Renewable energy growth is outpacing fossil fuels for the first time

In 2023, new wind and solar installations outpaced all other components of the global energy mix, and clean energy investments are expected to exceed $2 trillion in 2024, accounting for two-thirds of global energy investments.

Significant wind and solar gains are among several “record levels in an energy-hungry world” listed in the latest Statistical Review of World Energy, published by oil major BP for decades before it handed the reins to the Energy Institute last year.

According to the review, 2023 will see “record consumption of fossil fuels and record energy emissions, but also record renewable production, driven by increasingly competitive wind and solar energy.”

While “transformation progress is slow,” the institute writes, “the bigger picture masks the diverse energy stories unfolding in different geographies.”

Wind and solar power accounted for 40% of total new energy in 2023. By 2024, solar and wind power growth was 67% higher compared to the previous year. Three quarters of this energy, or 346 gigawatts, came from solar power, and 115 gigawatts from wind. In both cases, China was the main installer.

“For the first time in history, newer forms of renewable energy have overtaken each of the fossil fuels that remain the world’s dominant energy sources,” writes Carbon Brief.

The Economist heralded the coming “solar era” when favorable developments in solar technologies, economics and supply chains will converge to result in exponential increases in solar energy efficiency.

“When solar power was one-tenth its current size 10 years ago, solar power was still viewed as marginal, even by experts who knew how quickly it was growing,” the weekly news report said. “The next 10-fold increase would be equivalent to multiplying the world’s entire fleet of nuclear reactors by eight in less time than it usually takes to build just one of them.”

Meanwhile, investment in renewable technologies will continue to exceed expectations, the International Energy Agency (IEA) predicts in its latest World Energy Investment report. In 2024, total global energy spending is expected to reach $3 trillion for the first time, of which $2 trillion will be allocated to clean energy technologies and infrastructure. Solar technology alone is expected to generate $500 billion in investments.

“Investment in clean energy has accelerated since 2020, with spending on renewable energy, grids and storage now higher than total spending on oil, gas and coal,” the IEA says.

However, another key investment in the energy transition – in the energy efficiency of buildings – is “below where it should be” and will continue to decline.

Meanwhile, investment in fossil fuels will continue to grow, with upstream oil and gas spending expected to rise 7% to $570 billion as prices for liquefied natural gas and coal rise. Oil and gas companies’ spending on clean energy in 2023 was approximately $30 billion, representing less than 4% of global clean energy investment.