BAKU, Azerbaijan, November 11. Global investments in energy transition are expected to reach $4 trillion by 2030, Fatih Birol, Executive Director of the International Energy Agency (IEA) said, Trend reports via the International Monetary Fund (IMF).
According to Birol, worldwide investments in energy transition only in 2022 are projected at $1.4 trillion.
“Global energy-related CO2 emissions rose by a record amount in 2021, and investment in clean energy technologies is still well below what it will take to bring emissions down to net zero by mid-century or soon thereafter,” he said.
At the same time, the decline in investment in recent years has led to some oil and gas producers not being able to expand production rapidly to meet today’s demand, even at record prices, the executive director noted.
“We risk seeing the worst of both worlds: the inability to provide for current energy needs and falling woefully short of what is needed to meet international climate goals. The good news is that investment in clean energy transitions is finally picking up. In the five years following the 2015 Paris Agreement, clean energy investment grew only 2 percent a year. However, since 2020, this rate has risen to 12 percent a year, led by increased spending on solar and wind power, including a record year for offshore wind power in 2021,” Birol explained.
As he pointed out, there is also a strong boost in other promising areas, such as low-emissions hydrogen; new battery technologies; and carbon capture, utilization, and storage (CCUS), even if this impressive growth is coming from a small base.
Birol noted that, although these investments are very significant, they mostly concentrate in advanced economies and China, which leaves emerging markets sometimes unable to attract sufficient investments in clean energy.
“In these economies, public funds for sustainable energy projects were already scarce and have become scarcer still since the COVID-19 pandemic. Policy frameworks are often weak, the economic outlook is uncertain, and borrowing costs are rising. After the pandemic hit, the number of Africans without access to electricity rose, wiping out years of progress on that crucial front,” he added.
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