Global investment in renewable energy down 7% in 2017

Global investment in renewable energy down 7% in 2017

Last year, global energy investment was US $ 1.8 trillion, down 2 percent from 2016, according to the World Energy Investment 2018 report released by the International Energy Agency of Energy (IEA).

More than US $ 750 billion was spent on the electric sector , while US $ 716 billion was invested in the supply of oil and gas globally in 2017.

Investments driven by state-owned enterprises account for a growing share of global energy investment, which has grown by over 40% over the last five years, mainly due to modifications and rebuilding in national networks to balance demand and supply.

However, investments in the sector, accounting for two-thirds of energy spending (US $ 300 billion), fell by 7% in 2017. The IEA predicts that this rate will continue to decline this year, stressing that “the implementation of policies of energy efficiency and the improvement of global energy intensity are slowing. ”

This decline is due to the shift in the focus of energy grid improvements, as well as lower capital costs for onshore wind projects, as well as a drop in investment in hydropower.

It also weighs down the support of governments for the development of solar projects, such as China’s decision to cut subsidies for new projects, which increases the risk of slowing investment in the sector this year.

As China accounts for more than 40% of global investment in photovoltaic solar energy, its shifts in incentive policy have global implications. This reiterates the critical importance of public policies in the conduct of investment in renewable energy, the Agency assesses.

The report also reveals that investment in fossil fuels increased last year for the first time since 2014, in part due to the increased purchasing power of the oil and gas industry.

The participation of the national oil companies in total investment in the sector has remained close to records, a trend that the IEA expects to continue this year.

The US shale industry is also seeing an upward trend after a long period of financial fragility. Already investment in the nuclear sector sank to its lowest level in five years, according to the report.

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Arnaud Lefevre

Arnaud Lefevre is the Chief Executive Officer of Dynatom International. Arnaud is in charge of the international development of the business portfolio.