The International Energy Agency (IEA) has said governments worldwide had earmarked $470 billion as of October 2021 to clean energy measures as part of their economic response to the Covid-19 crisis, an increase of $90 billion when compared to the previous quarter’s numbers.

The spending on clean energy is part of the $16 trillion planned by governments in fiscal support to stabilize economies following the pandemic.

In its ‘Sustainable Recovery Tracker,’ IEA said that most clean energy mobilization comes from an updated assessment of subsidies for renewables, electric vehicles, and energy efficiency retrofits. Long-term-oriented economic recovery spending directed at long-term investments remained at around $2.3 trillion.

Several countries are still crafting and approving new spending programs that would include substantial clean energy provisions. In these under-deliberation spending packages, nations could see significant portions earmarked for clean energy. The spending provides energy efficiency of buildings, renewable electricity generation and power grids, clean transport, and innovation hydrogen technologies and carbon capture, utilization, and storage. These measures could bring advanced economies, which already represent the bulk of global recovery spending directed towards clean energy, quite close to the levels envisioned in the sustainable recovery plan, IEA said.

Government spending rose substantially in energy efficiency, clean fuels innovation funding, and low-carbon and efficient transport, adding to strong government support for these areas.

However, mobilizing the additional investment is dependent on the bulk of government spending reaching market actors in the crucial 2021-2023 recovery period. Long lead times for project development and lags in implementation could significantly delay the impact on the real economy.

The Sustainable Recovery Tracker said advanced economies continue to lead in clean energy spending by governments, reaching nearly two-thirds of the levels envisioned for economic recovery. New infrastructure spending packages under consideration in France, Japan, and the United States could substantially increase clean energy investment figures in advanced economies further and bring them close to the levels recommended in the Sustainable Recovery Plan. However, further investments in advanced economies will be needed over the rest of this decade to put them on a path consistent with reaching net zero emissions from energy globally by 2050.

In contrast, in emerging and developing economies, government spending remains only around one-tenth of the level seen in advanced economies. Apart from India’s Gati Shakti infrastructure plan, no notable new spending plans with clean energy provisions are in the works in emerging and developing economies, which currently face the challenges of slower economic recovery and limited fiscal leeway.

Earlier, in its ‘World Energy Investment 2021’, IEA found that annual global energy investment will rise to $1.9 trillion in the current year, rebounding nearly 10% from 2020 and bringing the total volume of investments back towards pre-pandemic levels.

In its ‘Renewables 2020′ report, IEA said India would be the most significant contributor to the renewable upswing in 2021. The country’s annual additions are expected to double in 2021 compared to 2020.