Development of the renewable energy industry

Renewable energy is developing rapidly around the world. In some countries, the growth of solar and other RES markets is very intense, while in others it is just beginning. But in any case, the inevitable increase in the share of clean energy sources in the global energy balance is a fact that cannot be ignored.

Annual global energy investment in 2021 is expected to grow to 1.9 trillion. dollars and exceed the total annual investment to pre-crisis levels. Their structure is gradually changing in the direction of reducing production and reducing consumption of traditional fuels. Thus, the International Energy Agency forecasts that in 2021 global energy demand will increase by 4.6%, which compensates for the corresponding reduction of 4% in 2020.

The expected rise in investment in 2021 is the result of a cyclical response to the recovery of the world and a structural shift in capital flows towards cleaner technologies. But despite the urgent need to move to a more sustainable energy path, global carbon dioxide (CO2) emissions are rising again after the largest annual decline in history in 2020.

Renewable energy sources continue to dominate investment in the new generation of electricity and are expected to account for about 70% of the total amount spent on all new capacity in 2021. The rest of the capital will be invested in networks and energy storage systems. Thanks to rapidly improving technology and reducing costs, every dollar spent on wind farms and photovoltaic systems today generates four times more electricity than the dollar spent on the same technology ten years ago.

The economic potential of any country largely depends on the state of its energy resources and the conditions of their use. That is why for economic growth Ukraine needs to more actively develop the use of alternative energy sources and energy efficiency. This is undoubtedly an important condition for ensuring the sustainable development of the national economy. In the context of Ukraine’s course on European integration and the simultaneous impact of corruption, rising inflation, economic and political instability, and other adverse factors, our economy needs effective and rapid reforms. One of the unconditional priorities in this direction should be to increase the overall investment attractiveness of the country.

Until recently, the most effective form of stimulating investment projects in renewable energy in Ukraine was state support for such projects through direct and indirect financing. But the situation is changing and the influence of the state is gradually beginning to diminish. Opportunities to invest in the alternative energy sector in Ukraine are potentially extremely favorable and without additional incentives, but problems with the consistency of public policy (more precisely – its obvious inconsistency) still constrain “green” investment.

It is the combination of global technological trends, available resources, and prudent state policy that can make the RES market the locomotive for the development of Ukraine’s economy as a whole. This will further create new companies and, as a result, hundreds of thousands of new jobs. Successful implementation of projects related to the introduction of clean technologies (including the use of solar energy), will help raise capital and provide an impetus for further monetary movement in other sectors of the economy.

Ukraine has been actively implementing solar energy solutions for more than 10 years and has great prospects to establish itself as one of the key “solar” markets (at least in Eastern Europe). The systematic development of the solar energy market will benefit everyone – project developers, investors, current and future owners of solar power plants, equipment suppliers and contractors, the state, ordinary citizens, and their families. This trend must not only be maintained but also actively developed today.

Summarizing the above, we can say that solar energy in Ukraine has prospects independent of government regulation, which are related to global trends. This makes this industry the most attractive for investment, gradually opening the Ukrainian market to investors from around the world. And the main task of the Solar Energy Association is to maximize the further development of the industry.

Dmytro Lukomsky,
Member of the Board of the Solar Energy Association of Ukraine,
founder of the Avenston group of companies,
has been involved in renewable energy projects since 2001.