Demand for renewable energy is accelerating. It's undeniable. Between significant recent policy revisions to renewable goals like those in Oregon, California, New York and others, and businesses making huge commitments like the recent Wind XI proposal by MidAmerican Energy Company to add 2,000 megawatts of wind generation in Iowa—the signs are everywhere and cannot easily be dismissed. And just this week we reached the incredible milestone of more than one million solar installations across the U.S.—#millionsolarstrong. That's enough to power the equivalent of over 5 million homes and is expected to double in the next two years and potentially double again by 2020, with the right public policies in place.
The technologies being deployed are proven and are increasingly becoming cost competitive which is a sign of the industry's maturity. In a competitive industry, like what solar is becoming, companies are occasionally going to make high-risk moves in an attempt to gain an edge. SunEdison's recent Chapter 11 bankruptcy filing is mainly the result of rapid growth and excessive debt driven to unmanageable levels. But despite SunEdison's setback, the forecast for growth in the clean energy sector and solar specifically remain stunningly high—and we have the evidence to prove it.
High Demand and Declining Costs
States are continuing to reap the benefits of switching to clean energy. A recent report from LBNL cites that since 2000, 60 percent of all growth in renewable electricity generation is associated with state renewable portfolio standards (RPS)—a requirement that a minimum percent of electricity come from renewable energy sources. And many states are ambitiously and appropriately increasing their renewables standards, for good reason—in 2013 alone, the LBNL report found that RPSs provided consumer savings of $1.3 to $4.9 billion from electricity and natural gas savings, support for 200,000 RE-related jobs, $5.2 billion in health benefits from reduced air pollution, and $2.2 billion in global climate benefits.
California and Oregon have both set goals of meeting 50 percent of their electricity demand from renewable resources by 2030 and 2040 respectively and Hawaii requiring 100 percent by 2045. Taking into account these and other state targets, total U.S. renewable portfolio standard demand will increase from 215 TWh in 2015 to 431 TWh in 2030 (even before accounting for the latest commitments by New York) driving demand growth in renewable energy resources as well as the good jobs, cleaner air, lower energy costs, and the vital hedge we need against climate change's worst effects.
As well, the federal tax credits for wind and solar power development that Congress wisely renewed and reinstated as part of last year's omnibus spending bill will on their own help deploy as many as 53 gigawatts of wind and solar power by 2020—enough to power the equivalent of 14 million homes. Couple this with demand from state renewable portfolio standards and the rapidly declining costs and consensus among a range of industry experts is that the next five years will be ones of unprecedented growth in clean energy. Bloomberg New Energy Finance, for example, projects that wind and solar capacity will grow by 59 percent and 233 percent from today's levels, respectively, by the end of 2021. Recent reports from the National Renewable Energy Laboratory and the Rhodium Group expect similar levels.
So what's next for this rapidly growing industry? Investors and executives need to take advantage and fully tap into this huge market opportunity. This means finding successful market strategies and continuing to strengthen investor confidence. While some companies will make bets that don't pay off, as happened with SunEdison, there is still plenty of value in the project pipeline. Global clean energy revenue last year topped $1.35 trillion.
As investor confidence grows and new strategies are deployed, federal, state, and local policies need to continue to help drive these investments. This is important to achieving our clean energy objectives and cutting harmful carbon pollution. And this has the added benefit of creating jobs, saving businesses and consumers' money and ensuring America remains a global leader in clean energy technologies in the 21st century.