Renewable energy investment at record $499 bil in 2022 not enough for climate goals

Renewable energy investments rose to a record $499 billion last year, but it still isn't enough to keep global temperatures from rising more than 1.5 C, according to a joint paper released Feb. 22 at the Spanish International Conference on Renewable Energy in Madrid.

The total investments were up 16% from 2021, according to the report by the International Renewable Energy Agency and Climate Policy Initiative. But that's still less than 40% of the average investment needed each year through 2030 under IRENA's 1.5 C scenario which seeks to limit rising global temperatures to no more than 1.5 C.

The concentration in more developed technologies also appears to have continued into 2022, the report authors said. In 2020, solar photovoltaic took up 43% of all investments in renewables, followed by onshore wind at 35% and offshore wind at 12% for 2022, according to the report.

"To best support the energy transition, more funds need to flow to less mature technologies as well as to other sectors beyond electricity such as heating, cooling, and system integration," IRENA and CPI said in a statement.

Installed solar energy capacity is forecast to double by 2027 from 2022 with solar penetration in the EU and US markets surpassing 10% of generation by 2027, according to the latest forecasts by S&P Global Commodity Insights in January.

Onshore wind capacity will climb around 9% a year out to 2028 against 22% a year for offshore wind, "as development constraints shift the industry's focus," S&P Global said in the report (see chart).

The amount invested in renewables compares with $953 billion poured into fossil fuels in 2022, up from $897 billion in 2021, according to the IRENA/CPI report citing IEA data.