Black gold, i.e. oil will probably have this prestigious status for several more decades. Apparently, the era of fossil fuel, the era of oil is slowly but surely coming to an end. We are witnessing a firm step into the new era, the era of renewable energy, the era of sustainability, and the circular economy.
A digital revolution that has driven major changes in societies has enabled the development of new technologies, which have resulted in the creation of new opportunities in multiple industries. In the energy sector, new technologies further accelerated the energy transition, as they enabled the development of new solutions. That’s how everything that was just an idea became a reality. The rapid development of technologies in the energy segment is a process that takes place continuously, and this directly affected the drop in costs in this segment.
The development of technologies and continuous political features that directly support the energy transition has encouraged investors and the growth of investments in the last period is evident. In the first half of 2022 alone, investments in renewable sources in the world increased by 11%, and the value is estimated at 226 billion dollars.
The latest report of the International Energy Agency (IEA) provides new optimistic forecasts, encouraging the investing public. Namely, in the latest IEA report, it is estimated that the green energy transition will take place at an even faster pace in the next period. In the next period, that is, by the end of this decade – 2030, investments in renewable energy sources will rise to 2 trillion dollars. Compared to previous investments amounting to 1.3 trillion, it is an increase of almost 50%, which is a really optimistic and encouraging forecast.
IEA Executive Director Fatih Birol emphasized that the current trends in the energy sector are at a turning point in history.
To a large extent, energy trends are associated with the war in Ukraine. Of course, this geostrategic aspect plays a role. On the other hand, the turbulence that occurred as a result of the war caused additional support from governments for the energy transition. The administration of the European Union continuously creates policies for the promotion of green energy and the creation of greater energy independence.
Through the REPowerEU plan, the Union aims to double renewable energy capacity and completely transition away from Russian oil by 2030.
It is important to note that the United States recently allocated over 400 billion dollars for the development of clean energy projects. This trend is not absent in the Asian world. The governments of these important economies are creating a serious basis for increasing finances and improving the conditions for investing in renewable energy sources.
And the largest oil producers in the world are seriously working on their energy transition and reduction of CO2 emissions. Energy security in the future will largely depend on renewable energy, there is no doubt about that. Starting from that, the OPEC member has also committed to developing its massive hydrocarbon resources, which, thanks to their cheap and low-carbon characteristics, are considered advantageous against the more expensive and higher emissions of a world moving away from fossil fuels.