Clean energy spending in government stimulus packages has increased by 50% since late October. You have reached an unprecedented level.
In the “Sustainable Recovery Tracker”, the International Energy Agency IEA follows the economic stimulus measures for renewable energies worldwide. The latest evaluation shows that government budgets for clean energy have increased to US$710 billion. That’s 40% more than after the 2008 global financial crisis.
However, the IEA also reports that there are worrying imbalances between regions. Most of these efforts are made in the “advanced economies”, i.e. countries with high per capita income and strong industrialization. Governments there want to spend more than 370 billion US dollars by the end of 2023. According to the IEA, this would help make a global net-zero emissions scenario for 2050 possible.
In emerging and developing countries, however, the budget for sustainable economic stimulus measures is only a tenth of the amount in advanced economies. This shows the very different financial and economic conditions.
In emerging and developing countries, there is a lack of money for sustainable economic stimulus measures
By the end of 2023, expenditures of around USD 52 billion are planned for sustainable renovation measures in the emerging and developing countries. According to the IEA, this is far from enough to achieve net zero emissions by 2050. In addition, it is unlikely that the situation will improve. After the Russian invasion of Ukraine, governments with already limited budgets would first have to ensure that people could afford food and energy. In order to create a trend reversal in the emerging and developing countries, international cooperation is crucial.
Even in advanced economies, delays could jeopardize the success of renewable energy stimulus measures. Dangers are delays in setting up government programs, disruptions in supply chains, labor shortages and financial insecurity. Projects come to a standstill. Measures on the consumer side – for example for building renovation or electric cars – are often too little known or too bureaucratic.
“The world needs to scale up its clean energy efforts massively this decade, particularly in developing countries, if we are to maintain hope of limiting global temperature rise to 1.5°C,” said IEA chief Fatih Birol .
A lot of money to buffer rising energy prices
According to the IEA, governments in countries in the northern hemisphere have supported households and companies with around 270 billion US dollars in energy costs since the start of the 2021 heating season. However, many measures that would actually reduce oil and gas demand have so far received too little support. The IEA counts among these, for example, heat pumps, better public transport, cycle paths and high-speed trains, as set out in a 10-point plan.
The billions spent on sustainable energy are small if you measure them against the $18.2 trillion in economic aid during the corona crisis. However, the IEA believes that government spending could mobilize up to $1.6 trillion in private investment in return.
12.4.2022 | Those: IEA | solarserver.de © Solarthemen Media GmbH
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