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Renewable energy investment in 2018 hit USD 288.9 billion

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Global investment in renewable energy hit USD 288.9 billion in 2018, with the amount spent on new capacity far exceeding the financial backing for new fossil fuel power, according to new figures published today.

These numbers, produced by BloombergNEF (BNEF), are being published today as part of REN21’s Renewables 2019 Global Status Report.

The numbers show that while investment was 11 per cent down over the previous year, 2018 was the ninth successive year in which it exceeded USD 200 billion and the fifth successive year above USD 250 billion. The figure does not include hydropower above 50MW, which saw an additional USD 16 billion invested – also down on 2017, when USD 40 billion was invested.

The dip in investment in 2018 can be partly attributed to falling technology costs in solar photovoltaics, which meant that the required capacity could be secured at a lower cost, and a slowdown in solar power deployment in China.

However, globally, solar was still the largest focus of investment, with USD 139.7 billion in 2018, down 22 per cent. Wind power investment increased two per cent in 2018, to USD 134.1 billion. The other sectors lagged far behind, although investment in biomass and waste-to-energy increased 54 per cent, to USD 8.7 billion.

The figures compare the amount invested in new renewable power capacity, which was USD 272.3 billion  globally in 2018 (excluding large hydro), with that in new coal- and gas-fired generating capacity, which was USD 95 billion.

China leads, Europe and developing countries rally

A geographical breakdown of the USD 288.9 billion figure for total renewable energy investment in 2018 shows that China led investment worldwide for the seventh successive year, at USD 91.2 billion. However, this was down 37 per cent from 2017’s record number, due to a number of factors including a mid-year change in the government’s feed-in tariff policy, which hit investment in solar power.

China also accounted for 32 per cent of the global total investment, followed by Europe at 21 per cent, the United States at 17 per cent, and Asia-Oceania (excluding China and India) at 15 per cent. Smaller shares were seen in India at 5 per cent, the Middle East and Africa at 5 per cent, the Americas (excluding Brazil and the United States) at 3 per cent and Brazil at 1 per cent.

If China is excluded, renewable energy investment in the developing world actually increased 6 per cent to USD 61.6 billion, a record high.

“When overall investment falls, it is easy to think we are moving backwards, but that is not the case,” Angus McCrone, Chief Editor at BloombergNEF, commented: “Renewable energy is getting less expensive and we are seeing a broadening of investment activity in wind and solar to more countries in Asia, Eastern Europe, and the Middle East and Africa.”

Investment in Europe jumped 39 per cent to USD 61.2 billion, the highest level in two years, driven largely by large on- and off-shore wind investments.

In the United States, investment edged up 1 per cent to USD 48.5 billion, the highest level since 2011, also driven by an increase in wind power financing.

Investment in the Asia-Pacific region (excluding China and India) increased 6 per cent to USD 44.2 billion, the highest level in three years, while the Middle East and Africa saw investment leap 57 per cent to a record USD 15.4 billion. However, in the Americas (excluding Brazil and the United States), investment declined 23 per cent (excluding large hydropower) to USD 9.8 billion. 

“It is reassuring to see investment growing in the US,” said Prof. Dr. Nils Stieglitz, President of Frankfurt School of Finance & Management, involved in the report, “Ironically, this renewables investment growth may in part be driven by projects rushing to qualify for the current tax-support scheme, which is due to expire in only a few years as chances for extension are currently quite low.”

A wealth of more detailed information on global investment in the financing of renewables in 2018 will be shared in the Global Trends in Renewable Energy Investment report, to be released in September ahead of the Global Climate Action summit of the UN Secretary-General. That report has been published every year since 2007. this year’s edition is co-funded by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety. It will feature a look back on a decade of renewable energy investment.

UN Environment

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IRENA Puts Renewables Centre-Stage at UN High- Level Meeting

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‘There can be no sustainable development without renewables’ – that was the takeaway from the 17th IRENA Council which concluded recently in Abu Dhabi. It was a message the Agency’s Director-General Francesco La Camera reinforced at every opportunity and a message that will once again take centre-stage during the United Nations High-Level Political Forum (HLPF) on Sustainable Development in New York this and next week.

The UN High-Level Political Forum takes place at the UN Headquarters in New York from 09–18 July 2019. Progress on six of the seventeen Sustainable Development Goals (SDGs) will be reviewed. Renewable energy plays a prominent role in goals being discussed this year, particularly those promoting sustained, inclusive and sustainable economic growth (SDG8); taking urgent action to combat climate change and its impacts (SDG13); and promoting peaceful and inclusive societies for sustainable development (SDG16).

