Low-carbon energy investment lagging in developed economies: study
NEW YORK: Investments in the low-carbon technology needed to reduce planet-warming emissions in emerging markets sank in the past four years even as financing jumped in developed economies, according to a study released on Tuesday.
Building more clean power generation sites in emerging economies to help wean them off fossil fuels will be high on the list of priorities for world leaders gathering in Egypt for a United Nations conference from Nov. 6.
These markets account for nearly half of the world’s greenhouse gas emissions, but less money is flowing into their low-carbon initiatives since the COVID-19 pandemic strained global supply chains and shrank project pipelines, BloombergNEF analysts said in the study.
Equity and debt financing for wind and solar plants, carbon capture and storage, electrified heat and transport, energy storage and hydrogen and nuclear globally reached a record high of $785 billion in 2021, almost a quarter above the previous year, BloombergNEF found.
But within that total, emerging economies saw investment slump 9% from a 2018 peak to just under $67 billion in 2021, while richer countries clocked a 53% increase.
Many global companies and governments have espoused a target to cut greenhouse gas emissions to net-zero – no more than can be absorbed back into natural sinks like forests or other technology – by 2050. That would require annual clean energy investment to reach $4.2 trillion in 2030, according to the International Energy Agency.
One of the curbs on investment in renewable energy in emerging markets in 2021 was a dearth of auctions for power delivery contracts, which have historically given vital incentives and security for developers in those countries. The lack of auctions could mean utility-scale clean energy projects are built slowly over the next few years, BloombergNEF said.
Source: reuters
