Arab News, Monday, May 29, 2023 | Thul-Qidah 9, 1444
Global investment in clean energy to reach over $1.7tn in 2023: IEA
Saudi Arabia:
As efforts to mitigate the effects of climate change gather pace around the
world, investment in clean energy is also witnessing a surge and is expected to
reach more than $1.7 trillion in 2023, according to the International Energy
Agency.
In its latest report, the IEA said the global
energy sector is likely to record investment worth around $2.8 trillion this
year of which 60.7 percent will go toward clean technologies.
As security and affordability issues brought on by
the global energy crisis gain strength, spending on clean energy technologies
will outpace spending on fossil fuels, the report predicted.
Green energy includes renewables, electric
vehicles, nuclear power, low-emissions fuels, efficiency improvements, and heat
pumps.
According to the report, the leftover global
energy investments — slightly over $1 trillion — will go toward coal, gas, and
oil.
“Clean energy is moving fast — faster than many
people realize. This is clear in the investment trends, where clean technologies
are pulling away from fossil fuels,” said IEA Executive Director Fatih Birol.
He added: “For every dollar invested in fossil
fuels, about $1.7 are now going into clean energy. Five years ago, this ratio
was one-to-one.”
The report also predicted that in 2023, spending
on solar power is due to hit more than $1 billion a day or $382 billion for the
year, while investment in oil production will stand at $371 billion.
From 2021 to 2023, annual investments in clean
energy are projected to rise by 24 percent, driven by renewables and electric
cars, compared to a 15 percent increase in investments in fossil fuels during
the same time frame.
The report noted that over 90 percent of this
increase emanates from developed nations and China. This poses a severe threat
of creating new energy divides if renewable energy transitions do not accelerate
elsewhere.
The IEA attributed the stimulated investments in
clean energy in recent years to rapid economic expansion and erratic fossil fuel
prices that fueled worries about energy security, particularly in the wake of
the Ukraine crisis.
Other factors impacting the jump in investments in
clean energy include significant policy support through initiatives in Europe,
Japan, China, and other regions as well as the US Inflation Reduction Act.