Solar PV Dominates
Solar photovoltaic technology remains the leading source of global power generation investment, with $461 billion projected in 2024 across residential, commercial, industrial, and utility sectors. Investment is forecast to reach $571 billion by 2030 despite declining project costs.
China continues to dominate capacity additions, while Europe maintains strong installation momentum. In the United States, the Inflation Reduction Act provides long-term federal investment certainty, reinforcing solar’s competitiveness against fossil fuels. Declining module costs, short lead times, low operating expenses, and improving storage integration sustain solar’s growth trajectory.
Long-Term Fundamentals for Offshore Wind
Offshore wind faced challenges in 2023 despite investment rising from $61.0 billion to $62.4 billion. Project cancellations in Europe and the United States reflected supply chain constraints, rising financing costs, and regulatory uncertainty.
Regulatory intervention is beginning to restore confidence. The United Kingdom adjusted auction parameters, awarding 5.3GW of projects, and Masdar acquired a 50% stake in the 3GW Dogger Bank project. Offshore wind’s long-term fundamentals remain strong, particularly for coastal European nations and Asia-Pacific countries with limited onshore space. Floating wind is expected to gain traction in the 2030s.
Growth for Onshore Wind
Onshore wind recorded $135 billion in investment in 2023, with revenues forecast to reach $150 billion in 2024. Although overshadowed by solar and offshore wind, the technology remains essential to diversified renewable portfolios.
Geographic limitations of offshore wind and intermittency considerations in solar reinforce onshore wind’s importance. Cost pressures have eased, but OEM profitability remains under strain. Policy support in the United States and China continues to underpin long-term growth.
Reshoring of Equipment and Component Supply Chains
Energy security and geopolitical tensions are reshaping renewable supply chains. China retains dominance in solar manufacturing, particularly polysilicon production, but political and economic pressures are driving domestic manufacturing initiatives in the United States and Europe.
The US Inflation Reduction Act and the EU Net Zero Industry Act introduce local content requirements, creating incentives for new manufacturing facilities. Rising turbine sizes further increase transportation costs, strengthening the case for localized production.
Rise of PPAs: Alternative Financing Options
Power purchase agreements (PPAs) are expanding as corporations seek long-term renewable electricity contracts. A total of 53.6GW of PPAs are forecast for 2024, rising to 122GW by 2030.
Technology companies including Amazon, Meta, Alphabet, and Microsoft remain leading customers due to data center energy demand and clean energy commitments. PPAs provide revenue certainty for developers and facilitate project financing in an environment of higher capital costs.
Combined Offering of Renewables and Batteries
Battery energy storage systems (BESS) address renewable curtailment by storing excess generation for later use. Global BESS revenue reached $50.3 billion in 2023 and is forecast to reach $150 billion by 2030.
Grid-scale storage dominates the market, followed by residential and commercial sectors. Integrated renewables-plus-storage projects maximize asset value, enhance grid stability, and mitigate volatility in electricity pricing.
AI-Powered Software to Optimize Battery Dispatch
As electricity markets become more complex, AI-based optimisation software is emerging as a critical component of battery systems. Integrators increasingly shift toward software and services models to capture higher-margin recurring revenue streams.
AI and machine learning enhance forecasting accuracy, dispatch optimisation, and revenue stacking across energy markets. Software platforms are expected to become essential for both front-of-the-meter and behind-the-meter storage assets.
Demand Management and Virtual Power Plants
The rise of distributed energy resources increases grid management complexity. Virtual power plant platforms aggregate decentralised assets, storage systems, and controllable loads to function as a unified dispatchable resource.
AI-enabled VPP systems optimise demand shifting, enable bidirectional EV charging, and enhance grid flexibility. These platforms unlock revenue opportunities while supporting system stability amid rising renewable penetration.
Advanced Servicing Propositions
Aging generation assets and increasing competition elevate the importance of operational performance. Advanced servicing solutions improve efficiency, flexibility, and lifetime value of both renewable and conventional assets.
Multibrand servicing in wind and incremental investment approaches are identified as key strategies. Large-scale repowering of renewable assets is expected to become a significant growth area.
Grid Digitalization and Distributed Intelligence
Rising distributed solar, storage, and EV charging necessitate grid digitalisation. Utilities are deploying IoT-enabled devices, smart meters, and distributed intelligence solutions to ensure reliable power flows.
IT-OT convergence, big data analytics, and edge computing are transforming grid operations. Rather than solely upgrading physical infrastructure, utilities are increasingly investing in connectivity and digital coordination to manage diverse energy flows.
Future Technology Trends
Material innovation underpins ongoing renewable advancements. Solar PV efficiency improvements, new wind materials for cost reduction, and evolving battery chemistries—including sodium-based solutions—will shape the next decade.
Higher conductivity materials and grid technologies will further enhance transmission capacity within existing networks.
Industry Leaders to Watch
Masdar has expanded its global footprint through investments in large-scale renewable projects including Dogger Bank South, Terra-Gen, and Terna Energy, targeting 100GW of assets by 2030.
ACWA Power continues to expand renewable and hydrogen projects across the Middle East, Africa, and Asia, including participation in the NEOM renewable hydrogen development.
