Utilities for Net Zero Alliance pledges $116bn for clean energy and grid infrastructure
Image courtesy IRENA
The Utilities for Net Zero Alliance (UNEZA) has announced a joint intent to invest more than $116 billion per year in clean power generation and power system grid infrastructure globally in the coming years.
The 39 partners of UNEZA, which includes 32 of the largest utilities and energy companies in the world serving more than 327 million customers globally, aim to use this announcement to step up efforts to expand and modernise grid infrastructure. 48% per cent of the total investment planned and committed in the coming years targets transmission and distribution infrastructure.
The announcement was made during New York Climate Week at a roundtable in partnership with the World Trade Organization. It forms part of ongoing efforts by the Alliance and its members to signal increased demand for the equipment and materials that are essential to an expanding a cleaner power system.
Alongside investment commitments, UNEZA members published a high-level statement with recommendations to policymakers designed to alleviate supply chain constraints.
The high-level statement includes calls from industry for policymakers to harmonise standards of equipment across regions and jurisdictions creating a bigger market for common goods, promote free flow of supplies, establish forward-looking, integrated and long-term system planning including multi-project approvals and permitting, promote policy and regulatory business model innovation and maintain a healthy skills supply chain.
Have you read:
Utilities for Net Zero Alliance launched
IEA: Ten energy actions for Ukraine as winter approaches
Commenting in a release was Francesco La Camera, director-general of IRENA and host the UNEZA Secretariat: “Our top priority is to build and upgrade the grids needed to meet the global target of tripling renewable power capacity by 2030. IRENA estimates the world’s investment needs for infrastructure at $720 billion every year by 2030, the bulk will need to come from the private sector.
“Today’s commitment to invest in renewables and in power grids is a significant step towards closing the finance gap, showcasing the central role that utilities play in transforming our energy systems and realising net zero targets.”
Added co-chair and founder of UNEZA, Jasim Husain Thabet, group chief executive officer of TAQA: “This announcement shows that the utilities community is serious about the energy transition and serious about its commitment to addressing bottlenecks through cooperation and dialogue.
“If we are to collectively triple renewables capacity by 2030 in line with the COP28 outcome and achieve net zero by 2050, we need robust and resilient supply chains across the full power system value chain. Lead times for key power system equipment such as transformers, for instance, can take years – presenting a threat our ambition. The message to suppliers and policy makers is that we need partnership and farsighted strategies in this critical element of the transition.”
Alistair Phillips Davies, CEO of SSE and co-chair of the Alliance said: “A significant increase in supply chain capacity is needed if we are to deliver the clean energy transition.
“Historically, however, in many regions disjointed, short-term policy making and a narrow focus on competition have made it challenging for supply chain companies to have the long-term certainty they need to invest in building capacity.
“The tide is beginning to turn on this, with innovative approaches emerging. But we need to do more. It is therefore important for utilities to provide what certainty we can about our investment plans, while helping to inform policymakers’ journey towards a more strategic, collaborative and anticipatory approach that ensures we scale up in time to meet future demands. We are therefore delighted to be collectively sharing these important contributions in New York today.”
According to IRENA (2024), annual investment in renewable capacity must more than double grid investment between now and 2030, reaching $1,550 billion per year – compared to the $720 billion needed annually for grid infrastructure.
This increase is vital to achieve the ambitious target of tripling renewable energy capacity by 2030, marking a crucial step toward a sustainable, net-zero future.
