In focus: Investments in clean energy to top $1.7 trillion in 2023

Worldwide investments in clean energy are projected to reach $1.74 trillion in 2023, a 7.6 percent increase compared to $1.617 trillion invested in green energy in 2022, according to a recent report by the International Energy Agency (IEA).

The investments in fossil fuels are also expected to rise, from $1.002 trillion in 2022 to $1.05 trillion in 2023, according to IEA’s World Energy Investment 2023 (WEI 2023) report.

If the results are as projected, 2023 would be the eighth straight year in which investments in green energy topped the investments in fossil fuels, with the ratio growing in favour of clean energy each year since 2016, the report shows.

The report also indicates that annual clean energy investment is expected to rise by 24 percent between 2021 and 2023, driven by renewables and electric vehicles, compared with a 15 percent rise in fossil fuel investment over the same period.

With the investment landscape changing in favour of green energy and technologies each year, the question arises of how assets currently used and deployed in the fossil fuel industry can be repurposed and re-tooled to bridge the gap and expedite the energy transition and the switch to net-zero.

The skills and trained personnel gap is one of the issues facing the clean energy markets seeing that currently, the ambitions do not match the supply.

One of the answers surely is tapping into the workforce currently engaged within the fossil fuel market to narrow the skills gap within the emerging clean energy markets, as well as the established markets such as offshore wind.

Repurposing the existing oil and gas infrastructure to further develop clean energy industries has also been identified as a great chance to give a new lease on life to assets that would otherwise be stranded and/or decommissioned.

This seems like a win-win scenario as it potentially reduces the cost of the projects, eliminates the costs of decommissioning, and also has the potential of reducing the environmental impact of the new projects.

The maritime and shipping industry is making efforts to keep its end of the bargain in an effort to decarbonise by making significant investments in the greening up of vessel fleets.

This week saw the delivery of the world’s first ammonia-ready containership – the CMA CGM Masai Mara.

The vessel was built for the Belgian shipowner, CMB, the company whose subsidiary, Bocimar, is building up to nine ammonia-powred Newcastlemaxes in China in cooperation with WinGD.

The week also saw vessel owners and operators such as Grimaldi Group and Grieg Maritime place orders for ammonia-ready vessels.

Ammonia seems to have been the alternative fuel of choice for vessel owners this week, and the technology reached another milestone with MAN ES getting ready to test its two-stroke ammonia engine.

However, the road towards net zero within the maritime and shipping industry will rely on the availability of alternative fuels in the future as much as it relies on the industry to invest in alternative fuel-ready vessels.

Maersk Mc-Kinney Moller Center has issued an analysis identifying four potential constraints that could lead to shortages in the supply of e-fuels in the 2030s and 2040s.

First of all, a little explainer of what e-fuels are. E-fuels are made by synthesizing captured CO2 emissions and hydrogen produced using renewable or CO2-free electricity.

The fuels release CO2 into the atmosphere when used in an engine. But the idea is that those emissions are equal to the amount taken out of the atmosphere to produce the fuel – making it CO2-neutral overall.

According to the analysis, to meet 50 percent of the industry’s energy demand with e-fuels by 2050, an estimated 1,100 GW of renewable electricity capacity needs to be installed. However, the global demand for renewable electricity across industries calls for approximately 25,000 GW of capacity by 2050, with wind and solar leading the way. Meeting these demands will require significant investment and technological advancements.

The article below delves into the four constraints identified in more detail.

Hydrogen as a clean fuel and an energy storage option is increasingly becoming one of the key pillars in the energy transition and a cornerstone in an increasing number of large-scale projects.

Finland and Estonia are ready to launch the BalticSeaH2 project – a large-scale cross-border hydrogen valley gathering 40 partners from nine Baltic Sea region countries. The project has the potential to produce 100,000 tonnes of hydrogen annually.

Subsea7 has announced two initiatives in Scotland, one related to pairing a floating hydrogen production system with a floating wind farm, and the other focused on investigating the feasibility of establishing underwater hydrogen storage.

Subsea 7 and OneSea Energy will look into the technical feasibility and commercial value of coupling a large-scale floating hydrogen production unit with a floating offshore wind farm.

Through the feasibility study, the two companies intend to explore the opportunity and prove the relevance of floating hydrogen production in the Scottish context, based on OneSea’s developed technology and concept, and relying on Subsea 7’s experience in broader energy systems integration and delivery of projects in Scotland as well as an understanding of the Scottish business environment, supply chain, and market context.