Spending on Global Energy Transition Hits Record $500 Billion
Stu Turley
The world spent a record $501.3 billion in 2020 on renewable power, electric vehicles and other technologies to cut the global energy system’s dependence on fossil fuels.
The investments in the transition to a low-carbon economy marked a 9% increase over 2019 and came despite disruptions from the Covid-19 pandemic, according to a report out Tuesday from BloombergNEF.
The growth wasn’t spread evenly across the globe. Investment in renewable power capacity, which accounted for the the biggest chunk of spending tallied by BNEF, soared 52% in Europe compared to last year. But it fell 20% in the U.S. and 12% in China.
The record investment comes as pressure mounts to cut greenhouse-gas emissions and avoid the most dire effects of climate change. But even the massive increase in spending on wind and solar farms, energy storage and EVs won’t be enough to meet the Paris Agreement’s goal to limit global warming to below 2 degrees Celsius.
“It’s very encouraging that investment is taking place at a high level, but it’s well short of what would be required to put the world on a path of 2 degrees of global warming,” Angus McCrone, chief editor of BNEF, said in an interview.