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Climate ChangeInternational

Global spend on renewable energy in 2023 to outstrip fossil fuels

By June 8, 2023No Comments2 min read

2Zero50, as our company name implies, is passionate about achieving net zero CO2 emissions by 2050. The pathway for achieving this is mapped out by the International Energy Agency’s (IEA) Net Zero Emissions by 2050 Scenario (NZE Scenario) and last month the IEA released its World Energy Investment 2023 report.

The report reveals fundamental changes in energy investments globally, with more than USD 1.7 trillion of the estimated USD 2.8 trillion to be invested in energy during 2023, going to clean energy. This means that for every USD 1 spent on fossil fuels, USD 1.7 is now spent on clean energy. Five years ago this ratio was 1:1. Clean energy includes renewable power, nuclear, grids, storage, low-emission fuels, efficiency improvements and end-use renewables and electrification.

The biggest spend is on solar, with more than USD 1 billion per day expected to go into solar investments in 2023. For the first time, this is more than what will be spent on upstream oil – which includes oil discovery, extraction, and production.

Clean energy prices have also been coming down, with one of the most notable being the price of batteries for Electric Vehicles (EVs).

Closer to home, residents in the City of Cape Town have embraced solar, with 21% of all solar PV applications ever recorded, having been received in the first four months of 2023.

2Zero50 receives many requests for solar plants from farmers. The agricultural sector is ideally suited to a hybrid solar solution (typically a mix of solar, batteries, generator and Eskom), as they usually have land available for the panels and can tailor their energy consuming operations to day time, when the cheapest source of energy is at its peak.

But how are we progressing towards the goal of net zero in 2050? According to the IEA report, the current rate of investment in solar will match the investment required. Encouraging, but the same is needed from all clean sources of energy. Several challenges remain, with energy distribution (transmission) lagging across the world and total investment remaining primarily in China, USA and Europe. Particularly in emerging and developing economies, support such as improved access to finance, is needed to scale up investment.

By Chris Welham  •  Updated: 08/06/2023

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