REN21 has released a report titled, “Renewables in Cities Global Status Report (REC) 2021” which provides an overview of the status, trends and developments of renewable energy in cities worldwide. REGlobal presents the key findings and the detailed analysis on global progress in cities in renewable energy from the report…
- Cities are critical to the energy transition. Cities account for around three-quarters of global final energy consumption and for a similar share of global energy-related carbon dioxide (CO2) emissions. Cities are home to more than 55 per cent of the global population, a share that continues to grow. They can play a crucial role in building a renewables based economy and become a driving force in achieving clean energy targets.
- Accelerating renewables in all sectors is crucial. Municipal action is essential in the power sector, but it is also needed in other end-use sectors that so far have lagged in the energy transition, despite representing the bulk of global energy use. Buildings, concentrated in and around urban centers, account for 33 per cent of total final energy consumption, and urban transport is responsible for 13 per cent.
- Global investment in renewable energy capacity has trended upward for the last decade. Global investment in new renewable energy capacity, including power and fuels (but not including hydropower projects larger than 50 megawatts) totalled USD 282.2 billion in 2019, up 1 per cent over 2018. In the first half of 2020, global investment in new renewable energy capacity rose 5 per cent relative to the first half of 2019. A combined 171 renewable energy projects were reported in the pipeline in cities worldwide in 2019, with total project costs of USD 31.2 billion.
- Citizens have been increasingly active in engaging in the energy transition. They are also playing a significant role in creating markets for renewable energy at the local level. Individual citizens have supported renewables in cities by choosing green tariffs, purchasing energy from green pay-as-you-go schemes and getting energy from peer-to-peer energy systems. Previously mainly a rural phenomenon, community energy projects have gained more footing in cities.
- Rising global climate movements have exerted pressure on city and national governments to adopt stricter local climate and energy policies. Partly in response to this, by the end of 2020, a record 1,852 municipal governments in 29 countries had issued climate emergencies and 231 municipal governments had submitted a climate action plan alongside their declaration.
- Deregulation and technological progress have enabled many city dwellers to become prosumers. Prosumers refer to people who are both consumers and producers of energy. It includes those who set up their own renewable energy systems connected to the grid.
- Municipal governments around the world have demonstrated leadership in advancing the energy and climate agendas. Local governments are pushing for higher ambition and more rapid change than at the national level. City governments have used different types of targets, policies and actions to demonstrate their ambition. In 2020, more than 1 billion people which makes around a quarter of the global urban population, lived in a city with a renewable energy target and/or policy (for a total of over 1,300 cities), and around 260 cities set new targets or passed new policies in 2020.
- Cities often have limited funds at their disposal. While cities represent more than 80 per cent of global gross domestic product and can contribute significantly to global investment in renewables, they have limited funds or depend on national governments to provide a significant amount of finance. During 2019 and 2020, municipal governments continued to struggle to finance and invest in renewable energy projects due in part to their inability to mobilise their own fiscal revenue collection and borrow money.
- Financing options to increase the shares of renewables in the power, heating and cooling, and transport sectors may be grouped into three categories. Government agents or private players may have their own capital available for funding renewable energy projects. If they do not have their own capital available, they may be able to raise funds through bonds, or make use of funds provided by other levels of government or external actors (such as local or domestic banks and development banks). Finally, they may participate in agreements such as Public-Private Partnerships (PPPs) or Power Purchase Agreements (PPAs) to leverage external funds for a given project.
- Key barriers for advancing renewables in urban settings of Sub-Saharan Africa fall into four categories. These include policy and regulatory environment, access to financial markets, level and quality of city data, and the need for building internal capacity and knowledge. Building support for renewable energy implementation will also facilitate private sector engagement in the sector.
Global Overview of Renewables in Cities
At a global level, renewable energy capacity has continued to grow in the power sector, where supportive policy frameworks have helped solar PV and wind power become the most affordable sources of new electricity nearly everywhere in the world. Renewable energy broke another record in 2019, with the total installed power capacity of renewables increasing more than 200 gigawatts (GW). The renewable power sector also demonstrated greater resilience than fossil fuels during the COVID-19 pandemic, as electricity supplied by renewables was the only source of power generation to grow in 2020.
By the end of 2020, city governments in at least 834 cities in 72 countries, covering 558 million people, had set renewable energy targets in at least one sector (power, heating and cooling, and/or transport), this includes around 617 cities with targets for 100 per cent renewables. Altogether, cities worldwide had a combined 1,088 renewable energy targets. Geographically, renewable energy targets have increased in all regions of the world, although most targets are in North America and Europe, followed by Asia. 1,852 municipal governments in 29 countries also issued climate emergencies.
By the end of 2020, more than 10,500 cities globally had adopted CO2 emission reduction targets, and around 800 cities had committed to net-zero emissions – up sharply from the 100 cities with such commitments by the end of 2019.
Unlike for renewable power, renewables in heating and transport have demonstrated greater vulnerability to global shocks, such as the COVID-19 pandemic, than other energy sources. Heating, cooling and transport are critical for shifting the entire energy sector to renewables, as they are responsible for around 80 per cent of final energy demand.
The movement towards 100 per cent renewable energy, particularly 100 per cent renewable electricity, has continued to gain traction. Globally, 617 cities had set 100 per cent targets for either municipal operations or city-wide energy use as of 2020, together totaling 653 targets. Most of these commitments are for the power sector only. Although most such targets aim for years in the 2030 to 2050 period, at least 125 cities (including 47 in the United States alone) already had achieved their 100 per cent renewable electricity targets by the end of 2020.
