As we have shown in this Global Electricity Review, the advance of renewable generation, spearheaded by wind and solar, has probably already caused fossil fuel use in the power sector to peak. 

This is good news for the planet, as building a clean electricity system worldwide is an essential step towards mitigating the worst impacts of global heating. Combined with rapid electrification of transport, heating and industry, the world can move to a pathway aligned with the 1.5C climate target agreed by all governments at the 2015 Paris summit. 

The continuing cost reductions for solar and wind power, battery storage, EVs and other key technologies show that a clean energy future is also a cheaper energy future. The supply and price shocks resulting from Russia’s invasion of Ukraine, and the OPEC+ supply cuts that have kept international oil prices high, illustrate the wider risks of continued reliance on fossil fuels. A rapid transition to a world running on clean energy would bring added benefits in areas such as air quality, jobs and freedom from import dependency, while reducing the risk of stranded fossil fuel assets. 

Government targets, industry forecasts and economic logic all indicate that the growth of wind and solar generation is likely to continue accelerating. G7 and IEA member governments have pledged to virtually decarbonise their electricity systems by 2035. The IEA forecasts that renewable energy will expand quickly enough in China to cut coal consumption by 3% in 2024. Delivering the pledge made at COP28 to triple renewables capacity by 2030 would mean renewables producing 60% of our electricity within seven years. The implications for fossil fuel use are stark, as this would eliminate more than one-third of their demand in the power sector by 2030, and make an impact beyond the power sector as well. 

However, the speed of global progress on decarbonising the power system is not certain, and challenges remain. Nuclear and hydro generation are not growing at the rates envisaged in many 1.5C-compatible scenarios. The pace of energy efficiency improvements across the world needs to double by 2030, along the lines agreed at COP28, to unlock the full fossil-fuel-shrinking potential of economy-wide electrification. Buildout of grid infrastructure and the system flexibility necessary to support high wind and solar capacities lags behind deployment of wind and solar, creating bottlenecks. Many developing countries face high financing costs for renewable electricity projects, and need financial support in order to take advantage of the opportunities that a faster rollout would bring.

Nevertheless, the big takeaway from 2023 is that solar and wind power are, right now, reshaping the global energy system, signalling the beginning of the end for the fossil fuel era.

From now on, increasing electricity demand will be met principally by the accelerating growth of wind and solar generation. The transition is at different stages in different countries, but it is happening in every region of the world. Societies will continue to develop on the back of increasing electricity use, but development will be powered by renewables instead, as the need for coal and gas eventually shrinks close to zero.  

From 2023 onwards, thanks to the rise of wind and solar generation and clean electrification, the future of energy looks very different indeed. The year will likely go down in history as the pivot point in the world’s shift from fossil fuels to clean electricity.