BRUSSELS — The ambitious renewable energy targets set at last year’s global climate summit will not be achieved unless the world ramps up its investment by more than $30 trillion over the next six years, according to the International Renewable Energy Agency (IRENA).
In a stark warning issued Friday, IRENA shared its findings during the final ministerial meeting before next month’s COP29 climate summit in Azerbaijan, where climate finance will be a central topic.
At the COP28 summit in Dubai, countries committed to tripling global renewable energy capacity and doubling energy efficiency efforts by 2030. These promises were seen as crucial for limiting global warming in line with the Paris Agreement. However, IRENA’s first progress report paints a grim picture: the world is falling far short of these targets.
The agency’s report found that countries are currently on track for only half of the renewable energy growth needed to meet the tripling target. To close this gap, IRENA emphasized the need for stronger policies, streamlined permitting processes, modernized power grids, and most critically, a significant surge in investment.
Last year, global investment in renewable energy reached a record $570 billion. But IRENA says the world needs to spend $1.5 trillion per year to hit its goals. Additionally, spending on energy efficiency measures must increase seven-fold, rising from $323 million in 2022 to $2.2 trillion annually by 2030.
In total, achieving the twin goals set at COP28 will require a staggering $31.5 trillion investment in renewable energy, power grids, energy efficiency, and related measures by the end of the decade, according to IRENA’s analysis.
The report is likely to strengthen the calls from developing nations for a substantial increase in financial support. With COP29 just a month away, countries are expected to negotiate a new collective financial target to help fund climate action—particularly the shift from fossil fuels to renewable energy—in developing nations.
Some proposals for replacing the current annual target of $100 billion suggest increasing it to as much as $1.3 trillion. However, developed nations and the European Union argue that any major increase in public finance should require contributions from emerging economies like China. They also stress that the majority of investment should come from the private sector rather than national budgets. IRENA advocates for a “major scale-up” of both public and private sector financing, particularly in developing countries.
Currently, the vast majority of renewable energy investments—84 percent—are concentrated in the European Union, China, and the United States. India and Brazil account for about 6 percent, while investments in Africa remain extremely low, halving between 2022 and 2023.
IRENA’s report also highlights the lack of progress in most areas of renewable energy development, with solar power being the exception. To reach the COP28 target of tripling renewable energy capacity, global installed renewables would need to jump from the current 3.9 terawatts (TW) to 11.2 TW by 2030. However, current national commitments are projected to add just 3.5 TW, reaching 7.4 TW by the end of the decade.
Plans submitted by countries under the Paris Agreement, known as Nationally Determined Contributions (NDCs), show an even bleaker outlook, predicting only 5.4 TW of renewable capacity by 2030. IRENA stressed that next year’s NDC updates will need to “more than double” their renewables targets.
While solar energy is on track, other technologies lag behind. Onshore wind capacity needs to triple, and offshore wind and bioenergy must grow six times faster. Geothermal energy development is particularly slow, requiring a 35-fold increase in growth to meet its projected contribution.
Progress on energy efficiency is similarly lacking. IRENA pointed to key measures like retrofitting old buildings and increasing electrification through electric vehicles (EVs) and heat pumps, which use less energy than fossil fuel alternatives.
EV sales reached a record 18 percent of global car sales last year, but heat pump sales tell a different story. After a surge in 2022, global heat pump sales dropped by 3 percent in 2023, with the sharpest decline seen in Europe.
As the COP29 summit approaches, IRENA’s report sends a clear message: without urgent action and massive financial investment, the world will miss its renewable energy goals—and with them, the chance to meet climate commitments.
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