Last week the International Energy Agency issues its latest bulletin on global energy investment. It has surveyed global investment in energy across its various forms, and it there’s something of a turning point tucked away in the statistics.
First, overall investment was down in 2015, falling by 8%. The reason for this is that, as expected, a low oil price has deterred investors from putting their money into oil projects. Half of the world’s energy investment goes towards oil, so what happens in the oil market tends to swing the overall figure. The IEA note that is is private investors that are pulling back. State investment – from governments who rely on oil to stay solvent – is at an all time high.
In renewable energy, investment hasn’t gone up, which is is disappointing. However, because the price of renewable technologies is falling so sharply, we’re getting more energy online for the same funding.
Here’s the interesting bit about renewable energy investment though. In the IEA’s words, “the investment in renewable power capacity in 2015 generates more than enough to cover global electricity demand growth.”
I missed the significance of this when I read the press release, but Chris Goodall highlights what that actually means: “in other words, the demand for electricity from fossil fuels is now falling for the first time in history.”
A small point tucked away in a statistical bulletin is nothing to get excited about, but for those of us that are watching the energy transition, it’s another marker that things are moving in the right direction. Still too slowly, and the gains are still in electricity generation rather than energy use overall, but the fossil fuels juggernaut is nevertheless slowing.