Impact of Covid 19 on drivers of renewable energy
In 2020, the unfolding of the COVID-19 pandemic and the government-initiated lockdowns to slow the spread of infections had major impacts on both cities and the drivers for renewables. Economic activity fell sharply in the early months of the pandemic, reducing energy demand globally and severely affecting urban energy use, notably in the transport sector. Physical distancing measures and fear of contagion led to an unprecedented drop in public transport ridership, greatly altering urban mobility patterns. These developments resulted in a shift in government (especially municipal) priorities. Although COVID-19 recovery plans were still being prepared as of early 2021, initial proposals emphasised local economic development and job creation, with some municipal governments announcing “green recovery” packages – including renewable energy options. Images of blue skies and clearer air during the early lockdowns helped to increase societal pressure towards reduced pollution and a green recovery.
Investment and financing in cities
China and India account for most of the renewable energy investment in Asia. Outside of these countries, the non-OECD Asia-Pacific region accounted for USD 15.2 billion of renewable energy investment in 2019, up 17 per cent from 2018 due largely to investment in off shore wind power in Chinese Taipei. In Japan, renewable energy investment totalled USD 16.5 billion in 2019, down 10 per cent from 2018.
Investment in renewable energy capacity in Africa and the Middle East fell per cent in 2019 to USD 15.2 billion, down from a record USD 16.5 billion invested in 2018. Most of this investment was in the United Arab Emirates, followed by South Africa and Kenya. Investment in renewable energy capacity across Latin America has grown markedly, up 43 percent in 2019 to a record USD 18.5 billion. Four countries dominated this investment: Brazil, Chile, Mexico and Argentina. PPPs, PPAs and development finance provide key support for projects in cities across the region. Investment in renewable energy capacity in Europe fell 7 per cent in 2019, to USD 54.6 billion, with large variations across countries and technologies. Most of the investment occurred in Spain, the Netherlands and the United Kingdom. In the United States investment grew 28 per cent in 2019 to USD 55.5 billion. Since 2015, a majority of renewable electricity capacity transactions in US cities have been supported by PPAs.
Drivers for renewable energy uptake
Supporting local economic development by attracting new industries and businesses, and creating local jobs; Mitigating climate change, since renewables can help cities reduce emissions that contribute to global warming and address urban vulnerabilities to the impacts of climate change; Adapting to climate change and enhancing resilience, since decentralised power generation from renewables can help make energy systems more resilient while reducing risks associated with dependence on external energy sources; Reducing expenses and managing costs, by limiting cities’ exposure to volatile fossil fuel prices and providing greater savings as the costs of electricity from solar photovoltaics (PV) and wind power continue to decline; Poverty alleviation, since greater access to energy and new opportunities for learning and jobs can help reduce energy poverty and support sustainable development; Ensuring a stable and secure energy supply; and Energy justice and democracy, with sustainable energy access supporting an inclusive and just transition, with energy for all.
City leadership networks and initiatives
Local governments have worked together in global and regional networks to raise their voice, increase their advocacy capacity and sharpen their role in the climate, sustainable development and energy debates. These networks include: the network of ICLEI – Local Governments for Sustainability wherein 1750 cities committed to sustainable urban development; 97 cities were part of the C40 Cities network which aims to collectively halve local greenhouse gas emissions by 2030; and 88 of the cities have signed on to Deadline 2020, a commitment to develop a climate action plan compatible with the Paris Agreement; the ASEAN Smart City Network, launched in 2018, also brought together 26 pilot cities in member states to work on smart, sustainable urban development. Other such initiatives include the Global Covenant of Mayors for Climate & Energy, the Covenant of Mayors for Sub-Saharan Africa, Mayors for Climate, and Race to Zero.
Special Focus: Status of renewables in Sub-Saharan African cities
Sub-Saharan Africa was home to an estimated 1.1 billion people in 2019, with around 40 per cent of this population living in urban areas. Energy consumption in Sub-Saharan Africa remains among the lowest in the world, at around 17 GJ per capita per year in 2018 (excluding Nigeria and South Africa), nearly five times below the world average (84 GJ per capita per year). Traditional biomass, mainly wood and charcoal, accounts for 66 per cent of total final energy consumption region-wide and is used across all non-transport sectors, making Sub-Saharan Africa the only region in the world with such heavy reliance on biomass. Despite the abundance of local renewable energy resources, renewables accounted for only 7 per cent of the total primary energy supply, 8 per cent of total final energy consumption and 26 per cent of power generation in the region as of 2018.
To represent the geographic and socio-economic diversity among Sub-Saharan African cities, 5 cities have been selected to assess the status of renewables. These are Cape Town (South Africa), Dakar (Senegal), Kampala (Uganda), Tsévié (Togo) and Yaoundé IV (Cameroon).
Cape Town has a much higher energy demand than the other four cities, reflecting its larger population as well as the relative economic advancement of South Africa. In the smaller cities (such as Tsévié), where the commercial and industrial sectors are less extensive, the residential sector accounts for a higher share of energy use. Meanwhile, in the bigger cities (Cape Town, Kampala and Dakar), where there is greater movement of people and goods, the transport sector plays a more prominent role in energy consumption. In the less-urbanised cities of the region, high shares of residential energy use (in the case of Tsévié, representing up to 73 per cent of final energy consumption) reflect the low levels of industrialisation of these economies.
Overall, the residential sector accounts for 65 per cent of total final energy consumption in Sub-Saharan Africa, compared to only 22 per cent globally. The transport sector accounts for the highest share of greenhouse gas emissions in the five cities. Vehicle emissions also are a major source of air pollution.
The full report can be accessed by clicking here