Procurement Strategies Driven by Cleantech Investment Surge
In a groundbreaking shift for the energy sector, S&P Global Commodity Insights has released a report predicting that cleantech investments will surpass fossil fuel spending for the first time in 2025.
The development signals a transformation in the global energy landscape, with significant implications for procurement strategies across industries.
Record-breaking cleantech investments
The report forecasts an unprecedented surge in cleantech energy supply investments, reaching US$670bn in 2025.
Edurne Zoco, Executive Director of Clean Energy Technology at S&P Global Commodity Insights, states: "S&P Global Commodity Insights forecasts that cleantech energy supply investments, including renewable power generation, green hydrogen production and carbon capture and storage (CCS), will reach US$670 billion in 2025, marking the first time these investments will outpace projected upstream oil and gas spending.
"Solar PV is expected to represent half of all cleantech investments and two-thirds of installed megawatts."
Procurement challenges and opportunities
Supply chain tensions
The cleantech sector faces supply chain challenges, particularly due to an oversupply of equipment from China. Procurement professionals should be aware that while price declines may stabilise in 2025, competition from Chinese manufacturers is expected to keep prices low.
The situation presents both opportunities and risks for buyers in the cleantech market.
Energy storage integration
Battery energy storage is becoming crucial for project economics in regions with high renewable energy penetration. Procurement strategies should consider the integration of battery storage solutions to enhance the viability of renewable energy projects and mitigate risks associated with price fluctuations.
AI and data centres: Driving clean energy procurement
The report highlights the growing influence of AI in the cleantech sector.
Procurement professionals should be aware of AI-powered trading applications emerging as critical tools for risk mitigation and energy management.
Meanwhile, data centres are expected to play a significant role in corporate clean energy procurement.
The report states: "Data centres are expected to significantly increase their role in corporate clean energy procurement, with expectations to source approximately 300 TWh of clean power annually by 2030."
The trend presents new opportunities for procurement strategies in the tech sector and beyond.
Decarbonisation and market dynamics
Eduard Sala de Vedruna, Head of Research, Energy Transition, Sustainability & Services at S&P Global Commodity Insights, highlights the pivotal nature of 2025 for the clean energy sector.
He adds: "The new year 2025 is not only bringing to the clean energy sector significant transformations that are reshaping energy production and consumption, but it promises to be pivotal for the clean energy sector, with significant advancements in corporate clean energy procurement and the integration of AI in energy management."
As the energy landscape evolves, procurement professionals must stay informed about emerging technologies and market dynamics.
The quest for deeper decarbonisation, including advancements in low-carbon hydrogen production and carbon capture technologies, will likely influence procurement decisions across various industries.
In conclusion, the projected shift towards cleantech investments in 2025 marks a significant turning point for global energy procurement.
As the sector continues to evolve, staying ahead of these trends will be crucial for organisations looking to optimise their energy strategies and contribute to sustainability goals.
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