Europe has to invest more than $32 trillion in energy and related technologies between now and 2050 so as to move towards a net-zero economy, as per a new BloombergNEF report.
It is well to be noted that in 2022, the region’s investment when it comes to the low-carbon transition was $227 billion. So as to hit the report’s Net Zero aspect, Europe has to elevate the annual investment in clean energy supplies, EVs, heat pumps, and sustainable materials by more than 3 times the current level across the remainder of the decade and more than 4 times when we talk of the 2030s.
As per the New Energy Outlook: Europe report from BNEF, which was released on May 15, more than two-thirds of the investment that is required happens to be on the demand side, with EVs comprising the major single portion, i.e., $21 trillion throughout 2022 to 2050, and heat pumps for $1.4 trillion. It is estimated that by 2050, Europe must go on to spend almost $3.8 trillion in order to develop an expanded as well as digitalized grid that will support EVs, heat pumps, and renewable energy integration.
A similar amount, more than $3.8 trillion, has to be invested in clean power assets by 2050 within the Net Zero gamut; a large part of it has to be before 2030.
Onshore and Offshore wind capacity will grow to almost 675 GW by the end of this decade, up from 234 GW which was witnessed in 2022. On the other hand, solar expands from 226 GW to 774 GW. Both technologies put together would go on to provide 83% of the power generation by 2050, as per the study.
As per the estimates of BNEF, in the medium term, the cheapest backup capacity mix is going to come from batteries, nuclear power plants, and gas plants with carbon capture and storage. In the longer term, the analyst firm sees a major role for green hydrogen, which will fuel the gas plants. The Net-Zero gamut also forecasts a rapid ramp-up when it comes to CCS capacity within the power sector and industries, as well as the emergence of hydrogen as far as hard-to-electrify applications are concerned.
It is estimated that by 2050, Europe will go on to invest more than $904 billion in CCS infrastructure as well as hydrogen.