A multi-trillion dollar showdown over energy’s future
energy transition over the next decade isn’t technology or politics. It’s money.
Reconfiguring the world’s power systems to eliminate carbon emissions is going to be a multi-trillion dollar investment project.
Over the past few years, clean energy has overtaken fossil fuels in terms of global spending, but one place is still falling short: developing economies. Rich nations tempted to rest on their laurels, now that a promise to mobilise $100 billion a year for climate in such countries appears to have finally been met, should watch out.
The real fight is just beginning.
That’s because the world’s fossil fuel exporters aren’t about to take the challenge lying down. At stake are the energy policies of 10 emerging countries in Asia and Africa that will account for more than half the world’s additional population between now and 2050, and a concomitant share of its energy.
They have economies highly dependent on foreign capital, either because of their rapid pace of development, or the fragility of their currencies. If rich nations don’t provide the funding for clean energy to fuel their growth, oil producers and their allies stand with checkbooks at the ready for the dirty alternative.
Flush with profits from high oil prices, Gulf monarchies — in particular Saudi Arabia and the United Arab Emirates — have been busy building ties.
Billions have been deposited with the central banks of Egypt and Pakistan to stabilise their currencies as energy import bills rose in the wake of the Ukraine war, an unusual move that leaves the recipients deeply in hock to donors. Saudi businesses signed $4.3 billion of deals with Philippine counterparts at an investment forum in October, plus a contract this month to run a new container port
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