Finance, Solar, Wind - January 19, 2021
Energy transition investment reached $500 billion in 2020
On Jan. 19 BloombergNEF (BNEF) announced a new broad measure of energy transition investment showing global record-breaking 2020 commitments to decarbonization totaling $501.3 billion. This beats the previous year by 9% despite the economic disruption caused by the Covid-19 pandemic.
“The coronavirus pandemic has held back progress on some projects, but overall investment in wind and solar has been robust and electric vehicle sales jumped more than expected,” Jon Moore, chief executive of BNEF, said in a statement. “Policy ambition is clearly rising as more countries and businesses commit to net-zero targets, and green stimulus programs are starting to make their presence felt. Some 54% of 2016 emissions are now under some form of net-zero commitment, up from 34% at the start of last year. This should drive increasing investment in the coming years.”
BNEF’s analysis also shows that companies, governments, and households invested $303.5 billion in new renewable energy capacity in 2020, up 2% on the year, helped by the biggest-ever build-out of solar projects and a $50 billion surge for offshore wind. They also spent $139 billion on electric vehicles and associated charging infrastructure, up a record-breaking 28%.
In addition, domestic installation of energy-efficient heat pumps came to $50.8 billion, up 12%, while investment in stationary energy storage technologies such as batteries was $3.6 billion, level with 2019 despite falling unit prices. Global investment in carbon capture and storage tripled to $3 billion, and that in hydrogen was $1.5 billion, down 20% but the second-highest annual number to date.
Overall, solar capacity investment was up 12% at $148.6 billion and wind (onshore and offshore) down 6% at $142.7 billion. Biomass and waste-to-energy financings were down 3% at $10 billion.