Context: The World Energy Investment Report 2021 (IEA) estimated that Global energy investment is expected to rebound in 2021 and increase 10 per cent year-on-year to around $1.9 trillion.

• It is rebounding nearly 10% from 2020 and bringing the total volume of investment back towards pre-crisis levels.

Key highlights of the International Energy Agency’s (IEA) report

• Renewable power will have the largest share — around 70 per cent of the total $530 million will be spent on new power generation capacity.
• Substantial gain of renewable as the future energy outlook has been dependent on technological development, well-established supply chain and demand from consumers for carbon-neutral electricity.
• Energy efficiency sector will also see a substantial rise (10 per cent) in investment, though the low fossil fuel price may act as a deterrent.
• The global energy demand will rise 4.6 per cent year-on-year in 2021, offsetting its contraction in 2020.
• Upstream investment in oil is expected to grow 10 per cent.
• This expansion in fossil fuels was planned with novel technologies like carbon capture and storage (CCS) and bioenergy CCS, which are yet to be attain commercial success. The increment of coal-fired power in 2020, mostly driven by China, is indicating that ‘coal is down but not yet out’.

The Carbon Dioxide emissions

• Global carbon dioxide emission is set to grow by 1.5 billion tonnes this year. The rhetoric around ‘Net Zero’ is gaining momentum but its transition to actual action is not visible.
• The emerging market is almost 70 per cent responsible for demand growth and India plays an important part in this block.
• China is showing a tremendous expansion in coal-based power production — their coal consumption in December 2020 was a historic high — though the country has a commendable renewable growth.

The responsibility-share of developed nations should not be undermined:

• Australia’s exported emission through coal is double its domestic emission.
• The USA’s fascination with cheap shell gas is creating an investment distortion and adversely affecting the sustainability of developmental pathways of countries like India.
• Market stimulus amid the pandemic may have lost the opportunity to maximise the clean developmental pathway.

Suggestions provided by the Report

• Clean energy investment would need to double in the coming years to maintain temperatures well below a 2 °C rise. It needs to be more than triple in order to keep the door open for a 1.5 °C stabilisation.
• A democratic decision-making process and de-corporatisation of the energy sector is the need of the future for the survival of civilization on this planet.