As per the annual World Energy Investment report released by the International Energy Agency, the world was now investing almost twice as much in clean energy compared to fossil fuels.
Jun 14, 2024
The global energy investment is set to exceed USD 3 trillion for the first time in 2024, with USD 2 trillion going to clean energy technologies and infrastructure, said the International Energy Agency, while releasing its annual World Energy Investment report.
As per the findings, investment in clean energy has accelerated since 2020, and spending on renewable power, grids and storage is now higher than total spending on oil, gas, and coal. While USD 2 trillion will be spent on clean energy technologies, the remainder, a little more than USD 1 trillion, will be going to coal, gas and oil.
The report noted that the world is now investing almost twice as much in clean energy compared to fossil fuels. In 2023, combined investment in renewable power, grids, energy efficiency and end-use, nuclear and other clean power, along with low-emissions fuels stood at USD 2003 billion, overtaking for the first time, the amount spent on fossil fuels, which stood at USD 1116 billion, it added.
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However, the impact on project economics has been partially offset by easing supply chain pressures and falling prices. Solar panel costs have decreased by 30 percent over the last two years, while prices for minerals and metals, crucial for energy transitions, have also sharply dropped, especially the metals required for batteries. The report warned of energy investment flow imbalances, particularly insufficient clean energy investments in EMDE outside China.
It said there were tentative signs of a pick-up in these investments, noting that clean energy investments were set to approach USD 320 billion in 2024, up by more than 50 percent since 2020. This was similar to the growth seen in advanced economies, registering more than 50 percent growth, although trailing China, which recorded 75 percent growth.
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The gains primarily came from higher investments in renewable power, now representing half of all power sector investments in these economies. Progress in India, Brazil, parts of Southeast Asia and Africa reflected new policy initiatives, well-managed public tenders, and improved grid infrastructure. Africa’s clean energy investments in 2024, at over USD 40 billion, were nearly double those in 2020, it added.
However, much more needed to be done. In most cases, this growth came from a very low base and many of the least-developed economies were being left behind (several faced acute problems servicing high levels of debt), said the report.
