Clean energy investments have taken off and are leaving fossil fuels behind

In fact, some predictions expect investing will into low-CO2 power be nearly twice that in fossil fuel

Worldwide spending on clean energy infrastructure and tech is currently aligned to reach $2 trillion by the close of this year, even as new projects face challenges due to higher financing costs.

Investments are particularly high in emerging and developing economies

Though financing has been facing pressures, worldwide clean energy investments are expected to be nearly twice what will be invested into fossil fuels this year, bolstered by reduced green tech costs and supply chain improvements, according to a newly released report from the International Energy Agency (IEA). Worldwide, total investments into all forms of energy are expected to be greater than $3 trillion this year, which will be a record high.  Of that, about $2 trillion will be directed toward low- and zero-carbon technologies.  Among those cleaner forms of power include renewables, nuclear power, electric vehicles, low-emissions fuels, heat pumps, efficiency improvements, and clean energy grids and storage.  These were identified in the World Energy Investment annual report from the IEA. The rest of the overall investment is directed toward oil, gas and coal.  Last year represented the first year in which investments into renewable power and grids surpassed those in fossil fuels.  Clearly, the trend has continued with a vengeance.

Not all is idyllic in clean energy investing

As promising as this all seems – and, to a great degree, is – the report has also left an important cautioning message behind as well.  This has to do with the substantial shortfalls and imbalances that continue to occur in clean energy investing in many parts of the world. It placed the spotlight on the small degree of green power spending in developing and emerging economies (aside from China), which is led by India and Brazil and that is slated to be greater than $300 billion this year for the first time. The report cautioned that this is substantially lower than the rising demand within those same countries. As a result, issues with capital are slowing new project development in those regions.

Interest in green power continues to rise

“Clean energy investment is setting new records even in challenging economic conditions, highlighting the momentum behind the new global energy economy. For every dollar going to fossil fuels today, almost two dollars are invested in clean energy,” said Fatih Birol, the executive director of the IEA.”