Low-carbon energy investments witnessed a strong jump during the past year (2022), to reach a new record level, with the repercussions of the Russian invasion of Ukraine, which prompted the world to diversify sources of supplies.
Total global investment in low-carbon energy technologies increased by 31% year-on-year, reaching $1.1 trillion in 2022, according to a recent report by the Foundation. bloomberg New Energy Finance.
Not only that, but the report – which I have seen – indicates Energy Research Unit– indicates that low-carbon energy investments have reached parity with global spending on fossil fuel supplies for the first time ever.
Energy transition investments in the world
Almost every clean energy sector achieved a new record level of investment in 2022, including renewable energy, electricity storage, transport electrification, electric heating, carbon capture and storage, hydrogen, and sustainable materials, while nuclear energy investment remained roughly flat.
Sector investment rose sustainable energy By 17% on an annual basis, to reach $495 billion over the past year, to remain the most invested sector.
Spending on electrification of transportation – electric vehicles and related infrastructure – also saw a strong 54% increase last year, to $466 billion, rounding out investments related to renewables.
While investments went up hydrogen more than 3 times in 2022, to record $1.1 billion in 2022, but still equal to 0.1% of the total, despite strong interest from the private sector and growing government support.
The following graph shows global energy investments by sector between 2017 and 2022, according to data from the International Energy Agency:
The most investing countries
China was the leading country in low-carbon energy investments in 2022, with about $546 billion, which is nearly half of the global total.
Spending on energy transition technologies in the European Union reached $180 billion, led by Germany and France, according to the report, which was tracked by the Energy Research Unit.
While low-carbon energy investments in the United States reached $141 billion last year, they are on a strong increase, after approval Inflation Reduction Act The American, which provides huge incentives for clean technologies of no less than $ 369 billion.
Research firm Wood Mackenzie expects, in a recent report, that renewable energy investments alone in America will rise to $114 billion annually by 2031, compared to $64 billion last year.
Are the investments sufficient to achieve carbon neutrality?
In a milestone in 2022, global investment in the energy transition has equaled that of fossil fuel supplies at $1.1 trillion, for the first time ever.
Despite this, low-carbon energy investments still fall far short of what is required to achieve carbon neutrality by 2050; It should rise 3 times compared to the current level, according to estimates by Bloomberg New Energy Finance.
With the addition of $274 billion in investments in power grids, global spending on the energy transition will reach $1.38 trillion in 2022.
While Bloomberg believes that the world must invest an annual average of $ 4.55 trillion during the remaining years of this decade (2020), in order to be able to achieve Carbon neutrality by 2050.
related topics..
Also read..
