Investment of $1tn a year needed for 2030 climate goals, report finds

Annual investments of about $1tn in renewable power and up to $130bn in hydrogen by 2030 are needed to avoid the catastrophic effects of climate change, a landmark report on behalf of 45 world leaders concludes.

The report calculated the world would need to add four times the amount of renewable energy that was deployed in 2021 every year by 2030, and drastically scale up hydrogen production to reach net zero emissions and stem global warming from burning fossil fuels.

Up to 8TW of additional renewable capacity will be required by 2030, from about 3TW last year, according to the research jointly published by the International Energy Agency, the International Renewable Energy Agency and the UN, ahead of the COP27 climate summit in November.

The supply of “renewable” and “low carbon” hydrogen, the latter using carbon capture technology to trap emissions, would also need to increase to about 150 Mt by 2030 — implying a doubling each year from 2023.

The paper was commissioned by the 45 governments making up 70 per cent of the global economy that signed a commitment, dubbed the “breakthrough agenda” at the UN climate summit, to make clean technologies affordable and accessible by 2030. They include the US, the EU bloc countries, Australia, Egypt and Nigeria.

The findings were focused on the five key areas of power, road transport, steel, hydrogen and agriculture, that together account for more than 50 per cent of current global emissions.

Recommendations for how to reach the goals included the negotiation of international standards for “low-carbon” hydrogen, higher minimum energy performance standards for energy-intensive appliances, and common target dates by which all new road vehicles must be zero emission.

Presently, a piecemeal approach is being taken by countries, and even within states and regions, towards these goals.

“Progress is not yet fast enough to meet the goals that countries have agreed under the breakthrough agenda,” it added.

Countries and companies must work together to create and scale markets for clean technologies, the report said, including through purchase commitments and processes to channel finance and technical assistance to coal-producing countries to shift away from the fossil fuel.

Among the biggest impediments was a “collaboration gap” that threatened to delay reaching net zero “by decades”, it warned.

While the global energy crisis as a result of Russia’s invasion of Ukraine has escalated the demand for renewable energy, the tough economic conditions have pushed countries to adopt protectionist stances.

“We are entering the first truly global energy crisis . . . [which is] affecting almost everybody around the world,” said Fatih Birol, IEA executive director. “It’s important to separate facts from fiction . . . clean energy is not a driver but a lasting solution to the current and the next energy crisis to come.” 

Developing countries have branded as hypocritical the clamouring by European nations for alternative gas supplies to replace those no longer being imported from Russia, given that rich nations have urged poorer ones not to develop fossil fuel reserves to curb global warming.

“We cannot leave Africa to have only renewable energies,” said Macky Sall, the president of Senegal, at the Africa Adaptation Summit this month. “No country has managed to develop with only renewable energies.”

Urging international collaboration on clean energy, Francesco La Camera, director-general of Irena, said that, while it was “needed more than ever”, the energy, food and inflation crises meant the “very concept of co-operation is challenged”.