Released June 04, 2021 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Global investment in energy is expected to rise about 10% this year to about $1.9 trillion, bringing it back to pre-pandemic levels, but worldwide energy use and carbon dioxide (CO2) levels also are projected to rise, making it harder to achieve the goals of the Paris Agreement to limit global temperature increases, according to a new report from the International Energy Agency (IEA) (Paris, France).
Worldwide spending on clean energy transitions needs to accelerate "much more rapidly" to meet climate goals, said the report, World Energy Investment 2021.
"The rebound in energy investment is a welcome sign, and I'm encouraged to see more of it flowing towards renewables," IEA Executive Director Fatih Birol said in releasing the report June 2. "But much greater resources have to be mobilized and directed to clean energy technologies to put the world on track to reach net-zero emissions by 2050. Based on our new Net Zero Roadmap, clean energy investment will need to triple by 2030."
Click on the image at right to see a graphic on overall global energy investment from 2017 through an estimate for 2021.
Although plans to build new coal-fired electric generation are down some 80% from five years ago, the fact that new coal power plants are being planned, mostly in Asia, shows that coal is "down but not out," the IEA report said. Indeed, about $100 billion will be spent to develop new coal mines around the world this year, about the same level as 2020 and only slightly less than what was spent in 2019.
Oil and gas exploration & production (E&P) is expected to rise to about $350 billion this year, up from 2020 but well below 2019 spending levels, the IEA projected. This year, spending on renewable energy is anticipated to slightly exceed outlays for oil and gas E&P, it added. Anticipated outlays for fossil-fueled power generation this year are expected to be about triple the spending on nuclear energy, it added.
Click on the image at right to see the IEA's sector-by-sector breakdown of global energy spending, for 2019, 2020 and 2021 (estimated).
This year, the IEA report said, spending on the Power sector, driven by investments in renewable energy, is expected to be roughly equal to the combined spending for the 2016-2020 period. But investment in the Power sector needs to further accelerate, perhaps dramatically so, under three scenarios laid out by the IEA in prior reports. To meet the goals of the agency's net-zero emissions by 2050 scenario, worldwide annual investment in the Power sector would need to nearly triple, to about $2.3 trillion per year over the 2025-2030 period. Spending on renewable energy would have to reach nearly $1.4 trillion per year over the 2025-2030 period, nearly three times the projected outlay of about $400 billion this year.
Click on the image at right to see recent Power industry spending, and projected spending levels needed to achieve net-zero emissions by 2050.
Upstream spending by the major oil and gas companies this year is expected to rise about 10% from last year's capital spending, but well down from 2019 levels, projected World Energy Investment 2021. However, E&P spending this year by Chinese national oil companies (NOCs), Middle Eastern NOCs and Russian companies is expected to grow, as they try to position themselves to capture market share from the majors.
Click on the image at right to see upstream spending for various categories of oil companies from 2015-2020, with an estimate for 2021.
The report referenced Qatar's decision to move ahead with the world's largest liquefied natural gas (LNG) expansion, and to include carbon capture technologies in this investment, as a "strong signal of its intent to maintain a leadership position in LNG."
"As set out in detail in our recent Roadmap to Net Zero by 2050 (report), governments need to go beyond making pledges to cut emissions and take concrete steps to accelerate investments in market-ready clean energy solutions and promote innovation in early-stage technologies," said Birol. Increased government spending, and what the IEA euphemistically referred to as government "policy signals," are needed to drive investment decision that need to be made this decade if the world is to avert catastrophic increases in carbon dioxide emissions that would drive up global temperatures over the next three decades.
"The momentum from net-zero pledges and sustainable finance is yet to translate into large increases in actual spending on clean energy projects," the report said. "Clean energy investment is on a moderate upswing, but remains far short of what will be required to avoid severe impacts from climate change."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
Worldwide spending on clean energy transitions needs to accelerate "much more rapidly" to meet climate goals, said the report, World Energy Investment 2021.
"The rebound in energy investment is a welcome sign, and I'm encouraged to see more of it flowing towards renewables," IEA Executive Director Fatih Birol said in releasing the report June 2. "But much greater resources have to be mobilized and directed to clean energy technologies to put the world on track to reach net-zero emissions by 2050. Based on our new Net Zero Roadmap, clean energy investment will need to triple by 2030."
Although plans to build new coal-fired electric generation are down some 80% from five years ago, the fact that new coal power plants are being planned, mostly in Asia, shows that coal is "down but not out," the IEA report said. Indeed, about $100 billion will be spent to develop new coal mines around the world this year, about the same level as 2020 and only slightly less than what was spent in 2019.
Oil and gas exploration & production (E&P) is expected to rise to about $350 billion this year, up from 2020 but well below 2019 spending levels, the IEA projected. This year, spending on renewable energy is anticipated to slightly exceed outlays for oil and gas E&P, it added. Anticipated outlays for fossil-fueled power generation this year are expected to be about triple the spending on nuclear energy, it added.
This year, the IEA report said, spending on the Power sector, driven by investments in renewable energy, is expected to be roughly equal to the combined spending for the 2016-2020 period. But investment in the Power sector needs to further accelerate, perhaps dramatically so, under three scenarios laid out by the IEA in prior reports. To meet the goals of the agency's net-zero emissions by 2050 scenario, worldwide annual investment in the Power sector would need to nearly triple, to about $2.3 trillion per year over the 2025-2030 period. Spending on renewable energy would have to reach nearly $1.4 trillion per year over the 2025-2030 period, nearly three times the projected outlay of about $400 billion this year.
Upstream spending by the major oil and gas companies this year is expected to rise about 10% from last year's capital spending, but well down from 2019 levels, projected World Energy Investment 2021. However, E&P spending this year by Chinese national oil companies (NOCs), Middle Eastern NOCs and Russian companies is expected to grow, as they try to position themselves to capture market share from the majors.
The report referenced Qatar's decision to move ahead with the world's largest liquefied natural gas (LNG) expansion, and to include carbon capture technologies in this investment, as a "strong signal of its intent to maintain a leadership position in LNG."
"As set out in detail in our recent Roadmap to Net Zero by 2050 (report), governments need to go beyond making pledges to cut emissions and take concrete steps to accelerate investments in market-ready clean energy solutions and promote innovation in early-stage technologies," said Birol. Increased government spending, and what the IEA euphemistically referred to as government "policy signals," are needed to drive investment decision that need to be made this decade if the world is to avert catastrophic increases in carbon dioxide emissions that would drive up global temperatures over the next three decades.
"The momentum from net-zero pledges and sustainable finance is yet to translate into large increases in actual spending on clean energy projects," the report said. "Clean energy investment is on a moderate upswing, but remains far short of what will be required to avoid severe impacts from climate change."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