Director-General Francesco La Camera will attend the Forum to engage dignitaries and IRENA members and partners. Mr. La Camera will also participate in a series of high-level discussions on topics including scaling-up climate action through the energy transformation and accelerating the energy transition in small island developing states.

Mr. La Camera will highlight the inter-linkages between the goals under review and access to affordable, reliable and modern energy for all (SDG7), a focus of  the last year’s HLPF. The essential role of renewable energy in powering growth, empowering people, and taking climate action will also be emphasised.

IRENA at HLPF

On 16 July, IRENA’s High-level side event on ‘Scaling up climate action through clean energy transitions: Delivering on the Paris Agreement and the SDGs’ will be co-convened by UN DESA, the European Union, and the Permanent Mission to the UN of the Federal Democratic Republic of Ethiopia. Building on findings and outcomes from reports and meetings, including the 2019 Tracking SDG7 Energy Progress Report and Climate Summit preparatory meeting in Abu Dhabi, outcomes from this discussion will feed into the UN Secretary-General’s Climate Action Summit and the SDG Summit in September 2019.

On 17 July, the High-level Side event on Scaling-Up Energy Transition in Small Island Developing States, will mark the launch of the policy brief on ‘Achieving SDG 7 in Small Island Developing States’ and pave the way for the Mid-term Review of the SAMOA Pathway taking place in September 2019. Organised by Saint Lucia, Samoa, Maldives, UN-OHRLLS and IRENA, the event will take stock of energy transition developments and renewable energy uptake in SIDS and explore the vital elements in making progress in the area of sustainable energy.

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IEA hosts high-level meeting on technologies for a clean energy future

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The discussion at the event was informed by two recent major reports from the IEA about nuclear power and hydrogen. Photo: IEA

The International Energy Agency on 11 July hosted a discussion among leading global energy sector figures about technologies that can help to bring about a clean energy future, including hydrogen and nuclear power.

The main speakers at the event were Dan Brouillette, Deputy US Energy Secretary; Jean-Bernard Lévy, Chairman and CEO of EDF; Hiroshi Oe, Japanese Ambassador to the OECD and Chair of the IEA Governing Board; and Dominique Ristori, Director-General Energy at the European Commission.

The discussion at the IEA’s headquarters in Paris was informed by two recent major reports from the IEA: Nuclear Power in a Clean Energy System and The Future of Hydrogen: Seizing Today’s Opportunities.

At a time of profound change in the global energy sector, countries will require all the tools at their disposal to meet their commitments to tackling emissions and air pollution while maintaining energy security.

“I’d like to thank our speakers for the robust and rewarding conversation,” said Dr Fatih Birol, the IEA’s Executive Director, who hosted the event. “There is no miracle technology that will solve the daunting environmental challenges the world faces. We need continued innovation across a range of technologies, including renewables, energy efficiency, batteries, carbon capture and more. The IEA sees hydrogen and nuclear power as important parts of clean energy transitions in many countries, but they need help from governments to overcome significant obstacles.”

Nuclear power is by far the largest source of low-carbon electricity in both Europe and North America, but many of their plants are aging. Without effective policies to spur new investment, advanced economies could lose as much as two-thirds of their nuclear capacity in the next 20 years, threatening global climate goals and energy security.

Hydrogen, which is currently enjoying unprecedented momentum, can help tackle various critical energy challenges. It offers ways to decarbonise a range of sectors where it is proving difficult to meaningfully reduce emissions, including long-haul transport, chemicals, and iron and steel. Hydrogen’s ability to store and transport energy could enable renewables to make a greater contribution to the global energy system. But it has experienced false starts in the past and still faces big challenges to scale up infrastructure and bring down costs.

The meeting on 11 July to discuss these important energy issues highlights the IEA’s role as the world’s leading energy authority and its commitment to covering all fuels and all technologies. Guests included Lithunia’s Minister of Energy Žygimantas Vaičiūnas. Lithuania has requested to join the IEA as a member country and the accession process has begun.

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IEA unveils global high-level commission for urgent action on energy efficiency

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The commission will be chaired by Prime Minister Leo Varadkar of Ireland (top-left) and is composed of government ministers, top business executives and thought leaders from around the world

The International Energy Agency has established an independent high-level global commission to examine how progress on energy efficiency can be rapidly accelerated through new and stronger policy action.

