According to Bloomberg, 2021 was a record year in energy transition as the total investments worldwide stood at 755 billion dollars. “This is the year where we had COP26 in November and the EU adopting the ‘Fit for 55’ package”, noted Roxana Simon-Loeys, in the conference “Investments – private funds, public funds, support schemes”, organized by Energynomics. 2022 is expected to exceed the energy transition investments of last year, “so hold on for another year of big investments”, she said.
Renewable energy attracts most of the investments, roughly half of it, 366 billion dollars in 2021. “But the most rapidly growing sector was the electrified transport, which reached 273 billion dollars investments and grew by 77%. Its growth rate is expected to exceed the renewable energy sector in 2022”, she added.
New technologies, such as green hydrogen, carbon capture and storage, sustainable materials and energy storage, only attracted less than 5% of investment in 2021, but this is expected to change significantly in the next few years.
Roxana Simon-Loeys have been working for the EBRD for the last 10 years and is currently an independent energy consultant. She mentioned the main barriers to accelerating renewable deployment. The first barrier is the stop-and-go policy of the government. Especially in the emerging markets we need “a continuous policy to support renewables”. The next biggest challenge is the lack of grid availability. In Romania, Transelectrica and all the distribution system operators need to invest heavily in their network to be able to absorb the intermittent renewable power. “The third thing which I think is quite relevant is the bankability of the off-taker. Everyone is talking about long-term PPAs, bilateral PPAs, but it’s very difficult to find bankable off-takers for a 10-year period because it has to be not only financially credible but also willing to enter into a PPA”, said Roxana Simon-Loeys.
Last but not least, the balancing costs are an issue in Romania and in many other countries in our region, she said.
She also summarize most of the sources of equity and debts which can be used for financing energy.
The conference “Investments – private funds, public funds, support schemes” was organized by Energynomics with the support of its partners: EY and BCR.