NEW YORK, Nov 1 (Reuters) – Investment in low-carbon technologies needed to reduce global warming emissions in emerging markets fell four years ago even as funding continued in developed economies, according to a survey released on Tuesday.
Building more clean energy plants in developing economies to help transition them away from fossil fuels will be high on the list of priorities for world leaders gathering in Egypt for a United Nations conference from November 6.
These markets account for nearly half of the world’s greenhouse gas emissions, but little money has flowed into low-carbon initiatives since the COVID-19 pandemic has strained global supply chains and shrinking project pipelines, BloombergNEF analysts said in a study.
Equity and debt financing for wind and solar plants, carbon capture and storage, electrified heat and transportation, energy storage and hydrogen and nuclear worldwide will reach a record high of $785 billion by 2021, nearly a quarter more than a year ago, BloombergNEF got it.
But among that total, emerging economies saw investment fall 9% from the 2018 peak to just under $67 billion in 2021, while rich countries saw a 53% increase.
Most of the world’s companies and governments have supported the target of reducing greenhouse gas emissions to net-zero – no more than can be reabsorbed in natural sinks such as forests or other technologies – by 2050. 2030, according to the International Energy Agency.
One of the barriers to investment in renewable energy in emerging markets in 2021 was the lack of auctions of energy supply contracts, which historically provided significant incentives and protections to developers in these countries. A lack of auctions could mean fewer clean energy projects are built over the next few years, BloombergNEF said.
Report by Isla Binnie; Edited by Leslie Adler
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