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The year 2015 was an extraordinary one for renewable energy, with the largest global capacity additions seen to date, although challenges remain, particularly beyond the power sector. The year saw several developments that all have a bearing on renewable energy, including a dramatic decline in global fossil fuel prices; a series of announcements regarding the lowest-ever prices for renewable power long-term contracts; a significant increase in attention to energy storage; and a historic climate agreement in Paris that brought together the global community. Renewables are now established around the world as mainstream sources of energy. Rapid growth, particularly in the power sector, is driven by several factors, including the improving cost-competiveness of renewable technologies, dedicated policy initiatives, better access to financing, energy security and environmental concerns, growing demand for energy in developing and emerging economies, and the need for access to modern energy. Consequently, new markets for both centralized and distributed renewable energy are emerging in all regions. 2015 was a year of firsts and high-profile agreements and announcements related to renewable energy. These include commitments by both the G7 and the G20 to accelerate access to renewable energy and to advance energy efficiency, and the United Nations General Assembly’s adoption of a dedicated Sustainable Development Goal on Sustainable Energy for All (SDG 7). The year’s events culminated in December at the United Nations Framework Convention on Climate Change’s (UNFCCC) 21st Conference of the Parties (COP21) in Paris, where 195 countries agreed to limit global warming to well below 2 degrees Celsius. A majority of countries committed to scaling up renewable energy and energy efficiency through their Intended Nationally Determined Contributions (INDCs). Out of the 189 countries that submitted INDCs, 147 countries mentioned renewable energy, and 167 countries mentioned energy efficiency; in addition, some countries committed to reforming their subsidies for fossil fuels. Precedent-setting commitments to renewable energy also were made by regional, state and local governments as well as by the private sector. Although many of the initiatives announced in Paris and elsewhere did not start to affect renewable markets in 2015, there already were signs that a global energy transition is under way. Renewable energy provided an estimated 19.2% of global final energy consumption in 2014, and growth in capacity and generation continued in 2015. An estimated 147 gigawatts (GW) of renewable power capacity was added in 2015, the largest annual increase ever, while renewable heat capacity increased by around 38 gigawatts thermal (GWth), and total biofuels production also rose. This growth occurred despite tumbling global prices for all fossil fuels, ongoing fossil fuel subsidies and other challenges facing renewables, including the integration of rising shares of renewable generation, policy and political instability, regulatory barriers and fiscal constraints. Global investment also climbed to a new record level, in spite of the plunge in fossil fuel prices, the strength of the US dollar (which reduced the dollar value of non-dollar investments), the continued weakness of the European economy and further declines in per unit costs of wind and solar photovoltaics (PV). For the sixth consecutive year, renewables outpaced fossil fuels for net investment in power capacity additions. Private investors stepped up their commitments to renewable energy significantly during 2015. The year witnessed both an increase in the number of large banks active in the renewables sector and an increase in loan size, with major new commitments from international investment firms to renewables and energy efficiency. New investment vehicles – including green bonds, crowdfunding and yieldcos – expanded during the year. Mainstream financing and securitization structures also continued to move into developing country markets as companies (particularly solar PV) and investors sought higher yield, even at the expense of higher risk. In parallel with growth in markets and investments, 2015 saw continued advances in renewable energy technologies, ongoing energy efficiency improvements, increased use of smart grid technologies and significant progress in hardware and software to support the integration of renewable energy, as well as progress in energy storage development and commercialization. The year also saw expanded use of heat pumps, which can be an energy-efficient solution for heating and cooling. Employment in the renewable energy sector (not including large-scale hydropower) increased in 2015 to an estimated  8.1 million jobs (direct and indirect). Solar PV and biofuels provided the largest numbers of renewable energy jobs. Largescale hydropower accounted for an additional 1.3 million direct jobs. Considering all renewable energy technologies, the leading employers in 2015 were China, Brazil, the United States and India.

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