Project sizes are increasing, larger-format modules are top of mind, and finding new cost efficiencies is a priority for companies across all market segments.

The IEA forecasts that additions of renewable electricity capacity will decline by 13% in 2020 compared with 2019, the first downward trend since 2000. This is a 20% downward revision compared to our previous forecast in which 2020 was due to be a record year for renewable power. The update reflects both possible delays in construction activity due to supply chain disruptions, lockdown measures and social‑distancing guidelines, and emerging financing challenges. The outlook also takes into account ongoing policy uncertainty and market developments such as the most recent auctions and newly financed projects before the Covid-19 outbreak.

However, the majority of these delayed projects are expected to come online in 2021 and lead to a rebound in capacity additions. As a result, 2021 is forecast to almost reach the level of renewable capacity additions of 2019. Despite the rebound, the combined growth in 2020 and 2021 is almost 10% lower compared to the previous IEA forecast.

The updated forecast revises down combined capacity growth in 2020 and 2021 by almost 10%. The drivers behind this revision vary by technology and country (details in the technology sections). The distributed PV forecast is revised downwards by the largest proportion, almost 36%, mainly in Europe, China and the United States. The forecast for utility-scale PV remains mostly unchanged except in the United States, where larger pipelines of utility-scale projects prior to Covid-19 underpin more optimistic growth. For wind, the European Union, China and India are mainly responsible for the downward forecast revision in 2020 and 2021. Forecast revisions for hydropower, bioenergy and other renewables are not directly connected to Covid-19. The forecast for hydropower integrates new project commissioning dates, based on recent construction activity since our previous forecast.