Calay News
According to the International Energy Agency (IEA), investments in low-carbon energy, especially solar, could surpass investment in oil extraction for the first time by 2023. The IEA forecasts an increase in investments in carbon-neutral technologies, reaching US$1.7 trillion this year compared to US$1 trillion for oil, gas, and coal. Investments in carbon-neutral energy, which includes renewables, nuclear, heat pumps, and electric car batteries, are expected to increase by 24% over the 2021–2023 period.
The IEA’s annual report highlights that clean energy is advancing faster than expected, with an investment ratio of 1.7 to 1 in favor of clean energy compared to fossil fuels. Solar energy is the most prominent, with daily investments exceeding US$1 billion and a projected total of US$380 billion by 2023, surpassing the US$370 billion allocated to oil exploration and extraction.
Investment in electricity generation is 90% dominated by low-carbon technologies. This momentum has been strengthened by the impact of the war in Ukraine on fossil energy prices and supportive measures in the European Union, China, and the United States.
However, the IEA warns of imbalances in this process, as investments in clean energy are mainly concentrated in China and countries with advanced economies. There is incipient progress in India, Brazil, and the Middle East, but in other regions, clean energy investments are lagging behind. The IEA urges the international community to take action to address this situation.
While investment in clean energy is on the rise, the IEA notes that spending on oil and gas exploration and exploitation is also increasing, moving the world further away from carbon neutrality by mid-century. Demand for coal will reach record levels by 2022, and investments in this sector will exceed by six times those needed to achieve emissions neutrality by 2030.
Major oil and gas groups spent less than 5% of their production expenditures on low-carbon energy and carbon capture and storage last year, underscoring the need for a shift in investment and focus to clean energy.
