Page 5 - AfrElec Week 05 2022
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AfrElec COMMENTARY AfrElec
energy transition investment in 2021 is an has the best chance of getting on track for such
encouraging sign that investors, governments investment levels; other sectors look less likely
and businesses are more committed than ever to get on track.
to the low-carbon transition, and see it as part Matthias Kimmel, head of energy economics
of the solution for the current turmoil in energy at BNEF, said: “The world is rapidly running out
markets.” of carbon budget to meet the goals of the Paris
Record amounts were invested in all three Agreement. The energy transition is well under-
regions covered in the report: Asia-Pacific way, and moving faster than ever, but govern-
(APAC), Europe, Middle East & Africa (EMEA), ments will need to mobilise much more finance
and the Americas (AMER). APAC was both the in the next few years if we are to get on track for
largest region for investment at $368bn – nearly net zero by 2050.”
half the global total – and the region with the The report also finds that climate-tech corpo-
highest growth at 38% in 2021. Energy transi- rate finance reached $165bn in 2021. This cate-
tion investment in EMEA grew by 16% in 2021, gory of investment, not included in the $755bn,
reaching $236bn, while the Americas – which describes new equity financing raised by compa-
are lagging – saw investment grow by 21% to nies in the climate-tech space, either from public
$150bn. markets or private investors.
BNEF’s 2021 New Energy Outlook (NEO) This capital will be used in the coming years
has previously mapped out three alternative sce- to scale up these companies’ operations and fur-
narios – dubbed green, red and grey – for reach- ther develop their technologies. Two-thirds of
ing global net zero by 2050, in line with 1.75 this funding came from public markets, includ-
degrees of global warming, a more lx goal than ing SPAC reverse mergers, and the vast majority
the 1.5 degrees of the Paris Agreement. went to companies focused on the energy and
Investment needs to increase dramatically to transport sectors.
reach the goal of 1.75 degrees. “There has never been more capital available
The new report, when compared with NEO, to companies tackling the hardest aspects of the
shows that investment levels need to triple climate challenge,” said Claire Curry, head of
approximately, such that they average $2.1 tril- technology and innovation at BNEF.
lion per year between 2022-2025, in order to get “It is true that we have solutions ready to
on track for any of those three scenarios. deploy today, but there is still the need for contin-
They then need to double again, to an average ued innovation. All forms of corporate finance
of $4.2 trillion between 2026 and 2030. At cur- will play an important role in helping develop
rent growth rates, the electrified transport sector and scale climate-tech in the coming decade.”
Week 05 03•February•2022 www. NEWSBASE .com P5
