The International Renewable Energy Agency (IRENA) has cautioned that the world's energy transition is currently “off-track,” emphasizing the need to diversify renewable energy investments beyond solar photovoltaic and wind power technologies. In its 2023 outlook, IRENA revealed that global investment in renewable energy reached $500 billion in 2022. However, a staggering 85 percent of this investment benefited less than 50 percent of the global population, and 95 percent of the funds were allocated to solar photovoltaic and wind power projects. To rectify this imbalance, IRENA called for increased funding in alternative sectors such as biofuels, hydropower, geothermal energy, and other energy-consuming sectors like heating and transportation.
IRENA further highlighted that the $500 billion investment falls significantly short of the required funding to achieve the targets outlined in the Paris accord, aimed at limiting global warming to 1.5 degrees Celsius. According to the agency, the current investment amounts to only one-third of the necessary funds.
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Apart from the concentration of investments in specific technologies, IRENA expressed concerns about the limited number of countries actively promoting renewable energy. Director-General Francesco La Camera stressed the worrisome geographic concentration of energy transition progress, which has largely excluded nearly half of the global population, especially those in countries with significant energy access needs.
In a recent interview with ETN, La Camera drew attention to the inadequate progress in renewable energy adoption worldwide, particularly in Africa, where he noted that renewable energy accounted for a mere 1% of the installed capacity. La Camera emphasized that to remain on track, the world must add 1,000 GW of renewable energy capacity annually until 2030. Additionally, he highlighted IRENA's recommended energy mix, which advocates for a reversal of the current 66:33 ratio of fossil fuels to renewable sources. According to IRENA's proposal, the ideal energy mix should consist of 33 percent fossil fuel energy and 66 percent renewable energy sources.
The findings from IRENA's 2023 outlook underscore the urgency to address the imbalances in renewable energy investment and geographic disparities. Achieving a sustainable energy future requires greater diversity in funding and technological innovation, coupled with broader international cooperation to ensure equitable access to clean energy for all.
