Global spending on renewable energy has broken records. But it’s still not enough

Luc Williams

Total clean energy investment spending increased 17% last year, according to Tuesday’s BloombergNEF report. to the level of USD 1.8 trillion. These include investments in renewable energy installations, purchase of electric vehicles, construction of hydrogen production systems and implementation of other technologies.

If we add other expenses, such as investments in the construction and modernization of transmission networks for clean energy supplies, the total financing of renewable energy in 2023 will reach approximately USD 2.8 trillion.

The record spending reflects the growing need for international efforts to fight climate change just after the hottest year on record, especially as even more heat is expected this year.

Far from the 2050 net zero target

However, to achieve net zero emissions by mid-century, the world needs to invest more than twice as much in clean technology, according to BNEF.

Global spending on the green energy transition is rising. In 2023, investments in renewable energy increased by 17%. /Bloomberg

Last year total spending on the energy transition were well below the more than $4.8 trillion that BNEF estimates will be needed each year from 2024 to 2030 to put the world on a net-zero emissions path.

BNEF warns that governments need to do even more in the coming years. Albert Cheung, deputy director general of BNEF, estimates that investment must increase by 170% for the world to gain momentum and achieve net zero emissions.

China is a leader in renewable energy investments

China remains by far the largest renewable energy market, spending USD 676 billion last year. However, this is an increase of only 6%. compared to 2022.

For comparison investments in the USA, Great Britain and Europe increased by at least 22% last year, to a total of $718 billion.

This increase was due in part to incentives included in the Inflation Reduction Act, the flagship U.S. climate law that is beginning to have a significant impact on U.S. renewable energy investment.

In the UK the increase in expenditure was driven by high sales of electric vehicles. However, across Europe, the increase in the total value of investments in renewable energy was helped by the growing demand for renewable energy sources.

China is the largest market for clean energy spending / Bloomberg

The largest expenditure on transport transformation

Spending on electric vehicles worldwide, they increased by 36%, to USD 634 billion. This made it the sector with the highest level of investment, higher than that of renewable energy, which gained 8%. to the level of USD 623 billion.

Investors have committed $310 billion to power networkswhich will be a key tool for delivering clean energy produced from new wind and photovoltaic farmswhich will make this sector the third largest market.

Some new technologies have seen rapid development. For example, investments in hydrogen tripled last year to $10.4 billion, showing growing interest in the technology, although large-scale commercial use of green hydrogen is still a long way off.


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