Page 7 - AsiaElec Week 03 2023

AsiaElec COMMENTARY AsiaElec

The world is entering a

new age of clean energy

technology manufacturing

GLOBAL The energy world is at the “dawn of a new indus- number of countries. For example, the Demo-
trial age” – the age of clean energy technology cratic Republic of Congo produces more than
manufacturing, says a new report from the Inter- 70% of the world’s cobalt, and just three coun-
national Energy Agency (IEA). Industries that tries – Australia, Chile and China – account for
were in their infancy in the early 2000s – such as more than 90% of global lithium production.
solar PV and wind -- have mushroomed into vast The world is already seeing the risks of tight
manufacturing operations. supply chains, which have pushed up clean
This is creating major new markets and mil- energy technology prices in recent years, mak-
lions of jobs but also raising new risks, and much ing countries’ clean energy transitions more
depends upon how countries across the globe difficult and costly. Increasing prices for cobalt,
devise industrial strategies to secure their place lithium and nickel led to the first ever rise in EV
in the new global energy economy. battery prices, which rose by nearly 10% globally
Every country has its strength and weak- in 2022. The cost of wind turbines outside China
nesses in the energy transition, and no country has also been rising after years of declines, and
can go it alone, concludes the report. Addi- similar trends can be seen in solar PV.
tionally, the current energy crisis is a pivotal “The IEA highlighted almost two years ago
moment, helping drive the wave of investment. that a new global energy economy was emerg-
The report, Energy Technology Perspectives ing rapidly,” said IEA Executive Director Fatih
2023, provides a comprehensive analysis of Birol. “Today, it has become a central pillar of
global manufacturing of clean energy technolo- economic strategy and every country needs to
gies today – such as solar panels, wind turbines, identify how it can benefit from the opportuni-
EV batteries, electrolysers for hydrogen and heat ties and navigate the challenges.
pumps – and their supply chains around the According to Birol, if everything announced
world. It maps out how they are likely to evolve as of today gets built, the investment flowing
as the clean energy transition advances. into manufacturing clean energy technologies
The analysis shows the global market for key would provide two-thirds of what is needed in
mass-manufactured clean energy technologies a pathway to net zero emissions. “The current
will be worth around $650 bn a year by 2030 – momentum is moving us closer to meeting our
more than three times today’s level – if countries international energy and climate goals – and
worldwide fully implement their announced there is almost certainly more to come,” he said.
energy and climate pledges. “At the same time, the world would benefit
The related clean energy manufacturing jobs from more diversified clean technology supply
would more than double from 6 million today to chains,” Dr Birol cautioned. “As we have seen
nearly 14 million by 2030. Further rapid indus- with Europe’s reliance on Russian gas, when you
trial and job growth is expected in the following depend too much on one company, one country
decades. or one trade route – you risk paying a heavy price
Yet there are risks in the form of high geo- if there is disruption.”
graphic concentrations of resource mining and The report notes that major economies are
processing as well as technology manufacturing. acting to combine their climate, energy security
For technologies like solar panels, wind, EV bat- and industrial policies into broader strategies for
teries, electrolysers and heat pumps, the three their economies. The Inflation Reduction Act in
largest producer countries account for at least the US States is a clear example of this, but there is
70% of manufacturing capacity for each tech- also the Fit for 55 package and REPowerEU plan
nology – with China dominant in all of them, in the European Union, Japan’s Green Transfor-
the report cautions. mation programme, and the Production Linked
Meanwhile, a great deal of the mining for Incentive scheme in India that encourages man-
critical minerals is concentrated in a small ufacturing of solar PV and batteries. China is

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