2023 Investments (Energy Transition, Grids, Startups), Corporate Clean Power, Things to Watch in 2024 (Storage, Metals, Decarbonization)
Guillaume Fouché
Business Leader Latin America, Caribbean, US Mid-Atlantic & South East @BloombergNEF | Co-Founder & Board Member @AMIVE | MBA | Clean Energy, Mobility & Sustainability
Hi, welcome to another edition of The Race to NetZero Newsletter, a monthly round-up of the best research and news from BloombergNEF.
Find below the best content published by our analyst team in the past month:
Global Clean Energy Investment Jumps 17%, Hits $1.8 Trillion in 2023
Global investment in the low-carbon energy transition surged 17% in 2023, reaching $1.77 trillion, according to Energy Transition Investment Trends 2024, a report published today by research provider BloombergNEF (BNEF). This number is a new record level of annual investment and demonstrates the resilience of the clean energy transition in a year of geopolitical turbulence, high interest rates and cost inflation.
The report finds that electrified transport is now the largest sector for spending in the energy transition, growing 36% in 2023 to $634 billion. This figure includes spending on electric cars, buses, two- and three-wheelers and commercial vehicles, as well as associated infrastructure.
Global Grid Gets $310 Billion Lift in Step Toward Net Zero
By Sanjeet Sanghera , Head of Grids & Utilities, BloombergNEF
Capital investment in global power grids jumped 5% in 2023 from the previous year to $310 billion, according to analysis by BloombergNEF, welcome news in a period that otherwise saw increased grid congestion and longer interconnection queues.
The US led the pack spending $87 billion, with significant portions for increasing grid resilience to threats such as storms, including by burying power lines. Distribution grids took the lion’s share of spend in the US at 64% with the balance going to transmission grids. Distribution grid investment is growing most in countries that have rising electricity demand or are experiencing rapid growth in distributed clean energy resources, both of which are taking place in the US.
Over $50 Billion Flow to Climate-Tech Startups in a Stormy Year
By Musfika Mishi , Technology & Innovation, BloombergNEF
Climate-tech companies raised $51 billion in venture capital and private equity funding across more than a thousand deals tracked by BloombergNEF last year. Though this was 12% lower than 2022, the slide was a fraction of the 35% reported for all startups by Pitchbook. Most of the funding went to low-carbon energy and low-carbon transport companies.
Offshore Wind Investment Hit All-Time High in 2023
By Oliver Metcalfe , Head of Wind Research, BloombergNEF
Offshore wind investment surged to a new high in 2023, according to BloombergNEF’s Renewable Energy Investment Tracker 1H 2024. The record comes despite rising costs and interest rates forcing some firms to delay or cancel projects last year.
Global offshore wind investment reached a record $76.7 billion, jumping 79%. This offset the 17% year-on-year decline from the onshore segment. China remained the largest offshore wind market, in spite of a down year, followed by the UK and the US.
Corporate Clean Power Buying Grew 12% to New Record in 2023
Corporations publicly announced a record 46 gigawatts (GW) of solar and wind contracts in 2023, some 12% more than the previous record of 41GW in 2022. The improving economics in key regions like Europe, alongside imminent company clean energy goals, were the main drivers underpinning this growth and position the market even better for 2024, finds BloombergNEF (BNEF) in its 1H 2024 Corporate Energy Market Outlook.
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According to BNEF, since 2008, corporations have announced power purchase agreements, or PPAs, for 198GW of solar and wind – greater than the power generation capacity of countries like France, the United Kingdom and South Korea. The PPA market has grown 33% on average since 2015 and catalyzed hundreds of billions of dollars of investment into the energy transition, marking the seventh year that the corporate PPA market has reached a new high.
Energy Storage: 10 Things to Watch in 2024
By Yayoi Sekine , Head of Energy Storage, BloombergNEF
Battery overproduction and overcapacity will shape market dynamics of the energy storage sector in 2024, pressuring prices and providing headwinds for stationary energy storage deployments. This report highlights the most noteworthy developments we expect in the energy storage industry this year.
Metals and Mining: 10 Things to Watch in 2024
By Dr. Kwasi Ampofo , Head of Metals and Mining, BloombergNEF
The prices of industrial metals such as copper and aluminum ended last year with a rally and have room to keeping grow this year as supply disruptions and steady demand maintain upward pressure. By contrast, the prices of battery metals such as lithium and cobalt declined across 2023 and are likely to remain subdued amid an anticipated slowdown in the growth of electric vehicle sales. Having surveyed the outlook across the two landscapes, these are the 10 key trends BloombergNEF has identified to watch in the metals and mining space in 2024
Industrial Decarbonization: Things to Watch 2024
By Julia Attwood , Industrial Decarbonization Specialist, BloombergNEF
The year 2023 did not quite live up to expectations, but it still brought the first large-scale hydrogen-based steel production, marked progress in plastic chemical recycling, and large direct air capture announcements. Now, 2024 could bring greater diversity of projects and more focus on bottlenecks – with permitting woes for carbon capture addressed, more countries committing to green steel projects, and the first demand signals for green cement.
Global Carbon Market Outlook 2024
Prices across some carbon markets are expected to inch closer together in 2024, as newer programs break records and more mature schemes cool. Looming net-zero targets are pushing regulators to tighten supply and include more sectors. Meanwhile, the gap between compliance and voluntary markets continues to narrow, as recently established compliance programs appear more lenient on the inclusion of carbon offsets.
For more BNEF public content, don't hesitate to check-out our Blog here or if you prefer to watch videos, there are plenty of videos in our Vimeo Channel here, you can also check-out our Podcast: Switched-On.
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Best Regards, Saludos, Cordialement
Guillaume