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AfrElec INVESTMENT AfrElec

IRENA highlights continued

shortfall in green investment

GLOBAL GLOBAL renewable energy investment much more effort is urgently needed to put us
increased between 2013 and 2018, reaching on a climate compatible pathway and help us
its peak of $351bn in 2017, according to a new recover better with a sustainable, resilient econ-
report by the International Renewable Energy omy. Decision-makers must design systemic
Agency (IRENA) and Climate Policy Initiative approaches to policies that encourage and speed
(CPI). up the flow of investment into renewables, and
The 2020 edition of Global Landscape of away from fossil fuels, and doing so enable eco-
Renewable Energy Finance highlights, however, nomic growth, social resilience and welfare.”
that while a cumulative $1.8 trillion was invested IRENA’s post-COVID agenda showed that
during the five-year period, the amount falls average annual investments of $2 trillion in
short of what is needed to achieve the global cli- renewables and other energy transition-related
mate commitments. technologies in the 2021-2023-recovery phase
Renewable energy investment slightly could create 5.5mn additional jobs in the sector.
declined in 2018, with modest growth through- An additional 19mn energy transition-re-
out 2019. Although this was largely due to the lated jobs would be created by 2030, following
decreasing costs of renewables, the total installed average annual investments of $4.5 trillion up to
capacity continued to grow. 2030.
The current level of investment is still insuffi- The majority of these investments could
cient, however, to keep the rise in global temper- come from private sources, if government funds
atures within the 1.5°C objective by mid-century. are used strategically to nudge investment deci-
To achieve this climate goal, investment in sions and financing in the right direction.
diverse renewables technologies must almost The capital is available, with a push from the
triple annually to $800bn by 2050. governments to mobilise it. Public funds are able
Ambitious commitments from governments to leverage private investments by a factor of 3 to
are needed, backed by supporting measures such 4 if used strategically to steer investments toward
as moving subsidies away from fossil fuels. clean energy solutions and away from fossil fuels.
To that end, policies that enable the integra- Greater participation of institutional inves-
tion of new renewable capacity additions into tors – which hold about $87 trillion in assets –
the energy systems are needed, leading to their will help to achieve the scale of global investment
decarbonisation and bringing wide socio-eco- needed.
nomic benefits. “There is a very clear need for a rapid increase
“The investment trend in renewable energy of investment in renewable energy coupled with
before [coronavirus] COVID-19 was a positive a significant reduction and redirection of invest-
one,” said Francesco La Camera, IRENA’s direc- ment away from fossil fuel energy,” said Dr Bar-
tor-general. “But COVID-19 has shown us that bara Buchner, CPI’s global managing director.™

P6 www. NEWSBASE .com Week 46 19•November•2020