Renewable Energy Market Outlook - 2030
The global renewable energy market was valued at $881.7billion in 2020, and is projected to reach $1,977.6 billion by 2030, growing at a CAGR of 8.4% from 2021 to 2030. Renewable energy, even referred as clean energy, is usually derived from natural sources that are constantly replenished. Wind energy, a type of renewable energy, is used to generate electric energy from kinetic energy source. Wind turbine converts the wind energy into mechanical energy, which is further converted into electrical energy through generator. Wind energy can be generated offshore and onshore. Onshore wind energy is associated with onshore turbines that are located on land, whereas offshore wind turbines are found in ocean or sea.
Renewable energy is derived from natural sources such as wind and sunlight. Solar, geothermal, wind, bioenergy, hydropower, and ocean power are some of the major sources of renewable energy. Currently, renewable energy is utilized in heating, electricity, cooling, and transport sectors. Renewable energy collectively provides around 7% of the world’s energy demand. Renewable energy is relatively more expensive than fossil fuel. Several factors are responsible to drive the usage of renewable energies, the most crucial being the attribution of global warming due to carbon dioxide (CO2) emission from the combustion of fossil fuels. The concern about the reduction of greenhouse gas emissions, increase in search for energy security along with the aversion to traditional nuclear power, and lack of progression in the application of the nuclear power are expected to drive the demand for geothermal power market during the forecast period. Governments of various developing and developed countries have focused on promoting renewable energy sources due to increase in output efficiency, less pollution, and low maintenance costs. All these factors collectively surge the demand for renewable energy, thereby augmenting the global renewable energy market growth.
However, developing new resources requires large initial investments to build infrastructure. These investments increase the cost of providing electricity, especially during early years. Initially, the developers need to find publicly acceptable sites with good resources and with access to transmission lines. Finding a potential solar site requires several years of monitoring to determine whether they are suitable or not. In addition, the workers need to be trained to install, operate, and maintain the new technologies. Some require operating experiences in certain climatic conditions, before the performance can be optimized. This factor is likely to restrain the growth of the renewable energy market during the forecast period.
On the contrary, economies such as China and India are expected to drive the demand for geothermal power sector. A significant increase in energy demand owing to surge in investment in renewable energy projects has been witnessed in countries such as China and India. The residential and industrial sectors are expected to consume more energy during the forecast period in Asia-Pacific. Furthermore, India has significant growth potential; however, due to its inconsistent policy and business environment in past, the renewable energy share in total energy production was less. There has been an increase in investments in renewable energy projects in India, owing to which it is one of the countries experiencing rapid growth in the Asia-Pacific market.
For instance, a shift in trend toward use of localized energy procurement can be seen in the recent years. Various government bodies in countries such as India have taken the advantage of community choice aggregation (CCA) policies, which permits government to procure renewable energy resources on behalf of their constituents while retaining their existing electricity provider for transmission and distribution services. All these factors are expected to offer future growth opportunities to the global renewable energy market.
The renewable energy market analysis is done on the basis of type, end-use, and region. On the basis of type, the market is categorized into hydroelectric power, wind power, bioenergy, solar energy, and geothermal energy. The end-user covered in the study includes residential, commercial, industrial, and others. Region wise, the market is studied across North America, Europe, Asia-Pacific, and LAMEA.
The major companies profiled in this report include ABB, Acciona, EDF, Enel Spa, General Electric, Innergex, Invenergy, National Grid Renewables, The Tata Power Company Limited (Tata Power), and Xcel Energy Inc.
The global market analysis covers in-depth information of the major renewable energy industry participants.
Renewable Energy Market, by Region
Asia-Pacific renewable energy market size is projected to grow at a CAGR of 9.6% during the forecast period and accounted for 35.2% of renewable energy market share in 2020. The region accounts for more than half of the global energy consumption, owing to rise in industrialization as well increase in population. The renewable energy market has grown considerably in countries such as China and India. China became the world’s largest producer of bioelectricity in 2017 and now it is one the key players in hydropower, onshore, wind power and solar photovoltaic, and.
Asia-Pacific would exhibit highest CAGR of 9.6% during 2021-2030.
Renewable Energy Market, by Type
In 2020, the hydroelectric power segment was the largest revenue generator, and it is anticipated to grow at a CAGR of 6.5% during the forecast period. A significant amount of hydropower development took place in Brazil. An increase in activity has been witnessed across the continent, with notable projects in Colombia and Peru. Surge in investments for off-grid energy generation and rural electrification across developing countries, such as India, China, Brazil, and Vietnam, has increased the demand for small hydropower plants. In addition, initiatives such as the Small Hydropower Programme by the Ministry of New and Renewable Energy and Rajiv Gandhi Grameen Vidyutikaran Yojana taken by the Government of India to electrify rural areas and promote the utilization of small hydropower energy for off-grid and mini-grid is expected to drive the growth of the market.
