31 Jan Energy transition investment equalled $755 billion in 2021, BloombergNEF report finds
A recent report by BloombergNEF has found that global investment in the energy transition totalled a record US$755 billion in 2021, off the back of rising climate ambitions and policy action from countries around the world.
Investments rose in almost every sector covered in the report, including: renewable energy, energy storage, electrified transport, electrified heat, nuclear, hydrogen and sustainable materials. Only carbon capture and storage recorded declining investment in the year.
In the largest single sector – renewable energy – investment increased by 6.5% on 2020 to achieve a new record of $366 million, while electrified transport (including spending on EVs and associated infrastructure) was the second largest sector with $273 billion invested in 2021.
“With electric vehicle sales surging, this sector grew at a breakneck rate of 77% in 2021 and could overtake renewable energy in dollar terms in 2022,” the report said.
The new data reveals that nuclear, energy storage, electrified transport and electrified heat accounted for the vast majority of investment at $731 billion. The remaining $24 billion is comprised of hydrogen, carbon capture and sustainable materials.
Albert Cheung, head of analysis at BloombergNEF, wrote in the report: “The global commodities crunch has created new challenges for the clean energy sector, rising input costs for key technologies like solar modules, wind turbines and battery packs.
“Against this backdrop, a 27% increase in energy transition investment in 2021 is an encouraging sign that investors, governments and businesses are more committed than ever to the low-carbon transition, and see it as part of the solution for the current turmoil in energy markets.”