[ECO]Global Solar Capacity Hits Milestone as COP29 Plans Financial Initiative

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Global solar capacity has reached 2 terawatts, a historic milestone achieved through rapid technological innovation and policy support.

Global solar capacity reached a historic milestone this month, reaching 2 terawatts of installed solar capacity worldwide. This achievement comes as industry leaders prepare for COP29 in Baku, Azerbaijan, where they will launch a new international solar finance initiative.

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confirmed that global solar capacity has doubled from 1 TW to 2 TW in just two years (2022-2024), a dramatic acceleration compared to the 68 years it took to reach the first terawatt between 1954 and 2022. This expansion in global solar capacity reflects major technological advances, including improved cell efficiency, enhanced manufacturing processes, and innovative module designs that have significantly reduced production costs.

Solar panel efficiency has increased from around 6% in the 1970s to over 20% in current commercial panels, with some advanced technologies reaching beyond 40% efficiency in laboratory settings. These improvements have contributed to the rapid expansion of global solar capacity. Manufacturing innovations, particularly in silicon purification and automated production lines, have driven down costs by more than 90% over the past decade, making solar power the most economical energy choice in many regions.

To put this milestone in perspective, current global solar capacity equals the combined total installed electricity capacity of India, the ******* States, and the ******* Kingdom. This amount of solar power could provide electricity to approximately one billion homes, based on average global household consumption of 3,500 kilowatt-hours annually with a 20% capacity factor.

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Two TW of solar power could provide electricity to approximately one billion homes. Photo by Sikwe Scarter on Unsplash

Successful government policies have played a crucial role in expanding global solar capacity. Notable examples include Germany’s Renewable Energy Sources Act, which pioneered the feed-in tariff model and helped establish the modern solar industry. China’s aggressive manufacturing subsidies and installation targets have transformed the global market, while the U.S. Investment Tax Credit has spurred significant private sector investment. These policy frameworks have created stable markets that encouraged technological innovation and cost reduction.

According to Global Solar Council CEO Sonia Dunlop, the achievement represents the installation of roughly 7 billion solar panels worldwide, driven by effective policies, industrial innovation, and the efforts of 7 million solar installers globally. However, Dunlop emphasized that meeting climate goals requires doubling current global solar capacity growth rates to reach 1 TW of new capacity annually.

The solar manufacturing sector has demonstrated its capability to meet growing demand, with current global manufacturing capacity reaching 1.1 TW. Annual installation rates have climbed to approximately 500 gigawatts. Despite this production capability, financing ******** a significant obstacle to achieving the desired 1 TW annual installation target.

A key challenge ***** in the cost of capital for solar projects, particularly in developing nations. Current financing costs in these markets can reach 15%, making many projects economically unfeasible. The industry aims to reduce these costs to 5% or lower to accelerate deployment and maintain the current pace of global solar capacity expansion.

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To address these financial barriers, the Global Solar Council will establish the International Solar Finance Group at COP29 on November 15 in Baku. This initiative will create the first worldwide platform connecting the solar PV industry with the finance sector. The group aims to develop innovative financial solutions to make solar investments more accessible, particularly in emerging markets.

This finance initiative’s timing aligns with COP29’s focus on financial solutions for climate action. The new group will facilitate dialogue between private sector investors and development banks to create frameworks that enhance solar project financing availability.

Solar power has become many countries’ most cost-effective energy source, driven by technological advances and economies of scale. This cost advantage, combined with the industry’s proven ability to scale rapidly, positions solar energy as the world’s leading renewable energy source by 2030.

The recent global solar capacity milestone contributes to the goal of tripling renewable energy capacity by 2030, which climate scientists identify as crucial for maintaining a pathway to limit global temperature rise to 1.5 degrees Celsius. However, reaching this target requires addressing persistent financing challenges, particularly in emerging and developing markets.

As the industry celebrates this milestone, the focus shifts to the upcoming COP29 meetings, where the International Solar Finance Group will work to create practical solutions for accelerating solar deployment worldwide. The success of these initiatives could determine whether the global community can meet its ambitious climate and sustainable development commitments through expanded solar energy adoption.

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