Global capex spending on renewables is poised to bounce back in 2021, according to IHS Markit Energy Advisory Service.
It is expected to rise 8.5% next year to US$255bn (€205.90bn).
Annual spending is expected to remain at those levels through 2025.
This adds up to a $1.3trn (€1.05trn) cumulative 2021-2025 spend-a 9% increase over cumulative capex in 2015-2019.
At the same time, sharply declining capital costs across renewable technologies mean that just a 9% increase in spending will be associated with a 45% increase in cumulative gross renewable capacity additions in 2021-2025 vs. 2015-2019, the analysis found.
The findings are part of the new IHS Markit Energyview – Climate and Cleantech and Climate and Cleantech Advisory Briefing services.
The expected recovery follows a 2020 that saw the renewables sector hit by supply chain disruptions and construction delays stemming from COVID-19 lockdowns and mobility restrictions, among other factors.
IHS Markit expects 2020 global non-hydro renewables capex will be $235 billion (€189.71bn) down 7% from 2019 levels.
Vice President for financial services Roger Diwan said: “When it comes to renewables, we may likely look back on 2020 not so much for the COVID-induced contraction in spending but for the sprightly return to growth.
“The recovery of capital investment to pre-pandemic levels, coupled with falling costs that will give added weight to every dollar invested, is bringing renewed momentum as we head into the New Year.”