Solar energy type is the most lucrative segment
Renewable Energ Market, by End Use
By end use, the ryesidential segment acquired the top position of the global market in 2020, and it is anticipated to grow at a CAGR of 8.4% during the forecast period. Increase in use of geothermal heat pump in residential heating application is expected to drive the growth of the market. The requirement of geothermal power is expected to increase significantly with rise in demand for electricity. This factor is expected to drive the growth of the market. Several companies in the market offer geothermal power to the residential sectors. Enel Green Power is one such company that owns the power plants at a complex and serves approximately two million families, 8,700 residential & business customers, and 25ha of greenhouses. Implementation of government initiatives in developed as well as developing economies to curb carbon emission and to reduce the usage of conventional fuels to generate energy has increased the usage of rooftop solar energy systems to generate electricity for household purposes.
By End Use
Industrial end use is projected as the fastest growing segment
Key Benefits for Stakeholders
- Porter’s five forces analysis helps analyze the potential of buyers & suppliers and the competitive scenario of the industry for strategy building.
- It outlines the current renewable energy market trends and future estimations from 2020 to 2030 to understand the prevailing opportunities and potential investment pockets.
- The major countries in the region have been mapped according to their individual revenue contribution to the regional market.
- The key drivers, restraints, and opportunities and their detailed impact analysis are explained in the study.
- The profiles of key players and their key strategic developments are enlisted in the report.
Impact Of Covid-19 On The Global Renewable Energy Market
- The novel coronavirus is an incomparable global pandemic that has spread to over 180 countries and caused huge losses of lives and economy around the globe.
- The renewable energy market has been negatively impacted due to the wake of COVID-19 pandemic. The pandemic severely impacted the wind turbine manufacturing in countries such as China and Germany.
- For instance, in 2020, Germany's Nordex SE reported negative EBITDA of $86.5 million down from positive EBITDA of $21 million in previous financial year (2019). The limited availability of spares and manpower for maintenance due to the pandemic is a major problem that affects the market growth.
- During high wind season, planned maintenance has become a major issue for industry players, owing to reduced labor force and social distancing norms. Furthermore, project delays and cancellation of orders has affected the key markets for both blade production and wind turbine installations.
- For instance, Siemens Gamesa Renewable Energy SA accounted for a net loss of $577 million during its fiscal third quarter in 2020. However, a shift in trend toward domestic supply chain may reduce the reliance on foreign imports and encourage domestic production of wind turbines. In addition, implementation of digitization is expected to aid in remote monitoring of project execution; thus, limiting the labor force as much as possible.
Renewable Energy Market Report Highlights
By End Use
Key Market Players
EDF, Enel Spa, Innergex, THE TATA POWER COMPANY LIMITED (Tata Power), General Electric, Xcel Energy Inc., Geronimo Energy, ACCIONA, ABB, Invenergy
The global renewable energy market is expected to exhibit high growth potential owing to its use in residential, commercial, industrial, and others. There is a significant increase in energy demand in the residential sector owing to rise in population in Asia-Pacific. Renewable energy technologies that can be installed in building energy systems comprise: solar electric, or photovoltaic systems, solar thermal, including solar hot water and solar ventilation air preheating, geothermal heat pump, wind turbines, and biomass systems. Geothermal power is used in residential for heating and cooling, and electricity generation. In residential sector, geothermal energy is a good alternative of fossil fossils and can be used to produce electricity. Increasing use of geothermal heat pump in a residential heating application is expected to drive the growth of the market. As demand for electricity increases, it is expected that the requirement of geothermal power will increase significantly. This factor is expected to drive the growth of the market. Several companies in the market are offering geothermal power to the residential sectors. Enel Green Power is one such company that owns the power plants at the complex serving approximately two million families, 8,700 residential and business customers, and 25ha of greenhouses, which is predicted to offer lucrative growth opportunities in the future.
There has been a significant amount of hydropower development in Brazil. There is increase in activity across the continent, with notable projects in Colombia and Peru is the key market trend. Surge in investments in off-grid energy generation and rural electrification across the developing countries such as India, China, Brazil, and Vietnam have surged the demand for small hydropower plants.
In addition, initiatives such as the Small Hydropower Programme by the Ministry of New and Renewable Energy and Rajiv Gandhi Grameen Vidyutikaran Yojana taken by the Government of India to electrify rural areas and promote the utilization of small hydropower energy for off-grid and mini-grid is expected to drive the growth of the market. Significant surge in demand for renewable power sources is expected to drive the floating wind turbine market growth which further propels the growth of the renewable energy market. In addition, such turbines reduce carbon emission, unlike conventional power sources. Furthermore, the floating wind turbine technology, a type of offshore turbine, removes the constraint of water depth which aids in selecting the best site possible for power generation.