Clean energy investment is outpacing spending on fossil fuels as concerns over affordability and energy security drive momentum toward sustainable alternatives. international energy agency (IEA). The report states that global investment in clean energy is expected to reach US$1.7 trillion in 2023, surpassing US$1 trillion investment in coal, gas and oil. The report also highlights a significant increase in annual clean energy investment, which is projected to increase by 24% between 2021 and 2023, compared to a 15% increase in fossil fuel investment during the same period.
The growth in clean energy investment is mainly driven by renewable energy and electric vehicles, with advanced economies and China accounting for more than 90% of the growth. IEA Executive Director, Fateh Birol, emphasized the pace at which clean energy is advancing, with the ratio of investment in clean energy to fossil fuels now standing at 1.7 to 1, compared to a one-to-one ratio five years ago. Solar energy investment is particularly notable, as it is expected to exceed investment in oil production for the first time.
Low-emission power technologies, led by solar, are projected to account for about 90% of investment in electricity generation. With sales of electric vehicles expected to increase by a third in 2023, consumers are contributing to increased clean energy investment through increased purchases of heat pumps and electric vehicles.
Several factors have contributed to a boost in clean energy investment, including strong economic growth, volatile fossil fuel prices, and concerns about energy security, particularly following geopolitical events. Policy support in the US, Europe, Japan, China and elsewhere has also played an important role in boosting clean energy investment.
However, the report highlights the need for increased clean energy investment in emerging and developing economies. While countries like India, parts of Brazil and Middle East While investments in solar and renewable energy have shown promising results, many other countries face challenges such as high interest rates, unclear policy frameworks, weak grid infrastructure, and financially strained utilities. The international community is called upon to invest in low-income economies where the private sector has been hesitant to invest.
Although fossil fuel investment is expected to rise again in 2023, surpassing the levels needed for the IEA’s net zero emissions by 2050 scenario, the report underscores the urgency of transitioning to clean energy and reducing dependence on fossil fuels Is. Record-high global coal demand in 2022 and projected coal investment levels for 2023 highlight the need for an accelerated clean energy transition to achieve climate goals.
The report emphasizes that the growing gap in clean energy investment between advanced economies and other regions poses risks to the global energy transition. Addressing this imbalance and increasing investment in clean energy around the world is critical to tackling climate change and ensuring a sustainable energy future.
The growth in clean energy investment is mainly driven by renewable energy and electric vehicles, with advanced economies and China accounting for more than 90% of the growth. IEA Executive Director, Fateh Birol, emphasized the pace at which clean energy is advancing, with the ratio of investment in clean energy to fossil fuels now standing at 1.7 to 1, compared to a one-to-one ratio five years ago. Solar energy investment is particularly notable, as it is expected to exceed investment in oil production for the first time.
Low-emission power technologies, led by solar, are projected to account for about 90% of investment in electricity generation. With sales of electric vehicles expected to increase by a third in 2023, consumers are contributing to increased clean energy investment through increased purchases of heat pumps and electric vehicles.
Several factors have contributed to a boost in clean energy investment, including strong economic growth, volatile fossil fuel prices, and concerns about energy security, particularly following geopolitical events. Policy support in the US, Europe, Japan, China and elsewhere has also played an important role in boosting clean energy investment.
However, the report highlights the need for increased clean energy investment in emerging and developing economies. While countries like India, parts of Brazil and Middle East While investments in solar and renewable energy have shown promising results, many other countries face challenges such as high interest rates, unclear policy frameworks, weak grid infrastructure, and financially strained utilities. The international community is called upon to invest in low-income economies where the private sector has been hesitant to invest.
Although fossil fuel investment is expected to rise again in 2023, surpassing the levels needed for the IEA’s net zero emissions by 2050 scenario, the report underscores the urgency of transitioning to clean energy and reducing dependence on fossil fuels Is. Record-high global coal demand in 2022 and projected coal investment levels for 2023 highlight the need for an accelerated clean energy transition to achieve climate goals.
The report emphasizes that the growing gap in clean energy investment between advanced economies and other regions poses risks to the global energy transition. Addressing this imbalance and increasing investment in clean energy around the world is critical to tackling climate change and ensuring a sustainable energy future.