut the cost of grid integration.
Digitalisation is particularly key in increasingly decentralised systems with high shares of distributed energy resources. It enables the management of data, coordination, and interaction among all system actors. By using real-time data and communication technology, system operators can have better power grid situational awareness—including more accurate weather forecasting—which enhances the system’s efficiency and flexibility.
This, in turn, will unlock great flexibility potential on the demand side, optimise operations, and improve system reliability. This, in turn, will facilitate higher VRE penetration in the power system. In addition, IRENA analysis shows that sector coupling – the process of interconnecting the power sector with the broader energy sector (e.g. heat, gas, mobility) – can be a key source of flexibility for the power sector while decarbonising the end-use sectors.
Through approaches such as electrification and thermal energy storage, the various end-use sectors can provide services such as heating, cooling and transport. Coupling different sectors, along with the support of intelligent energy management systems, can broaden the options for dispatching renewable power with greater grid flexibility to the system.
On the ground, implementing solutions for the integration of VRE comes from the synergies of different innovations across different dimensions, such as technology, market design, business models and systems operation. This is called systemic innovation.
Modernising and expanding infrastructure for an energy system that relies on VRE is capital-intensive. To triple renewables capacity by 2030, USD 720 billion on average must flow annually between 2024 and 2030 (inclusive) to grids, electricity storage, demand-side management, and other supply-side flexibility options.
But the world has sufficient capital available. To drive the capital toward infrastructure transformation, IRENA urges countries to take these actions, including providing incentives for infrastructure investments where market barriers exist. Streamline permitting procedures for large-scale infrastructure without compromising environmental and social impact assessments and foster public acceptance. Also, Provide public finance for the development of the required infrastructure.
Without accelerated investments in infrastructure and system operation, 11.2 TW of renewables capacity by 2030 would be a distant destination. These investments will ultimately lead to achieving energy transitions, climate goals, green industrialisation, and sustainable development growth.