Global low-carbon energy technology investment reached a record-breaking $1.1 trillion in 2022, surpassing investment in fossil fuels for the first time, according to a report from BloombergNEF. Despite supply chain disruptions and economic challenges, investment in clean energy technologies continued to grow, led by renewable energy with a 17% increase to $495 billion. Electrified transport also saw a significant 54% increase, reaching $466 billion spent in 2022.
Nearly every sector in the report saw a new high in investment, including wind and solar energy, energy storage, electrified transport and carbon capturing technologies. China dominated the energy transition investment, accounting for $546 billion, or nearly half of the total, while the US followed at $141 billion and the EU at $180 billion. Hydrogen, while receiving the least investment at $1.1 billion, saw the fastest growth, with investment tripling over the previous year.
The report shows that while 2022’s results were impressive, global investment in low-carbon technologies still falls short of what is required to tackle climate change. To reach net-zero CO2 emissions by 2050, investment must immediately triple, according to BNEF.
Climate-tech corporate finance saw a decrease in 2022, totaling $119 billion, a 29% decline from the previous year. Despite this, venture capital and private equity financing grew 3% year-over-year. Clean energy factory investment, which includes investments in manufacturing facilities for clean energy technologies, rose to $78.7 billion, with China accounting for 91% of these investments.
In conclusion, the report emphasizes the need for more investment in the energy transition to reach the goal of net-zero CO2 emissions by 2050. Despite challenges, investment in clean energy technologies continues to grow, and the sector is poised to overtake fossil fuels.
BloombergNEF press release: Global Low-Carbon Energy Technology Investment Surges Past $1 Trillion for the First Time