While global investments in renewable energy have risen steadily in recent years, they remain far below the levels required to put the world on course for a climate-safe future.
This report, co-developed by the International Renewable Energy Agency (IRENA) and Climate Policy initiative, provides actionable recommendations for policy makers and other stakeholders to scale up investment and mobilise capital in the sector.
From about USD 300 billion globally in recent years, annual investments in renewables must triple to USD 800 billion by 2050 to fulfil key global decarbonisation and climate goals.
Renewable energy has proven resilient and flexible amid the COVID-19 crisis, as well as providing a valuable opportunity to align economic recovery with sustainable development and climate goals. By placing renewables at the centre of stimulus plans, governments can attract investments, increase investor confidence, strengthen national energy strategies and fulfil climate pledges under the Paris Agreement.
Among other findings:
- Regions dominated by developing and emerging economies remained consistently under-represented, attracting only 15% of global investments in renewables in 2013-2018.
- Public financing resources, although limited, are crucial to lower risks, overcome initial barriers, attract private investors and bring new markets to maturity.
- Annual financial commitments to off-grid renewables reached USD 460 million in 2019, up from just USD 250 000 known worldwide in 2007. However, off-grid renewables still represent only 1% of the overall finance for projects to expand energy access worldwide.
- Sub-Saharan African countries attracted 65% of the world’s off-grid renewable energy investments over 2007-2019, with investments concentrated especially in East Africa.
- Solar photovoltaic (PV) and onshore wind power consolidated their dominance of the finance landscape in 2013-2018, attracting, respectively, 46% and 29% of global investments in renewables.
Report by Irena