Renewable Energy Financing: Funding the Clean Energy Future
Former U.S. President Joe Biden is facing a worsening health situation after his son Hunter Biden said the cancer has spread to his bones and described the disease as "very painful" and "very debilitating."
Money is flowing towards clean energy faster than many expected. The IEA expects global energy investment to reach US$3.4 trillion in 2026, up 5% on last year, and around $2.2 trillion of it is expected to go to grids, storage, low-emissions fuels, nuclear, renewables, efficiency and electrification, with about $1.2 trillion going to oil, gas and coal. (IEA, via The Point and WAM)
Electricity is now the centre of gravity, since electricity-related spending accounts for nearly 60 percent of all global energy investment. This comes despite rising borrowing costs and geopolitical tension. (Greentech Lead) (BusinessDay)
If the money exists, why do some countries still struggle to build projects?
The cost of borrowing for renewable energy has decreased markedly, with IRENA reporting an average capital cost drop from 7.6% in 2010 to 3.9% in 2022, varying by country. Developing nations face higher rates due to risks and inflation, while 85% of renewable investments predominantly benefit only part of the global population, with Sub-Saharan Africa receiving minimal funding. (Systems Change Lab) (AGBI)
IRENA Director-General Francesco La Camera has said the energy transition makes "access to low-cost finance urgently vital". He also describes developing countries as facing a "triple penalty" of policy, capital and infrastructure gaps. (PV Transact) (OPEC Fund Quarterly)
In 2024, 91% of new utility-scale renewable projects produced cheaper electricity than the least expensive fossil fuel option, indicating an improvement in economics despite the need for affordable clean energy capital. (OPEC Fund Quarterly)
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