A recent report released by the International Energy Agency says that today's level of capital expenditure on resources is still far from adequate to deal with the energy and climate crises, against the backdrop of rising costs of energy. Global energy investment will grow by 8% to $2.4 trillion in 2022. Growth is expected to come primarily from clean energy.
Despite the uptick in energy investment, the growth is still far from sufficient to address today's energy crisis on multiple fronts. Following current trends will hardly pave the way toward a cleaner, more secure energy future.
The report shows that the fastest growing energy investment is in the power sector. The main focus is on renewable energy, the grid and energy storage. All of these areas require large amounts of wires and cables (alambres y cables de potencia).
However, the growth in clean energy spending is not evenly distributed by region, with much of it occurring in developed economies and China. In some regional markets, energy security concerns and higher prices are driving increased investment in fossil fuels, particularly coal.
The high prices of fossil fuels are currently causing pain in many economies. But they are also bringing windfall wealth to oil and gas producers. By 2022, revenues from the global oil and gas industry will jump to $4 trillion. That's more than twice the five-year average, much of which will go to major oil and gas exporters.
These revenues offer a once-in-a-lifetime opportunity for oil and gas producing economies. They will finance much-needed economic transformation and provide major oil and gas companies with additional measures to diversify their spending. Overall, clean energy investments account for about 5% of global oil and gas companies' capital expenditures, up from 1% in 2019.
Tight supply chains also played an important role in the overall increase in investment. Almost half of the overall spending growth reflects higher costs, from labor and services to cement, steel and key raw materials (materiales primas como conductores). These challenges have prevented some energy companies from increasing spending more quickly.
Clean energy technologies require large amounts of key minerals, and the World Energy Investment Report provides the first detailed review of investment trends in key minerals.
Higher and more diversified investments are expected to be needed to curb today's price pressures and create a more resilient clean energy supply chain. 2021 saw a 30% increase in global mineral exploration spending. Growth from the U.S., Canada and Latin America will provide the prospect for more diversified supply in the years ahead.
Since the signing of the Paris Agreement in 2015, clean energy investments have grown by only 2% per year until 2020. But since 2020, growth has accelerated significantly to 12 percent. Clean energy has been helped by government financial support and the rise of sustainable finance.
Renewable energy, electric grids and energy storage now account for more than 80% of total investment in the power sector. Spending on solar PV, batteries and electric vehicles is growing at a high rate. The rate of growth is in line with the goal of achieving net zero global emissions by 2050.