The world needs to nearly triple investments in low-carbon electricity and carbon capture technologies in the power sector for a chance to reach net-zero emissions by 2050, according to a new report by BloombergNEF.
Investments in these two areas reach $17 trillion between now and 2050 under a scenario where economic forces and technological tipping points drive the energy transition without policy interventions. That number would need to reach $45.8 trillion by 2050 under the net zero scenario, according to the report.
Conversely, capital requirements for fossil fuel processes, encompassing their use in transport, industry and buildings, total $23.9 trillion and 20% of overall investments in the economic transition scenario and drop to $13.6 trillion, a 7% share, in the net zero scenario.
“To get on track this decade, there needs to be $3 invested in low-carbon supply for every $1 in fossil-fuel supply,” David Hostert, global head of economics and modelling at BNEF and lead author of the report, said in a statement.
Clean power deployment would need to quadruple by 2030, in addition to major investments in carbon capture and storage, advanced nuclear technologies, and hydrogen, he added.
In both scenarios, the growing uptake of electric vehicles represents significant spending, amounting to $2 trillion per year on average in the 2030s in the economic transition scenario and $3.8 trillion per year in the net zero scenario. Cumulatively, EVs represent close to half of all energy infrastructure spending between now and 2050.