Around $35 trillion investment needed by 2030 for global energy transition suggests IRENA report preview29 March 2023
According to a new report preview from the International Renewable Energy Agency (IRENA), the world will need to invest $35 trillion in renewable energy infrastructure and technology – including hydropower - by 2030 to achieve a successful energy transition.
The World Energy Transitions Outlook 2023 Preview, which highlights the critical role that renewable energy will play in reducing greenhouse gas emissions and meeting global climate goals, outlines a cost-optimal pathway for achieving a global renewable energy system by 2050. It estimates that an additional 30TW of renewable energy capacity will be needed by 2030 to achieve this goal, including 18TW of solar, 8TW of wind, and 3TW of hydropower. The report also calls for significant investment in energy efficiency measures and electric vehicle charging infrastructure.
“The scale of the challenge is daunting, but the benefits of a successful energy transition are enormous,” said IRENA Director-General Francesco La Camera. “The energy transition offers the opportunity to create new jobs, improve public health, and promote sustainable economic growth.”
The preview highlights the importance of international cooperation and private sector investment in achieving the necessary levels of investment. It calls for supportive policies, financial incentives, and increased public and private sector collaboration to accelerate the transition to renewable energy.
“We must rewrite the way international cooperation works,” commented La Camera. “Achieving the energy transition requires stronger international collaboration, including collective efforts to channel more funds to developing countries. A fundamental shift in the support to developing nations must put more focus on energy access and climate adaptation. Moving forward, multilateral financial institutions need to direct more funds, at better terms, towards energy transition projects and build the physical infrastructure that is needed to sustain the development of a new energy system.”
Despite the significant investment required, the preview also highlights the potential for significant cost savings and economic benefits in the long term. By embracing renewable energy and energy efficiency measures, countries can reduce their reliance on fossil fuels, improve energy security, and create new opportunities for economic growth and job creation.
The preview calls for a comprehensive approach to energy system planning and investment, including the adoption of policies to phase out fossil fuel subsidies and create a level playing field for renewable energy. It also emphasizes the need for investment in research and development to drive innovation and cost reductions in renewable energy technologies.
The full World Energy Transitions Outlook 2023 report will be released later this year.