Prime Minister Leo Varadkar of Ireland will be the honorary chair of the IEA Commission for Urgent Action on Energy Efficiency, composed of government ministers, top business executives and thought leaders from around the world.

The members include current and former ministers for energy and environment from Denmark, Germany, Ireland, Japan, Luxembourg, Morocco, New Zealand and Spain. Dr Amani Abou-Zeid, the African Union Commissioner for Energy and Infrastructure, and Dr Wan Gang, the previous Chinese Minister of Science and Technology, who is known as the “father of electric vehicles” in China, have also agreed to take part.

Mr Richard Bruton, Ireland’s Minister of Communications, Climate Action and Environment, will chair the commission’s ongoing work. Business leaders taking part include Mr Ben van Beurden, the Chief Executive Officer of Royal Dutch Shell; Ms Lisa Davis, the Chief Executive of gas and power at Siemens; and Mr Gil Quiniones, the President of the New York Power Authority.

More than any single fuel, energy efficiency has a central role to play in meeting global sustainable energy goals. The IEA calculates that with the right policies, the global economy could double in size by 2040 while still maintaining broadly the same level of energy use as today. Those policies alone would enable the world to achieve more than 40% of the emissions cuts needed to reach international climate goals using cost-effective technologies already available, according to IEA analysis.

But policy implementation has slowed and efficiency progress is weakening. Global energy-related CO2 emissions increased last year at their highest rate since 2013, and air pollution continues to be linked to millions of premature deaths each year.

“It is imperative that we get global energy efficiency progress back on track,” said Dr Fatih Birol, the IEA’s Executive Director. “I’m delighted that Prime Minister Varadkar and other eminent figures from around the world have agreed to commit their energy and ideas to this vital project.”

If countries implement all the economically viable energy efficiency potential available today, consumers around the world could save more than half a trillion US dollars through lower energy bills by 2040, while greenhouse gas emissions, air pollution in cities and dependence on energy imports could all be reduced. But this will require firm and rapid action from governments.

“The IEA sees energy efficiency as critical for successful clean energy transitions,” Dr Birol said. “It has huge potential to start making an immediate difference if governments act now and act decisively.”

The focus of the new energy efficiency panel will be on key policy actions that can be taken by countries across the globe. It will produce a concise list of clear, actionable recommendations next year. Plans for the commission were announced last week at the IEA’s largest ever Global Conference on Energy Efficiency in Dublin.

THE COMMISSION

Honorary Chair

H.E. Mr Leo VARADKAR, Prime Minister, Ireland

Members

Dr Amani ABOU-ZEID, Commissioner for Infrastructure and Energy, African Union Commission

H.E. Mr Richard BRUTON, Minister of Communications, Climate Action and Environment, Ireland

Mr Nick BUTLER, Visiting Professor, King’s College London

Ms Lisa DAVIS, Chief Executive Officer, Gas and Power, Siemens AG

Ms Connie HEDEGAARD, Former Commissioner for Climate Action, European Union

Mr Michael LIEBREICH, Chairman and Chief Executive Officer, Liebreich Associates

Dr Ajay MATHUR, Director General, The Energy and Resources Institute, India

H.E. Mr Aziz RABBAH, Minister of Energy, Mines and Sustainable Development, Morocco

H.E. Ms Teresa RIBERA RODRIGUEZ, Minister for Ecological Transition, Spain

Mr Gil C. QUINIONES, President and Chief Executive Officer of the New York Power Authority

Mr Adam SIEMINSKI, President, King Abdullah Petroleum Studies and Research Center, Saudi Arabia

Mr Masakazu TOYODA, Chairman and Chief Executive Officer, Institute of Energy Economics, Japan

Mr Jürgen TRITTIN, Member of the Bundestag and Former Federal Minister for the Environment, Nature Conservation and Nuclear Safety, Germany

H.E. Mr Claude TURMES, Minister for Energy and Minister for Spatial Planning, Luxembourg

Mr Ben van BEURDEN, Chief Executive Officer, Royal Dutch Shell

H.E. Dr WAN Gang, Previous Minister of Science and Technology, China

H.E. Dr Megan WOODS, Minister of Energy and Resources, New Zealand

Dr Kandeh YUMKELLA, Former Special Representative of the UN Secretary-General for Sustainable Energy for All

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