Global renewable energy capacity is to be tripled by 2030, according to G20 Declaration 2023

The recently concluded Group of 20 nations (G20) Summit had energy transition, renewable energy, and widespread access to energy high on its agenda. In the G20 New Delhi Declaration 2023, all nations agreed to triple renewable energy capacity globally by 2030. Directionally, it is a very important callout at a significant forum like G20 and reinforces the importance of the need to travel towards a high RE regime with urgency to deal with the emergent climate change issues, Anish De, global head of energy and natural resources, KPMG, told. The Declaration read: “We will pursue and encourage efforts to triple renewable energy capacity globally through existing targets and policies, as well as demonstrate similar ambition with respect to other zero and low-emission technologies, including abatement

According to De, it does imply a lot to be done in terms of manufacturing, supply chains, project development, etc. “While the messaging is important and implementation is hard, this is true across the world and also in India. But the prize of getting there in terms of clean energy, new employment, etc, is also significant,” he said. Even though investments in clean energy exceed those in fossil fuels at present, it will be a very challenging feat to achieve. “It has taken India and the world quite some time to get to the present. Tripling from here in short seven years is a massive activity that will inevitably face constraints and challenges,” said De.

He said that globally, this is one of the largest capital reallocation experiments in modern times and even though it is not impossible, the capital must find appropriate returns to be deployed at that scale so there will be some balancing. “Manufacturing and supply chains will be pushed because simultaneously we are trying to reduce the concentration risks of China. This will be challenging and there may also be inflationary pressures,” he added.

Global inflation is high resulting in a high cost of money, which would push up delivered costs. There are also issues of land, permitting, and transmission all of which have to be in sync and do not happen that way automatically. De added that there would be issues in getting access to skills on the scale required, so massive upskilling and reskilling will also be needed. “There are also issues around nature and biodiversity which come to be a challenge when you want to make a change so rapidly maintaining that balance between development and nature would be a very fine one,” he said.

In the Energy Transition Working Group under India’s G20 Presidency, the Ministry of New and Renewable Energy also led and co-led some priority areas including hydrogen and access to low-cost financing for energy transition. These were reflected in the New Delhi Leaders’ Declaration where all G20 nations agreed upon adoption of high-level principles of hydrogen and access to low-cost finance for energy transition especially in developing countries. It also noted that an estimated investment of $4 trillion per annum is needed for energy transition with a high share of renewable energy in the primary energy mix. The G20 New Delhi Declaration 2023 also took note of the Presidency’s initiative to establish the Green Hydrogen Innovation Centre steered by the International Solar Alliance.