The world added less than half of the new renewable energy capacity required to meet its climate goals last year, with growing energy demand and weak grid infrastructure slowing the shift from fossil fuels, according to a leading think tank on Thursday.
Global renewable capacity additions increased by 36% last year to reach around 473 gigawatts (GW), breaking the record for the 22nd consecutive year, said the Paris-based REN21, a research group that includes national governments and industry associations among its members.
But it fell far short of the 1,000 GW per year required to meet the world's climate commitments, the group said in its annual outlook report.
"The reality is that energy demand has increased simultaneously, especially in China, India and other developing economies," said Rana Adib, REN21's executive secretary.
REN21 said the renewables sector was being held back by a lack of investment in grid infrastructure, with an estimated 3,000 GW of projects still awaiting grid connections last year.
More effort was also needed to boost energy efficiency and phase out fossil fuel subsidies, which in G-20 countries alone stood at a record $1.3 trillion in 2022, it added.
Providing financial support for developing countries to build renewable capacity remains a major challenge, with financing costs sometimes as high as 20%, five times higher than those in wealthier nations, Adib said.
"The cost of capital has greatly increased globally, but increased in a disproportionately high way in developing economies," she said, adding that development finance was also falling short, accounting for only 1.4% of total global renewable investment last year.
Total global renewable investment reached $623 billion last year, up 8.1% compared to a year earlier, but an estimated $1.3 trillion is required every year to meet climate targets.
At COP28 climate talks last December, countries pledged to triple global renewable energy capacity and double energy efficiency by 2030, but Adib said setting targets was insufficient.
"We have the technology – 80% of CO2 emissions can be abated with existing technology – but we need the political will," she said.