• In a report called Carbonomics, investment bank Goldman Sachs concludes that investment in renewables will take a huge leap this decade.
  • As soon as 2021, renewable energy will capture more investment than oil and gas.
  • Renewables could see $16 trillion in investment through 2030.

Global investment in renewable energy is set to surpass oil and gas for the first time ever next year, according to a new report.  Trillions of dollars are slated to pour into wind, solar, batteries, EVs and green infrastructure in the coming decade. “[W]e estimate that clean tech can drive US$1-2 [trillion per year] of green infrastructure investments and create 15-20 [million] jobs worldwide,” Goldman Sachs said in a lengthy new report it calls “Carbonomics.”

As soon as 2021, renewable energy will capture more investment than oil and gas, and renewables could see $16 trillion in investment through 2030, according to Goldman Sachs. That would keep the world on track to avoid more than 2 degrees Celsius of warming, although regulatory and policy changes are still necessary for this scenario to play out.

The timing of the change is important. Goldman says that a wave of clean tech investment “has a major role to play in the upcoming economic recovery,” noting that green infrastructure is 1.5 to 3 times more capital- and job-intensive than fossil fuels. It is a “strong example of pro-growth pro-environment public-private collaboration,” Goldman analysts wrote. Every 1 euro spent on renewables translates into 1-10 euros of GDP growth, Goldman said, citing data from IRENA.

While there are calls for a Green New Deal in the U.S. and similar versions in Europe, investors are also participating in and driving some of the shift. That will increasingly be the case as the cost of renewables continues to decline and the investment case in oil and gas continues to sour. “[F]inancial conditions keep tightening for long-term hydrocarbon developments, creating higher barriers to entry, lower activity, and ultimately lower oil & gas supply in our view,” the investment bank said.