Renewable power will eclipse natural gas and nuclear as a source of electricity by 2016, with the sector expected to surge by 40 percent in the next five years, the International Energy Agency said Wednesday.
Even as governments curtail public subsidies and tax credits for hydro, wind and solar projects, the IEA study cited renewables as "the fastest-growing power-generation sector" and said it expects them to comprise a quarter of the world's power mix by 2018.
"As their costs continue to fall, renewable power sources are increasingly standing on their own merits versus new fossil-fuel generation," IEA Executive Director Maria van der Hoeven said in a statement.
"This is good news for a global energy system that needs to become cleaner and more diversified, but it should not be an excuse for government complacency," she added.
According to the IEA, the impetus for renewables is based largely on emerging markets' ramping up investment to boost electrical capacity. Additionally, key renewable fuels are becoming more competitive with fossil fuels in ways that have helped drive down prices.
"Led by China, [emerging market] countries are expected to account for two-thirds of the global increase in renewable power generation between now and 2018," Van der Hoeven said.
The report's forecast runs counter to the struggles that renewables have faced in recent years. Renewable and other alternative energies have become less in demand as shale production transforms energy markets worldwide.
The generation capacity of nonhydro power sources such as wind, solar, bioenergy and geothermal will double, reaching 8 percent by 2018, according to the report. The use of biofuels for transportation is also on the rise and will grow by over 25 percent, it said.
Renewable energy will be especially integral to electricity production, said the agency. Last year it projected that renewable electricity generation would rise by 40 percent through 2018.