Rystad Energy research predicts that spending on low-carbon projects will increase by $60 billion this year, or 10% more than in 2022. Although infrastructure funding for hydrogen and carbon capture, utilization, and storage (CCUS) will also see a considerable increase, wind energy advancements will be a key contributor to this rise. Cost-conscious developers are tightening their purse strings after two years of increasing costs, limiting the growth in total spending from prior years, which witnessed gains of 20% a year on average.
Investments in green industries increased by 21% in 2022, surpassing corresponding oil and gas spending for the first time, but inflation-alarmed developers appear prepared to slow spending growth this year. Rystad anticipates a rebound in spending as the inflationary pressure lessens.
By 2023, investments in the geothermal, CCUS, hydrogen, hydropower, offshore and onshore wind, nuclear, and solar sectors are expected to reach $620 billion, up from roughly $560 billion in 2018. Rystad's calculations include service segments for wells, operations and maintenance, logistics and vessels, project equipment and materials, engineering and construction, and engineering.
Green Industries Investments To Increase
By a significant margin, solar and onshore wind will contribute the most. This year, $250 billion will be spent on solar investments, a 6% increase from 2022. Due to the falling price of polysilicon, the primary cost component of solar photovoltaic cells, capacity growth will be higher than suggested by dollar investments. Despite the fact that only a slight increase in investment value is anticipated, it is anticipated that installed capacity will rise to 1,250 GW by about 25%.
The rate of spending growth will vary significantly by industry. The CCUS and hydrogen industries are expected to experience the largest annual growth rates, growing by 149% and 136%, respectively. In contrast to the $7.4 billion invested in CCUS, close to $7.8 billion will be spent overall on hydrogen in 2023.
Contrarily, it is predicted that the hydropower market will shrink, while nuclear investment is forecast to remain largely flat. Investments in onshore wind are anticipated to rise by 12% to about $230 billion, while spending on offshore wind is anticipated to increase by 20% to $48 billion. Geothermal spending is anticipated to rise significantly—by about 45%—even though it will be rising from a relatively low base.
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Technology is a useful servant, but a dangerous master, it was rightly said. Electronic devices have grown into an inevitable part of our daily lives.
