Renewable Energy Market to Witness Inevitable Downturn Due to the COVID-19 Pandemic

The renewable energy market can anticipate rising from USD 1.2 trillion in 2022 to USD 2.4 trillion by 2030, with a predicted CAGR of 10.10% between 2022 and 2030, believes Market Research Future (MRFR).

The primary source of renewable energy, also referred to as clean energy, is renewable natural resources. Wind energy, a sustainable energy source, is used to generate electricity from kinetic energy sources.

Renewable natural resources like wind and sunlight are used to create electricity. Solar, geothermal, wind, bioenergy, hydropower, and ocean power are a few of the key renewable energy sources. Currently, renewable energy is used for transportation, heating, and power. Renewable energy sources provide 7% of the world's energy requirements. Renewable energy is typically more expensive than fossil fuels. The idea that carbon dioxide (CO2) emissions from the burning of fossil fuels are to blame for global warming is the main motivation behind the usage of renewable energies.

Top Drivers and Barriers

The adoption of low-carbon fuels and the existence of stringent environmental regulations in the majority of developed countries have significantly boosted the market for renewable energy. Over the past several years, the installed capacity of renewable sources has expanded in the energy-generating sector as a result of growing environmental concerns and pressure to reduce the harmful effects of Greenhouse Gases (GHG). This has significantly contributed to the expansion of the solar and wind energy sectors.

The renewable energy sector has been successfully operating in the majority of developed countries due to the supportive policies and strategies as well as the widespread availability of biomass feedstock. Strict government emission regulations have led to an increase in the number of renewable energy installations across the nation.

It takes several years of observation to find a viable solar site and determine its viability. The employees must also acquire training in order to install, operate, and maintain the new technology. Some require operating in specific climatic conditions before they can be optimized for performance. This element may hinder the market growth for renewable energy during the projection period.

COVID 19 Analysis

Covid-19 poses a threat to investments made by individuals and small- to medium-sized organizations in renewable energy applications, such as distributed PV, solar thermal water heaters, heat pumps, and biomass boilers. These investments carry a higher risk of delay or even cancellation than large-scale undertakings.

Lockout procedures now make it impossible to enter houses and businesses, which has hampered the deployment of distributed solar PV in many countries. Additionally, if a person or small business is facing financial difficulty or economic uncertainty, they may opt to postpone or abandon their plans to put solar PV, solar thermal water heaters, or heat pumps on their property.

Market Segmentation

The main types of renewable energy are hydropower, wind power, solar power, bioenergy, geothermal energy, and ocean power. The solar energy renewable segment is anticipated to grow at the quickest rate between 2022 and 2030. In 2021, it dominated market expansion. In sunny climates, solar panels are a great alternative for homes and businesses since they can turn sunlight straight into electricity. Solar panels require a lot of space to operate effectively, and their original cost and continuous maintenance can be considerable.

The market has a slew of end users, some of whom are industrial, residential, and commercial sectors. The residential sector accounted for the largest renewable energy market in 2021, and it is predicted that it would grow at the highest rate between 2022 and 2030. 

Regional Insights

After reaching a staggering USD 0.5 billion in 2021, the Asia Pacific renewable energy market will see a remarkable CAGR of 43.60% during the study period. Increased investment in renewable energy projects has led to a dramatic increase in energy consumption in nations like China and India. In Asia-Pacific, it is predicted that both the household and industrial sectors will require more energy during the forecast period. India too has significant space for growth, but historically erratic economic circumstances and legal frameworks have led to a lower proportion of renewable energy in the nation's overall energy production. India is one of the countries in the Asia-Pacific market that has experienced the quickest growth as a result of increased investments in renewable energy projects.

Competitive Dashboard

ABB Ltd., General Electric (GE), The Tata Power Company Limited (Tata Power), Innergex, Enel Spa (Enel), Xcel Energy Inc. (Xcel Energy) are the top active players in the market for renewable energy.

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