According to in-depth research from `Rystad Energy` (Norway), `global energy spending` is projected to reach an unprecedented record of over $2.1 trillion in 2022. Notably, `green energy spending` is anticipated to constitute approximately 31% of this total expenditure, demonstrating a robust growth of around 24% compared to 2021, equating to a substantial increase of $125 billion in `renewable energy investment`. This accelerating trend underscores the global shift in `energy transition trends` toward sustainable practices.
Solar Energy Costs Increased by 64%
`Rystad Energy` further forecasts that global solar and wind capacity will expand by 250 GW in 2022, based on current project pipelines. This includes an estimated 140 GW from concentrated `solar energy` and 110 GW from `wind energy`. The surge in `green energy spending` is undeniable, with an expected 24% growth, adding $125 billion compared to the previous year. Within this growth, key sectors such as `solar power`, `carbon capture and storage (CCS)`, hydrogen, and geothermal technologies are experiencing the fastest expansion, with growth rates ranging from 40% to 60%. Specifically, `solar power costs` witnessed the most significant increase, climbing by 64%, and are projected to reach $191.47 billion. Onshore `wind power growth` is also substantial, anticipated to increase by 24%, surpassing $209 billion in investment. This highlights the strong `renewable energy investment` landscape for 2022. For a `detailed analysis of green energy expenditures`, consider reviewing expert reports.
Global energy spending (Source: Rystad Energy)
The escalation in `global energy costs` in 2022 can be attributed to several compounding factors. These include post-Covid-19 pandemic inflation and significant increases in oil, gas, and power prices, further exacerbated by the `European Union`’s strategic efforts to reduce its reliance on Russian gas supplies. For `green energy` sources, rising raw material prices—such as for lithium, nickel, copper, and polysilicon—are also contributing factors to increased `solar power costs` and overall `renewable energy investment`. Fundamentally, the primary driver behind the growing share of `renewable energy costs` within total `global energy spending`, and the accelerating capital inflow into `green energy`, is the overarching trend of the `energy transition trends`. This shift is rapidly advancing the development of low-emission energy sources with the critical objective of reducing `greenhouse gas emissions` to achieve `net-zero emissions` by mid-century, aligning with global `sustainable development goals`.
Renewable Energy Will Continue to Grow
Global `renewable energy` capacity reached an unprecedented high in 2021, with approximately 290 GW of new capacity becoming operational. `Solar power` accounted for over half of this remarkable increase in additional `renewable electricity` generation, followed closely by `wind energy` and hydroelectricity. Despite the ongoing complexities introduced by the Covid-19 pandemic, `wind power` experienced another successful year, contributing an impressive 93.6 GW to the cumulative global `wind power growth` capacity, which now totals 837 GW. This significant expansion signals a robust trajectory for `increasing investment in renewable energy` globally.
Wind power continues to grow significantly in 2021, with approximately 94 GW of additional capacity (Internet photo)
Beyond the inherent `energy transition trends` and global commitments to reducing `greenhouse gas emissions`, the geopolitical impact of the Russia-Ukraine military tension is further accelerating the expansion of `renewable energy`. The `European Commission` has declared that the `European Union` must cut gas imports from Russia by two-thirds this year and eliminate this energy source entirely by 2027. Consequently, the `European Union` government and major corporations are actively collaborating to vigorously promote `renewable energy` sources, particularly `solar power` and `wind power`, in their urgent search for viable alternatives. According to current plans, the `European Union` aims to dramatically increase the percentage of `renewable energy` in its final energy consumption to 40% by 2030. As of April 10, 2022, the Commissioner for `EU climate policy` indicated a potential for even more ambitious `EU renewable energy targets 2030`, driven by the `EU Repower` initiative, which specifically advocates for accelerating the `energy transition trends`.
Previously, the `European Union`’s 27 member states collectively pledged to reduce overall net emissions by 55% from 1990 levels by 2030, a crucial step towards achieving the EU’s overarching goal of `Net Zero emissions` by 2050.
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By the end of 2021, the total installed `renewable energy capacity in Vietnam` reached 20,670 MW, representing 27% of the nation’s total installed capacity of 76,620 MW. `Renewable energy` generated 31,508 billion kWh of total power, accounting for 12.27% of the overall system output. The Ministry of Industry and Trade is currently finalizing `Power Plan VIII`. The Office of the Government recently issued a notification on the conclusion of the permanent Government regarding `Power Planning VIII` on March 31, 2022. The Ministry of Industry and Trade has been tasked with completing `Power Plan VIII` for its approval in April 2022. Critically, the development perspective must prioritize an independent and self-sufficient economy, emphasizing the autonomy of the `energy industry` and reducing dependence on foreign sources. This vision is intrinsically linked to maximizing and rationally exploiting domestic primary `energy resources` for power generation, such as natural gas, `wind energy`, `solar energy`, ocean waves, and other indigenous sources; simultaneously, it mandates balancing and judiciously utilizing imported LNG sources. Specifically for `rooftop solar power` that has already been invested in, if it adheres to regulations, serves the correct purposes, and does not exploit profit mechanisms, then the energy consumption balance will be calculated, and the capacity of 7,755 MW of `rooftop solar powerhouse` will be excluded from the data of total power capacity in the planning.
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Refer data: Rystad Energy, GWEC, EVN
Vu Phong Energy Group
