The Global Significance of Renewable Energy: Contributions to Economic Growth and Environmental Sustainability

Abstract

Renewable energy has moved from the margins of the global energy system to its leading edge, reshaping how electricity is generated, traded, and valued. This review synthesises recent evidence on the economic and environmental significance of renewable energy at a global scale. On the economic side, it examines investment trends, employment generation, the levelised cost of electricity (LCOE), energy security, and energy access, drawing on the latest data published by the International Renewable Energy Agency (IRENA), the International Energy Agency (IEA), and the International Labour Organization (ILO). On the environmental side, it reviews the contribution of renewables to greenhouse gas (GHG) mitigation, air quality, and the associated trade-offs in land, water, and material use. The review further discusses the policy architecture supporting the global energy transition, including the Paris Agreement and the COP28 tripling pledge, and identifies the principal barriers that continue to constrain deployment: grid integration and intermittency, storage costs, financing gaps in developing economies, and critical-mineral supply chains. The evidence indicates that renewable energy is no longer solely a climate mitigation tool but has become a central pillar of economic competitiveness, energy security, and industrial policy, while significant regional disparities in investment and employment remain a persistent challenge to an equitable global transition.