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Investment in clean energy technology surged 17% last year to a record $1.77 trillion, according to new data from BloombergNEF (BNEF).
Figures published this morning by an influential analyst firm reveal that the electrified transport sector outpaced the renewable energy sector for the first time last year.
Spending on electric cars, buses, two-wheelers, three-wheelers and commercial vehicles jumped to $634 billion, compared to $634 billion for investments in solar, wind and other renewable energy technologies, the analysis found. It was revealed.
The grid ranks third in the clean energy rankings evaluated by BNEF. Energy transition investment trends in 2024 According to the report, $310 billion is being invested in transmission and connectivity infrastructure.
Meanwhile, investment in the hydrogen sector tripled, and spending on carbon capture and storage projects almost doubled year-on-year, albeit from a lower base.
However, despite strong growth across the clean technology sector, BNEF estimates that each year needed between 2024 and 2030 to meet the internationally agreed goal of limiting temperature rise to 1.5 degrees Celsius He warned that investment levels are “nowhere near” reaching $4.8 trillion.
“Our report shows how rapidly clean energy opportunities are expanding and how far off track we still are,” said Albert Chan, Deputy CEO of BNEF. ” he said. “Energy transition investment spending increased by 17% last year, but will need to increase by more than 170% to be on track for net zero over the next few years. Only decisive action from policymakers will lead to this kind of You can solve the gradual changes in ‘momentum’. ”
Although China still contributes more than twice as much spending as other countries, China’s advantage in clean energy technology investment diminished slightly in 2023 as the Inflation Control Act (IRA) triggered a wave of green investment in the United States. .
According to the report, investment in the US in 2022 will reach $303 billion, an increase of 22% year-on-year, compared to the EU, US and UK, which together recorded $718 billion in investment in 12 months, surpassing China. It means overtaking.
However, China still accounted for more than one-third of the total energy transition investment in 2023, with a total of $676 billion invested.
On supply chain investment, BNEF said its findings show that investment is developing at a sufficient pace in all clean energy sectors, except for the wind sector, and that investment is needed to put the net-zero pathway on track. I think there is a need to increase it. Overall, we forecast that investment in clean energy supply chains could reach £259bn by 2025, up from $135bn in 2023, and remain at just $46bn in 2020. I am.
The findings come after the International Energy Agency, which last year suggested that the rapid expansion of green economy supply chains should help continue to drive down the cost of clean technologies, despite continuing economy-wide inflationary pressures. reflects the analysis of
BNEF’s head of trade and supply chain, Antoine Vagnour-Jones, said: “Ample supply chain investment should continue to keep equipment prices contained in most sectors, which is good news for the energy transition.” “But the ensuing oversupply heralds an era that will squeeze profits for solar and battery manufacturers.”
Elsewhere, BNEF revealed that there was less encouraging news for clean technology companies from the stock market. The report found that companies were able to raise just $84 billion in equity capital for clean energy technologies in 2023, down from $127 billion in 2022 and half of the $168 billion raised in 2021. I confirmed that it was not too much. The analyst firm argued that this trend is due to rising interest rates, which are increasing the cost of capital. For businesses.
More than half of the equity raised in 2023 came from clean energy-focused companies, which raised $49 billion, according to the survey results. Meanwhile, companies in the clean transportation sector saw the sharpest decline in funding, from $47 billion in 2022 to just $18 billion last year.
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