Clean energy investment to hit record $2 trillion by 2024

Despite financial challenges, especially in emerging economies, Investment in clean energy technologies and infrastructure continues to rise driven by improved supply chains and cost reduction. So much so that this year Total global energy spending will exceed $2 trilliona historic figure according to the International Energy Agency (IEA). It will be used to promote renewable energy, electric vehicles, nuclear energy, electricity grids, storage, low-emission fuels, energy efficiency improvements and heat pumps.

This new record also means, double the capital allocated to fossil fuels, which marks an important change in the global panorama and reflects strong economic and political support.

A big investment, but an uneven distribution

This energy transition, despite efforts, is not without challenges. Fatih Birol, executive director of the IEA, noted that it is necessary ensure that these investments reach those regions that need them most. And despite global growth, this report warns of the significant imbalances that persist. Emerging and developing economies, excluding China, will receive only 15% of global investment in clean energy, which is equivalent to about $300 billion, an insufficient figure to meet the growing demand in these areas.

China leads investment in clean energy, with an estimated $675 billion in 2024. It is followed by Europe and USAwith $370 billion and $315 billion respectively. These three economies account for more than two-thirds of global investment.

Growth in solar energy and power grids

The fall in solar module prices has encouraged new investments, so the photovoltaic energy will continue to be the main driver of the energy transformation with an investment of around 500 billion dollars this year.

The IEA report also notes a significant increase in investment in electricity networkswhich will reach $400 billion after years of stagnation. This increase is crucial to overcome one of the biggest obstacles to the expansion of renewable energy: the limited capacity of transmission and distribution infrastructure.

And what about fossil fuels?

Although investment in fossil fuels is growing at a slower pace, it will reach $570 billion in 2024, 7% more than the previous year. The main responsible for this growth are the national oil companies in the Middle East and Asia, which, however, only allocate 4% of its total expenditure on this itemindicating a slow transition towards more sustainable energy sources.