REN21, a Paris-based policy group, said the global shift to renewables in major energy-consuming sectors slowed in 2023. Regulatory gaps, political pressures, and a failure to set clear targets hindered the growth.
The report adds, “Despite a notable decline in the prices of fossil fuels and other energy commodities in the first half of 2023, wholesale electricity prices remained high in many countries, negatively affecting energy-consuming sectors. Inflation and high interest rates continued to hamper investment, particularly in emerging markets that face debt burdens and a higher cost of capital. Meanwhile, massive subsidies to fossil fuels remain prevalent and have distorted the market, placing renewables at a disadvantage.”
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By the end of 2023, only 13 countries—including the United States, India, and China—had implemented renewable energy policies across buildings, industry, transport, and agriculture, with a mere 12.7% of the energy consumed by these sectors coming from clean sources.
The report added that many countries have even backtracked on their renewable energy plans. Out of 69 countries with renewable energy targets for end users, only 17 extended them beyond 2024.
REN21’s Executive Director, Rana Adib, said, “Governments have basically stepped back from their ambitions, and energy-consuming sectors don’t have the economic incentives anymore.”
As of 2023, only 13 countries had renewable energy policies for all four demand sectors (power, buildings, industry, and transport) in place.
The report highlights the need for integrated policies due to disparities in renewable deployment across different sectors.
Rana Adib added, “Policy efforts, such as the U.S. Inflation Reduction Act and the EU’s REPowerEU plan, have spurred renewable investments, but more needs to be done,”
