Global investment in energy transition technologies last year—including energy efficiency—set a new record high with a 19% rise to $1.3 trillion from 2021 investment levels and 50% from before the pandemic in 2019, a joint report by the International Renewable Energy Agency (IRENA) and Climate Policy Initiative (CPI) revealed on Wednesday.
The report, Global Landscape of Renewable Energy Finance 2023, showed that although global investment in renewable energy reached a record high of $0.5 trillion in 2022, this still represents less than 40% of the average investment needed each year between 2021 and 2030, according to IRENA’s 1.5°C scenario.
IRENA Director-General, Francesco La Camera, said that achieving an energy transition in line with the 1.5°C scenario requires the redirection of $0.7 trillion per year from fossil fuels to energy-transition-related technologies.
La Camera also stated that for the energy transition to improve lives and livelihoods, governments and development partners need to ensure a more equitable flow of finance, by recognizing the different contexts and needs.
Investments are not on track to achieve the goals set by the 2030 Agenda for Sustainable Development.
Despite reaching record-high annual investments exceeding $0.5 billion in 2021, investment in off-grid renewable solutions falls far short of the $2.3 billion needed annually in the sector between 2021 and 2030.
In 2020, solar photovoltaics alone attracted 43% of the total investment in renewables, followed by onshore and offshore wind at 35% and 12%, respectively.
When comparing renewables financing across countries and regions, the report finds that significant disparities have grown over the last six years.
About 70% of the world’s population, mostly residing in developing and emerging countries, received only 15% of global investments in 2020.
(Anadolu Agency, February 22, 2023)
