(Bloomberg) -- The race to decarbonize the world is on, and 2021 is set to break fresh records for investment and installations in renewable energy and clean technologies.
A BloombergNEF report published Tuesday showed more than $501 billion flowed into climate friendly sectors last year from renewable energy to electric vehicles and batteries to green hydrogen. All that despite the disruption caused by the pandemic.
While that pace of spending will probably continue this year, the rapid growth of clean energy stocks is likely to hit some turbulence in the months ahead. Below are just some of the predictions that BNEF analysts expect for 2021.
Wind and Solar Dominate
Investing in wind and solar proved something of a safe haven during the pandemic. As the health threat slowly recedes, installations of panels and turbines will continue to grow at pace.
New solar power installations are expected to top 150 gigawatts for the first time while wind power capacity at sea and on land will grow by 84 gigawatts. Europe and the Americas will lead the way in new wind projects, to compensate for a dip in Chinese activity.
EV Boom
The number of electric vehicles sold this year will increase by 60% compared with 2020, according to Colin McKerracher, BNEF’s head of advanced transport. That translates to 4.4 million new passenger EVs driving on the roads. The global fleet now stands at 10 million, up from 1 million six years ago. China and Europe remain the centers for growth in the sector.
LNG Bounce
The global trade of liquefied natural gas will see a boost after the Cov-19 slashed growth to just 0.9% last year. LNG trade is forecast to increase by 6% to 375 million tons, according to Fauziah Marzuki, head of LNG at BNEF.
Global LNG supply will surge 35% from 2020, driven by U.S. output, but key transit ways, such as the Panama Canal, are expected to remain congested.
Hydrogen Buzz
The hype around the potential for hydrogen produced with renewable energy exploded in 2020 as countries and businesses saw that it could be crucial in their decarbonization efforts. BNEF sees that enthusiasm as translating to the commissioning of 240 megawatts of new hydrogen electrolyzers -- up from 90 megawatts finished last year.
The European Union has said it plans to direct as much as 470 billion euros ($570 billion) toward infrastructure in the fuel in the coming decades. Other countries such as Chile, Saudi Arabia and Australia want to use hydrogen as a way to store and export power from their abundant solar and wind resources.
Continued growth in the sector will depend on government support and there are at least 12 countries looking at hydrogen strategies this year, said Martin Tengler, BNEF’s lead analyst on hydrogen.
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