Industry

The global energy industry will spend $2.1 trillion in 2022

According to a study by rystad energy, a business intelligence firm, the global energy industry is expected to spend $2.1 trillion (1.92 trillion euros) by 2022, mainly investing in oil and natural gas, including renewable energy and hydrogen.

Although the war in Ukraine is expected to disrupt the energy transformation, investment in renewable energy has increased the fastest, accounting for 31% of total energy expenditure. Rystad Energy said that without war, the share of green spending would increase slightly.

Green energy investment will increase by 24% year-on-year, or US $125 billion, of which solar energy investment will increase by 64%. Other green industries that will increase spending in 2022 include onshore wind energy (24% year-on-year growth), geothermal (38% year-on-year growth), hydrogen (37% year-on-year growth), carbon capture and storage (54% year-on-year growth) and batteries (29% year-on-year growth). According to rystad energy, offshore wind power investment is expected to decline by 15%.

In contrast, upstream oil and gas spending is expected to rise 16% year-on-year, or $142 billion, rystad Energy said.

Global inflation, labor costs and shipping prices caused by the new crown pandemic and sanctions against Russia have led to record energy spending. According to rystad energy, the rise in steel prices has pushed up the cost of oil and gas projects by 10% to 20% from the level in 2020. Over the same period, lithium, nickel, copper and polysilicon, key materials in the battery and solar photovoltaic manufacturing industry, increased the cost of renewable energy projects by 10% to 35%.

"The world is currently spending more on energy than ever before. 2014 was the last time we saw similar figures. One can see a significant shift in spending on green energy, which has been increasing while spending on oil and gas has been decreasing. However, spending on other fossil fuels such as coal has remained unchanged.