The IEA predicts that global energy investment will reach a record $3,3 trillion by 2025.
The International Energy Agency (IEA), said Thursday, that despite geopolitical tensions and economic uncertainty, a surge in clean energy expenditure is expected to lead to a record $2.89 trillion in global energy investments in 2025.
The IEA's annual World Energy Investment Report stated that clean energy technologies such as renewables, nuclear and energy storage are expected to attract $2.2 trillion, which is twice what was predicted for fossil fuels.
The IEA's Executive Director Fatih Birol stated that "the fast-changing economic and trade situation means that some investors adopt a wait-and see approach for new energy project approvals. However, in most areas, we have not yet seen significant implications for current projects."
The report stated that solar power will be the largest beneficiary of the investment, which is forecast to reach $450 Billion in 2025. Battery storage spending is also expected to increase to $66 Billion.
Batteries can be used to reduce the intermittent nature of renewable energy sources by storing electricity during times of high supply and discharging it during times of peak demand. However, investments in this technology are lagging behind those for solar and wind.
Investment in oil and gas, on the other hand, is expected to decrease. Upstream oil investment will fall by 6% by 2025 due to lower oil prices, expectations of demand and the first decline since the Covid Crisis in 2020.
The IEA warned that the $400 billion invested in grids per year was less than what is spent on electricity generation and electrification. This could be a threat to security of supply.
By the early 2030s, grid investments must be near equal to generation expenditures in order to maintain security of electricity. However, this is not happening due to red tape or tight supply chains.
The global spending patterns are still very uneven, with China dominating clean energy investments at nearly one-third. (1 euro = $1.1414). (Reporting and editing by Ed Osmond, Forrest Crellin)
(source: Reuters)
