Electricity drew more investment than fossil-fuel supply for the first time last year, as the energy industry prepared for electrification of everything from cars to buildings and industrial processes.
Power generation and electricity grid expansions took in US$718 billion, 42 percent of the US$1.7 trillion invested in energy last year, an International Energy Agency (IEA) report released yesterday said.
By contrast, oil, gas and coal supply reaped US$708 billion, a drop from last year, reflecting lower prices and profits by major oil companies.
The findings are another milestone marking a shift in the world energy industry away from the most polluting fuels as governments respond to the threat of global warming and the cost of renewables, such as wind and solar power, plunges to compete with fossil fuels.
“Oil and gas was the largest investment source for 100 years. This changed in 2016,” IEA chief economist Laszlo Varro said on a conference call. “With robust investment in renewable energy, increased investment into electricity networks, electricity is now the biggest area of capital investment.”
Renewable energy and networks made up 80 percent of all electricity investment, according to the IEA’s calculations.
New “green” power projects attracted US$297 billion last year, a decline of 3 percent from the previous year, caused by cheaper solar panels and wind turbines. Installations rose by 5 percent during that period.
Energy projects are capital-intensive and take years to develop and construct, so decisions made and money spent today shine a light on what the energy system is to look like in the decades to come.
The shift of capital flows away from fossil fuels and toward electricity, particularly “clean” sources such as solar and wind, shows that the trend spurred by the Paris climate accord is seeping into the business of energy.
China received more than one-fifth of global investment. Companies spent their capital on low-carbon electricity generation and networks, making up 65 percent of the global total at US$259 billion.
Investment into the US’ energy system rose 16 percent, mostly driven by renewable energy, the report said.
The IEA does not anticipate a revival of the coal industry, even with US President Donald Trump’s promise to bolster mining, because of market forces that started under the previous Republican US president, George W. Bush.
Europe’s offshore wind industry hit a record for investment decisions for new projects, rising to US$20 billion for 5 gigawatts of capacity. That is a 40 percent increase from the year before.
India’s spending on energy rose by 7 percent, as the Indian government sought to extend its electricity grid and improve access. Investment into coal stations rose 10 percent to US$20 billion, while capital flowing into clean energy generation added 9 percent to US$10 billion.
Electric vehicle sales grew 38 percent last year worldwide and made up 10 percent of all transport efficiency spending. About US$6 billion was spent on electric-vehicle charging stations worldwide.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day