To offset the impacts of the Covid-19 crisis, governments worldwide have mobilized about $17 trillion in loans, rebates, grants, and tax exemptions/ incentives as of October 2021. Most of these initiatives are largely intended to provide assistance to the public sector, businesses, and consumers who have been impacted by the economic slowdown caused by the Covid 19 pandemic, as well as to redirect public funds into rebuilding economies around the globe.
Government expenditure on clean energy has been approved at $480 billion. Renewable energy, which includes electricity, fuels and heat (advanced biofuels, biofuels, and biogas), received USD 45 billion, or nearly 9% of all announced public clean energy expenditure. The majority of the global clean energy stimulus will be spent between 2021 and 2023.
Energy efficiency has attracted USD 144 billion in global clean energy spending, owing to its potential for job development and cheap cost as a CO2 abatement approach. The most significant beneficiaries of the allocated funds are public and private building renovations, as well as energy efficiency investments in the industrial sector. Renewable heat technologies may also profit from energy efficiency spending, depending on country-level legislation.
Public transportation comes in second with $94 billion in financing, followed by low-emission automobiles and charging infrastructure ($79 billion). Railways, walking/cycling and mass/urban transit, facilities have gotten the most financing thus far, followed by EVs as well as alternative-fuel vehicles, as well as their charging infrastructure. Analysts estimate solar PV will get the highest funding for low-carbon power, accounting for over half of all low-carbon electricity spending ($24 billion), split between utility-scale as well as distributed PV.
This money will primarily be used to help already developed markets such as Korea, China, and the European Union accelerate investment. Nuclear power has received roughly USD 9 billion in government funding, with onshore wind and offshore wind coming in second and third, respectively. Dispatchable renewables, such as geothermal, hydropower, and bioenergy, received only $3 billion, despite their increasing demand for flexibility. Similarly, despite their significant contribution to the decarbonization of hard-to-abate sectors like aviation and heavy industry, biofuels and biogas only earned roughly $3 billion. Many countries see low-carbon hydrogen as the primary fuel for decarbonizing difficult-to-abate industries. This is reflected in the substantial public spending on hydrogen, which is estimated to be around USD 30 billion. However, it is unclear if this funding will go towards hydrogen produced from non-renewables or renewables.
By October 2021, Europe had received about three-quarters of all public spending on renewable energy, trailed by the Asia Pacific area and North America. Renewables, including renewable power and biofuels, accounted for 4 percent to nearly 56 percent of overall clean energy spending, depending on the location. Transport infrastructure, as well as energy efficiency spending, take precedence over renewables in Europe and North America. Focusing on achieving aggressive renewables objectives in Asia Pacific has resulted in a higher renewable percentage of overall clean energy spending, particularly in China and Korea.