Dramatically scaling up renewables in the global energy mix by 2030 would increase global gross domestic product (GDP), social welfare and employment worldwide, according to a new report released by the International Renewable Energy Agency (IRENA).
Renewable Energy Benefits: Measuring the Economics, finds that achieving a 36 per cent share of renewable energy in the global energy mix by 2030 would increase GDP by up to 1.1 per cent, roughly USD 1.3 trillion, more than the combined economies of Chile, South Africa and Switzerland as of today.
The report also analyses country-specific impact. Japan would see the largest positive GDP impact (2.3 per cent) but Australia, Brazil, Germany, Mexico, South Africa and South Korea would also see growth of more than 1 per cent each.
According to the report, improvements in human welfare would go well beyond gains in GDP thanks to a range of social and environmental benefits. The impact of renewable energy deployment on welfare is estimated to be three to four times larger than its impact on GDP, with global welfare increasing as much as 3.7 per cent.
Employment in the renewable energy sector would also increase from 9.2 million global jobs today, to more than 24 million by 2030, according to the report.
A transition towards greater shares of renewables in the global energy mix would also cause a shift in trade patterns, as it would more than halve global imports of coal and reduce oil and gas imports, benefiting large importers like Japan, India, Korea and the European Union. Fossil fuel exporting countries would also benefit from a diversified economy.
“Mitigating climate change through the deployment of renewable energy and achieving other socio-economic targets is no longer an either or equation,” said Adnan Z. Amin, IRENA’s Director General.
“Thanks to the growing business case for renewable energy, an investment in one is an investment in both. That is the definition of a win-win scenario.”