IEA: Global clean energy investment ‘significantly’ outpacing fossil fuel spending

By Michael Holder

Global investment in clean energy technologies — from renewables and electric vehicles (EVs) to nuclear power plants and heat pumps — is “significantly” outpacing spending on fossil fuels, with the energy crisis having accelerated momentum around the global green energy transition, according to the latest update from the International Energy Agency (IEA).

The influential agency predicted Thursday that investment in the world’s energy system is set to reach $2.8 trillion in 2023, of which more than $1.7 trillion would go toward clean energy technologies, including renewables, EVs, nuclear, power grids, energy storage, low carbon fuels, energy efficiency projects, and heat pumps.

The remainder — just over $1 trillion — is still set to be invested in coal, oil and gas projects, but the IEA stressed that clean energy technologies were moving “faster than many people realize” and that the momentum had shifted significantly in favor of clean tech in the wake of the global energy crisis.

A 24 percent increase in clean energy investment is expected between 2021 and 2023, driven largely by spending on renewables and EVs, compared to a 15 percent rise in fossil fuel investment, the IEA’s latest annual world energy investment report reveals.

The IEA highlighted solar in particular as the “shining example” of the scale and scope of the clean energy transition, with investment in the technology — projected to be around $380 billion — set to overtake the amount of money being channelled into oil production for the first time this year.

Led by solar, low carbon electricity technologies are expected to account for almost 90 percent of global investment in new power generation, according to the report.

Similarly, battery storage investment more than doubled worldwide last year, and is set to double again in 2023, while investment in critical mineral mining grew by 30 percent last year in response to growing demand from clean technologies, it said.

In addition, the report reveals that global heat pump sales enjoyed double-digit growth for the second year running last year, while EV sales reached around $400 billon after growing 55 percent in 2022.

“Clean energy is moving fast — faster than many people realize,” said IEA executive director Fatih Birol. “This is clear in the investment trends, where clean technologies are pulling away from fossil fuels. For every dollar invested in fossil fuels, about 1.7 dollars are now going into clean energy. Five years ago, this ratio was 1-to-1.”