The energy world is at the dawn of the new industrial age – the age of clean energy technologies manufacturing – that is creating major new markets and millions of jobs but also raising new risks, prompting countries across the globe to devise commercial strategies to secure their place in the new global energy economy, according to a major new IEA report.
Energy Technology Perspectives 2023 , the latest instalment in one of the particular IEA’s flagship series, serves as the world’s first global guidebook for the particular clean technology industries of the future. It provides a comprehensive analysis of global manufacturing associated with clean power technologies today – such as solar panels, wind turbines, EV batteries, electrolysers for hydrogen and heat pumps – and their supply chains around the world, as well because mapping out how they are likely to evolve as the clean energy transition advances in the years ahead.
The analysis shows the global market for key mass-manufactured thoroughly clean energy technologies will be worth around USD 650 billion a year by 2030 – more than three times today’s level – if nations worldwide fully implement their own announced power and climate pledges. The particular related clean energy manufacturing jobs would more than double from 6 million today in order to nearly 14 million simply by 2030 – and further rapid industrial plus employment growth is expected within the following decades since transitions progress.
At the same time, the particular current supply chains of clean energy technologies present risks in the form of high geographic concentrations associated with resource mining and processing as well as technologies manufacturing. For technologies like solar sections, wind, ELECTRONIC VEHICLES batteries, electrolysers and warmth pumps, the three largest producer countries account for at least 70% of production capacity for each technology – with China dominant in all of them. Meanwhile, a great deal of the exploration for critical minerals is concentrated in the small number of countries. For example , the Democratic Republic of Congo produces over 70% of the particular world’s cobalt, and just 3 countries – Australia, Chile and The far east – account for a lot more than 90% associated with global lithium production.
The entire world is already seeing the dangers of tight supply stores, which have pushed up thoroughly clean energy technology prices within recent many years, making countries’ clean power transitions more difficult and costly. Increasing prices with regard to cobalt, li (symbol) and nickel led to the first ever rise in EV battery prices, which jumped by nearly 10% globally in 2022. The cost of wind turbines outside China has also been rising after years of declines, plus similar trends can be seen in solar PV.
“The IEA highlighted almost two years ago that a new worldwide energy economy was emerging rapidly. Today, it has become a central pillar associated with economic strategy and every country needs to identify how it can benefit from the opportunities and navigate the particular challenges. We’re talking about brand new clean energy technology markets worth hundreds of billions of dollars as well as millions of new work, ” said IEA Executive Director Fatih Birol. “The encouraging news is the global project pipeline for clean energy technologies manufacturing is large plus growing. If everything announced as of today gets built, the investment flowing into manufacturing clean power technologies might provide two-thirds of what is needed in a pathway in order to net zero emissions. The current momentum will be moving us closer to meeting our international energy and climate goals – plus there is almost certainly a lot more to come. ”
“At the same time, the particular world would certainly benefit through more diversified clean technology supply chains, ” Dr Birol added. “As we have seen with Europe’s reliance on Russian gas, when you depend too much on one company, 1 country or one trade route – you risk paying a heavy price if there is disruption. So , I’m pleased to see many economies all over the world competing nowadays to be leaders within the new energy economy and drive an expansion of thoroughly clean technology production in the race to net zero. It’s important, though, that this competition is fair – and that there is usually a healthy degree associated with international collaboration, since no country is definitely an energy island and energy transitions will become more costly and slow if nations do not work together. ”
The report notes that will major economies are acting to combine their particular climate, power security plus industrial policies into broader strategies for their economies. The Inflation Reduction Act in the United States is a clear example of this, but there can be also the particular Fit regarding 55 package and REPowerEU plan in the European Union, Japan’s Green Transformation programme, and the Production Linked Incentive scheme within India that encourages manufacturing of solar PV and batteries – and China is working in order to meet plus even exceed the objectives of its latest Five-Year Plan.
Meanwhile, clean energy project developers and investors are watching closely intended for the guidelines that can give them the competitive edge. Relatively short lead times of around 1-3 yrs on average to bring production facilities online mean that will the project pipeline may expand rapidly in an environment which is conducive to investment. Only 25% of the introduced manufacturing projects globally to get solar PV are under construction or even beginning construction imminently, according to the report. The number is around 35% for ELECTRONIC VEHICLES batteries and less compared to 10% pertaining to electrolysers. Government policies plus market developments can have a significant effect on where the rest of these tasks end up.
Amid the regional ambitions meant for scaling upward manufacturing, ETP-2023 underscores the important role of worldwide trade in clean power technology provide chains. It shows that nearly 60% of photo voltaic PV modules produced worldwide are traded across borders. Trade is also important designed for EV batteries and blowing wind turbine components, despite their own bulkiness, with China the main net exporter today.
The statement also highlights the specific challenges related to the particular critical minerals needed just for many clean energy technologies, noting the long lead times for developing brand new mines and the need for strong environmental, social plus governance standards. Given the particular uneven geographic distribution of critical mineral resources, global collaboration and strategic partnerships will end up being crucial with regard to ensuring security of supply.