A study released recently by media syndicate Bloomberg shows renewable energy sources -- including large hydropower projects -- will account for between 69% and 74% of all power generation investments through 2030.
Annual investment in new renewable power capacity is set to rise by anywhere from two-and-a-half times to four-and-a-half times by 2030, according to Bloomberg New Energy Finance (BNEF), with the likeliest scenario implying an increase of 230%.
BNEF said that figure equates to investments of US$630 billion in renewable energy sources per year by 2030 and reflects an increased interest in non-intermittent clean power like hydroelectricity and decreasing costs for development.
"The news right now is dominated by stories of pain caused by overcapacity on the supply side of clean energy and the lure of cheap shale gas," BNEF chief executive Michael Liebreich said. "But this is playing out against the falling costs of renewable energy and all of the technologies required to integrate it into our energy system, and falling costs win. What it suggests is that we are beyond the tipping point towards a cleaner energy future."
Bloomberg's predictions come from its "Global Energy and Emissions Model", which, BNEF said, "integrates all of the main determinates of the energy future, including economic prosperity, global and regional demand growth, the evolution of technology costs, likely developments in policies to combat climate change, and trends in fossil fuel markets."
These factors work together to form three scenarios, which BNEF calls the "New Normal", "Barrier Busting" and "Traditional Territory".
BNEF said the "New Normal" scenario is considered the most likely and that its projected clean energy investment in 2030 ($630 billion in nominal terms) represents an increase of more than three times the investments made in renewable energy capacity that was built in 2012.
Furthermore, BNEF said, this projection is 35% higher than the numbers its Global Energy and Emissions Model produced a year ago.
"This is the first time we have produced such detailed analysis of the future world energy system under different scenarios," said Gay Turner, BNEF head of economics and commodities. "It highlights that, in spite of the recent news showing a downturn in clean energy investment since 2011, renewable technologies will form the anchor of new generating capacity additions -- even under a less optimistic view of the world economy policy choices."
The study notes that sources like hydro, geothermal and biomass investments will be particularly important in helping provide grid stability and load management options, while investments in solar and wind generation will also increase as technologies become cheaper and more commercially viable.
"The main driver for future growth of the renewable sector over this timeframe is a shift from policy support to falling costs and natural demand," Turner said. "Our work also highlights, however, the importance of planning for the integration of intermittent renewables into the grid and into power markets."