Energy transition technologies to soon outpace the oil market

The technologies of the energy transition are rapidly developing into an important factor in the global economy. It is already foreseeable that the previously dominant oil market will be overtaken in a few years, according to the International Energy Agency (IEA).

Rapid growth

This now has its report “Energy Technology Perspectives 2024” (ETP-2024), in which the economic impact of various technologies is analyzed. The focus is on six mass-produced clean energy technologies: photovoltaics (PV), wind turbines, electric vehicles, batteries, electrolyzers and heat pumps.

The global market for these technologies will be According to the IEA, it is expected to grow from $700 billion last year to over $2 trillion by 2035. This would be a higher value than the global oil market has almost reached in recent years. Since the oil market is likely to shrink be overhauled beforehand.

A large proportion of the goods produced in this area are installed directly in the producing countries. But cross-border trade in these technologies is also expected to more than triple in the next ten years and reach a value of $575 billion. That would be over 50 percent more than today’s global trade in natural gas.

China is moving forward

In particular, China, the European Union and the USA, and increasingly India, have made significant investments in manufacturing in recent years to strengthen their energy security and protect their economies. Despite heavy investment in the U.S., such as through the Inflation Reduction Act, China remains the dominant production location for these technologies, according to the report.

China’s clean energy technology exports are expected to reach over $340 billion by 2035. The report still sees opportunities for countries in Southeast Asia, Latin America and Africa, which currently account for less than 5 percent of production. Southeast Asia could develop into one of the cheapest locations for the production of polysilicon and wafers for solar modules. Latin America, particularly Brazil, has the potential to increase wind turbine production, while North Africa could become a hub for electric vehicle manufacturing in the coming years.