Power Transition Trends 2023

As energy security concerns sparked by Russia’s invasion of Ukraine mounted last year, doubts arose regarding the feasibility of making meaningful progress on the energy transition. While the use of fossil fuels stepped up to meet demand, renewables are still making significant progress globally.

The rest of this decade will be decisive in determining whether the world achieves a net-zero emissions path. Policy mechanisms to address today’s energy challenges will influence how the future unfolds.

This annual report examines trends in global generation, capacity and emissions. Ahead of the COP28 climate summit, it aims to illustrate to policymakers, investors and other key stakeholders the state of the power sector globally through to the end of 2022. The report is based on data collected by BloombergNEF analysts on six continents from primary sources in 140 markets, along with aggregated data from the rest of the world.

By the numbers

  • Wind and solar accounted for 80% of the 424 gigawatts of new capacity installed last year. As a result, these two forms of renewables now make up 12.5% of global generation and more than a quarter of global capacity.
  • Global renewables generation reached a new high of 8.4 terawatt-hours in 2022, with an 8% jump in power demand compared to the previous year.
  • Zero-carbon technologies reached 46% of global installed capacity, up from 33% in 2012.
  • Although the energy transition is gaining momentum around the globe, over two-thirds of global renewables generation last year was concentrated in 10 markets.
  • Asia Pacific led the spike in global electricity production with a 6% year-on-year jump in 2022. Thanks to a strong economic growth, mainland China saw generation rise around 9%, to 8,600 terawatt-hours.
  • Latin America boasts the cleanest electricity matrix in the world, with over 60% of power coming from renewables. Brazil, Mexico, Argentina, Chile and Venezuela are responsible for 82% of the region’s installed renewables capacity.
  • More markets than ever are making renewable energy technologies their top choice. Some 67% of the world’s economies installed more renewables than fossil-fueled power last year, up from 39% in 2012. Solar was the technology of choice in nearly half the world’s economies.
  • Power sector emissions set a new record in 2022 at 13 billion metric tons of carbon dioxide. Emissions rose around 2% compared to 2021 levels, and over 4% from 2020. This was mainly due to the jump in coal- and natural gas-fired electricity generation once economies worldwide started to recover from the pandemic.
  • Fossil fuels’ share of new build slumped to the lowest ever last year, coming in at just 13%, compared to 50% in 2013. Natural gas led the decline, dropping to just 23 gigawatts added in 2022, versus 53 gigawatts in 2021. Coal was the top fossil fuel added last year, with 30 gigawatts of new build.
  • (Corrections were made to this report post-publication: The first bullet point on slide 1 has been amended to indicate that 424GW of new capacity was installed in 2022 and 12.5% of global generation is from wind and solar. The North America and Asia Pacific charts on slide 35 and the charts on slide 39 have been updated with the correct data. The legend of the right-hand side chart on slide 41 has been expanded to include Brazil and Mexico.)

BNEF clients can access the full report here.

About BloombergNEF

BloombergNEF (BNEF) is a strategic research provider covering global commodity markets and the disruptive technologies driving the transition to a low-carbon economy. Our expert coverage assesses pathways for the power, transport, industry, buildings and agriculture sectors to adapt to the energy transition. We help commodity trading, corporate strategy, finance and policy professionals navigate change and generate opportunities.
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