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Friday, March 19, 2021
Capital expenditure for renewable energy projects is set for a new record in 2021, a Rystad Energy analysis shows, forecast to reach $243 billion, and narrowing the gap with oil and gas spending, which is projected to be relatively flat this year at $311 billion. While oilfield service suppliers have taken considerable steps to make structural changes and diversify, 2020’s financial results suggest more needs to be done.
Renewables capex, which equals purchases from supply firms, is set for another record year, picking up where last year left off, when spending hit $224 billion. By contrast, oil and gas capex this year is expected to stay in line with 2020’s $306 billion – a far cry from the industry’s better days, as just in 2019 E&Ps splurged $422 billion on supply purchases.
The spending gap between renewable energy and oil and gas is closing, as capex for renewables is now just 22% below the estimate for upstream projects. Most of the renewable energy spending will go towards onshore wind projects, rising to $100 billion from $94 billion in 2020. Solar PV spending is expected to climb to $96 billion this year from $88 billion last year, while offshore wind will see capex grow to $46 billion from $43 billion.
For the full release, visit Rystad Energy here.
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