As the impacts of climate change and the importance of decarbonization have started to become clear, it’s hard to ignore the ongoing shift towards embracing renewables.Today, the renewables energy market has already become the energy industry’s biggest driver of growth, and both governments and businesses have been pressed to solidify their commitments to green energy.
Renewable Energy’s Growing Market Presence
Investments in clean energy have been growing both quickly and consistently.Before 2010, annual global investment in clean energy climbed from just tens of billions to $177 billion in 2009. But in the following decade, annual investment in renewables regularly surpassed $200 billion, reaching $303.5 billion in 2020.Early spending in the field was led by the EU, but recently China and the U.S. have become the world’s largest spenders in clean energy.Combined with increasing pressure from shareholders of public companies (and especially energy producers) for climate-related resolutions, 2021 is expected to be the first time renewable energy surpasses oil & gas as the energy industry’s largest area of spending.At the same time, governments are feeling pressured to commit to the Paris climate accords beyond mere statements, with many countries signing net-zero emission laws.
Wind and Solar Lead The Renewable Energy Shift
Knowing where the shift towards clean energy is happening is equally as important.Early investments in clean energy transitions were spread out across many promising sectors, including hydro, nuclear, and carbon-capture for fossil fuel production. But over the past 10 years, wind and solar energy have been leading the charge.Levelised costs for solar electricity are already estimated as lower than gas or coal as of 2020, thanks to rapidly dropping output costs.
In terms of capacity, the global installation of wind and solar has already eclipsed hydro electricity, and is expected to pass both gas and coal by 2024.Expected increases in renewable energy capacity are estimated to almost match the increasing global demand for energy. However, much of that demand is still expected to be met by fossil fuels, especially for regions with massive, scalable demand.But as the renewable energy shift continues to pressure greater adoption of clean energy measures, further investment in renewable production and cost cutting, the market demand is expected to shift to green as well.
How Can Investors Take Part?
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