Developing renewable power resources such as wind and solar presents a USD 12 trillion investment opportunity over the next 25 years, Michael Liebreich, chairman and founder of Bloomberg New Energy Finance, said during the Investor Summit on Climate Risk held at the United Nations’ headquarters in New York yesterday.
According to a study released by Ceres and Bloomberg New Energy Finance, renewable energy such as wind and solar, especially in emerging markets, is poised for a takeoff due to declining costs that often make them fully competitive with fossil fuels, even without subsidies.
The study, Mapping the Gap: The Road From Paris , details how the global renewable energy buildout in the power sector can be financed, and estimates that investment in new renewable energy projects in the electric sector are expected to surge in the next two decades by nearly USD 500 billion per year above current investment levels.
The study also highlights near-term investment needs in clean energy – specifically, global clean energy investment in the electric sector should more than double from current levels by 2020 in order to achieve COP21’s temperature goals.
“The clean energy industry could make a very significant contribution to achieving the lofty ambitions expressed by the Paris Agreement,” Liebreich said.
“To do so, however, investment volume is going to need to more than double, and do so in the next three to five years. That sort of increase will not be delivered by business as usual; closing the gap is both a challenge and an opportunity for investors.”
The Investor Summit on Climate Risk, organised by Ceres, the United Nations Foundation and the United Nations Office for Partnerships, gathered 500 global investors collectively representing more than USD 22 trillion in assets to explore the types of capital flows necessary and increasingly available to actualize the carbon-reducing commitments made in Paris by 187 countries – commitments that the International Energy Agency estimates would require investments of USD 16.5 trillion by 2030.