Renewable Energy Market Intelligence

Global Market Outlook on Renewable Energy

Global renewable energy installation has been increasing with a CAGR of 7.61 percent from 2010 to 2017. A total of 171 GW of renewable energy generation capacity addition was seen in the year 2018. This indicates a 63 percent increase in the capacity expansion of renewables.

•  Total renewable energy installation reached a 2,351 GW in 2018, which an increase of 7.82 percent compared to 2017. 61 percent of the renewable capacity addition in 2018 was from Asian region. By 2021 it is forecasted to reach 3044 GW
•  Almost 50 percent of the renewable energy contribution came from hydropower in the year 2018, followed by wind at 24 percent and solar 18 percent. Total Hydropower installation across the world reached to 1,293 GW. Solar and Wind installations reached to 486 GW & 564 GW respectively
• China leads the way for hydropower (322.87 GW), solar (175.03 GW) & wind (184.69 GW) in terms of installed capacity in 2018. Geothermal energy is most popular in the United States with an installed capacity of 2.54 GW
•  New technologies such Marine energy have been implemented in Republic of Korea leading to an installed capacity of 0.255 GW making it the world leader in this technology, followed by France at 0.218 GW of installed capacity. Brazil is the leading country when it comes to Bio energy (14.78 GW) of installed capacity

Global Outlook

Innovation & ease of digitization, increase in consumer demand, price parities are the key reasons for the transformation of the energy sector from conventional to renewables. The transition to renewable energy is possible but slow, also the advances is uneven among the various sectors. Amongst all the available technologies, Solar & wind stand out to be most preferred ones to cater to the demand. 

Renewable energy share by technology

• The year 2018, registered a 12.5 percent increase in the non-hydro renewable energy generation. Quarter of world's energy demand was met through renewable energy in 2018.
• China & United states accounted for almost 50 percent of the contribution of renewable based electricity generation in the year 2018.
• Solar & Wind saw the highest increase in contribution from 2017 to 2018. A 24 percent increase in the solar power and 20 percent increase in wind power was registered in 2018 across the globe.
• Due to decline in the component prices of solar and wind, the bid prices for renewables across the world dropped significantly. China & India lead the world on solar PV technologies.

Renewable power capacity by top 6 countries- 2018 Capacity

• The fact that the price and the performance of renewables is reaching parity with conventional sources is one of the key reasons, which has enabled these technologies to be recognized in the main stream along with conventional sources.
• China saw 68 percent increase in the solar installed capacity from 2018 to 2017. Similarly offshore wind energy in China contributes to 28 percent of the total renewable energy generation.
•  Brazil registered a huge increase in the renewables in the year 2018. On shore wind & solar PV are key contributors to Brazil's renewable energy mix. Onshore wind energy increased by 22 percent in 2017 while Solar PV increased to 1000 MW in 2019.

Porter's Five Forces Analysis 

Supplier Power

• Supplier has a certain amount of power in the reducing profit margins and the industry profitability for renewable energy.
• The more concentrated is the whole supplier's industry the higher is their bargaining power
• The advancement in technology has helped in reducing the cost of manufacturing and increased competition

Barriers to New Entrants

• The barrier for new entrant is medium due to the many support scheme offered by the government.
• The Barrier for New Entrant depend on the economics of scale, capital Investment, government policies and products differentiation.

Intensity of Rivalry

• Intensity of Rivalry is high due to the presence of new emerging companies globally. The presence of incentives and subsidies focused towards renewable energy has given it a boom for new companies to enter into the market.
• The presence of global warming has also increased the companies to focus of clear energy

Threat of Substitutes

• The obvious substitution for renewable energy would be electricity generated from fossil-fuel or nuclear power stations.
•  Economic benefits of renewable energy substitutes make this the most severe threat level in the industry

Buyer Power

•   Buyers power is medium due to the large number of small sized buyers, and small number of energy supplier
•   Buyer have medium power has they have the option to shift to different generators, due to the low cost that offered by energy supplier.
•   Energy buyers are more price sensitive in choosing the energy supplier.