According to the International Energy Agency (IEA), investment in clean energy is projected to surpass spending on fossil fuels in 2023. The IEA’s World Energy Investment report states that annual investments in renewable energy have increased by nearly a quarter since 2021, while fossil fuel investments have risen by 15%.
It is worth noting that around 90% of clean energy investments originate from advanced economies and China. This highlights the significant disparity between rich and poor nations, as fossil fuel investments still remain double the amount required to achieve net-zero emissions by the middle of the century.
For every dollar invested in fossil fuels, approximately 1.7 dollars are now being allocated to clean energy. This marks a notable shift compared to five years ago when the ratio was one-to-one, as mentioned by Fatih Birol, the Executive Director of the IEA.
The global energy sector is expected to witness investments totaling around $2.8 trillion in 2023. Of this amount, more than $1.7 trillion will be directed towards renewables, nuclear power, electric vehicles, and efficiency enhancements. The remaining $1 trillion is projected to be allocated to oil, gas, and coal, with demand for coal reaching an all-time high, reaching six times the level needed in 2030 to achieve net-zero emissions by 2050.
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