A new IRENA report notes clear disparities between investments in developed and developing countries, calling for a substantial increase in financial flows from the north to the south of the world
Global Landscape of Renewable Energy Finance 2023 published
Investments in renewable energy continue to grow. Last year, transition technologies, including energy efficiency, reached a record $1.3 trillion globally. An expense that can also make pale the excellent result of 2021. But records are not enough and why IRENA, the international renewable energy agency, explains today. In the report Global Landscape of Renewable Energy Finance 2023, written together with the Climate Policy Initiative (CPI) and presented this morning in Madrid, the organization focuses on two of the biggest problems of green financial activity: is still too small and does not have a fair distribution.
Although investment in renewable energy reached $500 billion in 2022, this still represents less than 40% of the average investment needed each year between 2021 and 2030, according to the temperature containment scenario by 1,5 Then increase C. Nor is the rate sufficient to achieve the UN’s sustainable development goals by the end of the decade.
Comparing the funding of renewable energy between countries and regions, the document identifies obvious disparities that have increased significantly in the last six years. About 70% of the world’s population, mainly living in developing and emerging countries, received only 15% of global investment in 2020. In 2021, per capita investment in Europe was 127 times higher than in sub-Saharan Africa.
Investments in renewable energy, some data
The document also reveals that, spending has focused on specific technologies and uses. In 2020, photovoltaics alone attracted 43% of total investment in renewables, followed by onshore and offshore wind respectively at 35% and 12%. Based on preliminary data, this concentration appears to have continued until 2022.
Another noteworthy fact: in 2020 the private sector continued to make the lion’s share in investments in renewable energy, committing 240 billion dollars (or 69% of the total global), up 7% compared to 2019. Public sector funding provided $108 billion in the same year (31% of the total), 2% less than in 2017-2019
“The path to zero net emissions – said Barbara Buchner, global managing director of CPI – can only happen with a fair and equitable energy transition […] It is absolutely necessary to scale more to avoid dangerous climate change, particularly in developing countries“.
“For the energy transition to improve lives and livelihoods – added IRENA Director-General Francesco La Camera – governments and development partners must ensure a fairer flow of funding, recognising different contexts and different needs”. The report, underlines La Camera, highlights the need to direct public funds to regions and countries with a great potential for renewable energy not exploited, but that have difficulty in attracting investment.
