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BNEF: Global energy transition spending topped $500 billion for first time in 2020 despite pandemic

January 20, 2021

S&P Global Market Intelligence ($):

Governments, companies and individual consumers spent a record $500 billion transitioning to lower-carbon energy in 2020 despite economic disruptions caused by the coronavirus pandemic, research provider BloombergNEF said in a new report Jan. 19.

Investment in renewable power, energy storage, electric vehicles, hydrogen and related sectors rose 9% year over year to $501.3 billion as a surge of spending in Europe helped to offset declines in the U.S. and China, BNEF said. Well over half of total energy-transition investments — $303.5 billion — went to renewable energy projects.

“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,” BNEF CEO Jon Moore said in a statement accompanying the report. “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.”

Within the renewable energy sector, solar investments rose 12% in 2020 to $148.6 billion, or about half of overall spending in the area, while wind investment dipped 6% to $142.7 billion, BNEF said. In electric transport, $139 billion went toward new vehicles and charging infrastructure, an increase of 28%. Energy storage projects drew $3.6 billion, in line with a year earlier. And green hydrogen investments fell 20% to $1.5 billion, mainly due to lower sales of fuel-cell buses.

“Our figures show that the world has reached half a trillion dollars a year in its investment to decarbonize the energy system. Clean power generation and electric transport are seeing heavy inflows, but need to see further increases in spending as costs fall,” said Albert Cheung, head of analysis at BNEF, in a statement. “We need to be talking about trillions per year if we are to meet climate goals.”

[Michael Copley]

More ($): Energy-transition spending jumped 9% to record $500B amid COVID-19 upheaval

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