In recent years, India has seen rapid growth in clean energy investments, driven by ambitious targets amid its status as the world’s fastest-growing major economy in 2023. Despite this economic growth, challenges such as poverty alleviation and job creation remain paramount. Energy demand in India is set to outpace all other regions by 2050, fueled by urbanization and infrastructure development, yet the country heavily relies on imported fossil fuels like crude oil and natural gas.
To tackle these challenges, India has embarked on various strategies for decarbonization and diversification. Notably, it aims for net zero emissions by 2070 and has significantly scaled up investments in solar and wind power. Initiatives like the Production Linked Incentives scheme and a new hydrogen policy underscore its commitment to boosting domestic manufacturing of clean energy technologies.
In 2023, India made headlines with its debut in the sovereign green bond market, issuing bonds worth USD 1 billion. This move, oversubscribed more than four times, marked a significant shift towards financing renewables, metro rail lines, and low-carbon hydrogen production. Such efforts have propelled Indian clean energy investment to USD 68 billion in 2023, up nearly 40% from previous years.
Meanwhile, global leaders like China, the European Union, and the United States continue to dominate clean energy investment, accounting for nearly 60% of global spending. The United States, for instance, bolstered its clean energy investments to USD 280 billion in 2023, while maintaining substantial investments in oil and gas.
Latin America, despite being a leader in renewable energy with a 60% share of renewables in its power mix, faces challenges in scaling up investments to meet its climate goals. Clean energy investment reached record highs in 2024 but still lags behind global averages.
In the European Union, heightened policy responses to the global energy crisis have driven increased investments in renewables and energy grids, supporting its goal to reduce net greenhouse gas emissions by at least 55% by 2030.
Africa struggles with significant debt and financing barriers that hinder large-scale clean energy projects, despite vast renewable energy potential. Annual clean energy investments remain low, limiting progress towards achieving universal energy access by 2030.
The Middle East, known for its oil and gas dominance, is gradually increasing its investments in clean energy, driven by commitments to achieve net zero emissions by mid-century.
In Asia, Japan and Korea are leading in clean energy investments, with strong policies and financial incentives supporting their transitions towards carbon neutrality by 2050.
Southeast Asia aims for carbon neutrality by mid-century but faces challenges in attracting sufficient investments to meet these targets, with current clean energy spending well below required levels.
Eurasia, with its diverse energy landscape, is navigating the transition from fossil fuels to clean energy amidst geopolitical tensions and aging infrastructure, setting net zero targets but struggling to attract adequate investments.
Overall, while global clean energy investments are rising, significant disparities remain between regions in terms of policy support, financing accessibility, and infrastructure readiness. Addressing these disparities will be crucial to accelerate the global transition towards sustainable energy systems and mitigate climate change effectively.
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- Source: https://solarquarter.com/2024/06/15/global-clean-energy-investment-trends-and-challenges-across-regions-iea/