The global market for key mass-manufactured clean energy technology will be worth about $650 billion a year by 2030, more than three times the current level, if countries worldwide fully enact energy and climate pledges, according to the International Energy Agency.
The related clean energy manufacturing jobs will more than double to 14 million by the end of this decade from the current six million, the agency said in its Energy Technology Perspectives 2023 report on Thursday.
“We’re talking about new clean energy technology markets worth hundreds of billions of dollars as well as millions of new jobs,” said the agency's executive director, Fatih Birol.
“If everything announced as of today gets built, the investment flowing into manufacturing clean energy technologies would provide two thirds of what is needed in a pathway to net-zero emissions.
“The current momentum is moving us closer to meeting our international energy and climate goals — and there is almost certainly more to come.”
However, the high concentration of resources and technology in certain countries poses risks to global supply chains, the report said.
Over the past two years, lockdowns in China, the world’s second-largest economy and top manufacturer of solar modules, have resulted in major supply chain disruptions around the world.
The Asian country is forecast to invest $90 billion in its solar photovoltaic supply chain between 2022 and 2027, more than triple the investment expected from the rest of the world combined, the agency said in a report last year.
“The world is already seeing the risks of tight supply chains, which have pushed up clean energy technology prices in recent years, making countries’ clean energy transitions more difficult and costly,” said the agency.
Electric vehicles — seen as crucial to global net-zero efforts — rely on a range of critical minerals, which are sourced from a handful of countries such as the Democratic Republic of Congo, Australia and China.
“The world would benefit from more diversified clean technology supply chains,” said Mr Birol.
“As we have seen with Europe’s reliance on Russian gas, when you depend too much on one company, one country or one trade route — you risk paying a heavy price if there is disruption.”
Major economies are acting to combine their climate, energy security and industrial policies into broader strategies, the report said.
The US Inflation Reduction Act offers a series of tax incentives on wind, solar, hydropower and other renewables as well as a push towards electric vehicle ownership.
In May, the EU launched the REPowerEU plan, which comprises measures to tackle the energy crisis caused by Russia's invasion of Ukraine.
With the help of the programme, the bloc plans to reduce demand for Russian gas by two thirds before the end of the year, with a mobilisation of up to €300 billion ($323 billion) in investments.
Only 25 per cent of the announced manufacturing projects globally for solar PV are under construction or beginning construction imminently, the agency said.
The number is about 35 per cent for EV batteries and less than 10 per cent for electrolysers, a critical technology used for the production of low-emission hydrogen.