Global energy investment is “far out of step” with what's needed to meet the world’s climate objectives, claimed the International Energy Agency (IEA) in a bleak assessment that low-carbon spending has stalled, with only oil, gas and even coal showing growth last year.
The IEA’s annual study, World Energy Investment 2019, flags up what the organisation called “a growing mismatch between current trends and the paths to meeting the Paris Agreement and other sustainable development goals”, as it registered a slight fall in spending on renewables for power, transport and heat.
The overall global spend on low-carbon energy has “stagnated” at about $620bn over the last two years, the IEA estimates, whether looked at from the supply or demand side.
Low-carbon investment is stuck at about 35% of the global energy total – and the amount going into power grids has actually fallen.
The IEA said that although when the effect of cost falls is factored in, renewable investments have increased by 55% by 2010, it is nowhere near enough.
“To meet long-term sustainability goals, even with changing costs, low-carbon investment would need to grow two-and-a-half times by 2030, with its share rising to 65%,” said the body.
And it concluded that “there are few signs of the substantial reallocation of capital towards energy efficiency and cleaner supply sources that is needed…”.
Total energy investment stabilised at about $1.85trn in 2018 after three years of decline, the IEA study found. However, the sources of growth that arrested the fall were extra investment in upstream oil and gas and the coal supply sector – hardly promising signs of the green revolution.
IEA executive director Fatih Birol said: “Energy investments now face unprecedented uncertainties, with shifts in markets, policies and technologies. But the bottom line is that the world is not investing enough in traditional elements of supply to maintain today’s consumption patterns, nor is it investing enough in cleaner energy technologies to change course.
Whichever way you look, we are storing up risks for the future.
“Whichever way you look, we are storing up risks for the future.”
The downbeat investment outlook comes hard on the heels of the IEA's finding that 2018 was the first time since 2001 that growth in renewable power capacity failed to increase year on year, with about 180GW added world-wide from solar PV, wind, hydro, bioenergy and other renewable sources.