Investments in renewables continue to outpace fossil fuels, a BloombergNEF report finds
2 min
Zero-carbon technologies comprised more than 40% of global electricity generation for the first time in 2023, according to a report released Tuesday from BloombergNEF.
Renewable energy sources like wind and solar made up 17% of total electricity generation, and hydroelectric and nuclear power contributed 24%. Fossil fuels including coal and natural gas produced 57% of global electricity last year.
“We’ve consistently seen the penetration of renewables rising every year, and this year we hit quite a few milestones that had felt harder to reach in past years,” said Meredith Annex, head of clean power at BNEF.
One such milestone: Solar and wind represented more than 90% of global energy capacity additions last year, a step up from 2022. Global wind capacity also crossed the one-terawatt threshold. And Brazil, the country with the cleanest power mix of the G-20 economies, hit 88% renewable power generation in 2023.
“It just shows the momentum that the space is having. A lot of that does tie into the investment story, where you’ve got rising—skyrocketing, honestly—investment into solar,” Annex said.
Mainland China accounted for almost a third of total renewable energy output last year. The country recently reached its 2030 target for wind and solar energy six years early, according to a statement from its National Energy Administration, and it has pulled back on permits for new coal-fired power plants. The country’s rapid deployment of renewables has some analysts wondering if it will reach peak fossil fuel consumption this year. Declining emissions in China would signal a turning point because it is the world’s largest polluter, comprising nearly a third of global greenhouse gas emissions, according to the International Energy Agency.
Despite rapid growth in renewables, countries’ current commitments aren’t sufficient to limit global warming to 1.5 degrees Celsius, the goal outlined in the 2015 Paris Agreement, according to the IEA. Advanced economies would need to slash emissions by 80% by 2035 to meet the goal.
At last December’s COP28, a global climate conference hosted by the United Nations, participating countries agreed to triple renewable energy capacity by 2030. BNEF has forecast that achieving this goal would require investments in renewables to increase to 1.6 times 2023 levels from 2024 to 2030.
So far, that increase hasn’t materialised. Global investments in renewables are roughly on par with 2023 levels, at $313 billion in the first half of 2024, according to the new BNEF analysis. “We’re expecting steady growth, but steady growth does not get you to net zero,” Annex said.
The topline numbers obscure bigger changes under the surface. Average spending in the U.S. is up by about 63% compared with levels before the 2022 Inflation Reduction Act, which offers generous subsidies and tax breaks to promote decarbonisation. And while Chinese investment is actually down 4% from the same period in 2023, Annex said the dip is due to cheaper equipment for wind and solar, not a decline in demand.
The second half of this year will be a “defining moment,” for the investment landscape, Annex said. Steady growth “is definitely a positive, and it could be a sign that the industry as a whole is reaching a new kind of status quo, but we need to help expand even faster if we’re going to be in line with net zero.”
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Selloff in bitcoin and other digital tokens hits crypto-treasury companies.
3 min
The hottest crypto trade has turned cold. Some investors are saying “told you so,” while others are doubling down.
It was the move to make for much of the year: Sell shares or borrow money, then plough the cash into bitcoin, ether and other cryptocurrencies. Investors bid up shares of these “crypto-treasury” companies, seeing them as a way to turbocharge wagers on the volatile crypto market.
Michael Saylor pioneered the move in 2020 when he transformed a tiny software company, then called MicroStrategy , into a bitcoin whale now known as Strategy. But with bitcoin and ether prices now tumbling, so are shares in Strategy and its copycats. Strategy was worth around $128 billion at its peak in July; it is now worth about $70 billion.
The selloff is hitting big-name investors, including Peter Thiel, the famed venture capitalist who has backed multiple crypto-treasury companies, as well as individuals who followed evangelists into these stocks.
Saylor, for his part, has remained characteristically bullish, taking to social media to declare that bitcoin is on sale. Sceptics have been anticipating the pullback, given that crypto treasuries often trade at a premium to the underlying value of the tokens they hold.
“The whole concept makes no sense to me. You are just paying $2 for a one-dollar bill,” said Brent Donnelly, president of Spectra Markets. “Eventually those premiums will compress.”
When they first appeared, crypto-treasury companies also gave institutional investors who previously couldn’t easily access crypto a way to invest. Crypto exchange-traded funds that became available over the past two years now offer the same solution.
BitMine Immersion Technologies , a big ether-treasury company backed by Thiel and run by veteran Wall Street strategist Tom Lee , is down more than 30% over the past month.
ETHZilla , which transformed itself from a biotech company to an ether treasury and counts Thiel as an investor, is down 23% in a month.
Crypto prices rallied for much of the year, driven by the crypto-friendly Trump administration. The frenzy around crypto treasuries further boosted token prices. But the bullish run abruptly ended on Oct. 10, when President Trump’s surprise tariff announcement against China triggered a selloff.
A record-long government shutdown and uncertainty surrounding Federal Reserve monetary policy also have weighed on prices.
Bitcoin prices have fallen 15% in the past month. Strategy is off 26% over that same period, while Matthew Tuttle’s related ETF—MSTU—which aims for a return that is twice that of Strategy, has fallen 50%.
“Digital asset treasury companies are basically leveraged crypto assets, so when crypto falls, they will fall more,” Tuttle said. “Bitcoin has shown that it’s not going anywhere and that you get rewarded for buying the dips.”
At least one big-name investor is adjusting his portfolio after the tumble of these shares. Jim Chanos , who closed his hedge funds in 2023 but still trades his own money and advises clients, had been shorting Strategy and buying bitcoin, arguing that it made little sense for investors to pay up for Saylor’s company when they can buy bitcoin on their own. On Friday, he told clients it was time to unwind that trade.
Crypto-treasury stocks remain overpriced, he said in an interview on Sunday, partly because their shares retain a higher value than the crypto these companies hold, but the levels are no longer exorbitant. “The thesis has largely played out,” he wrote to clients.
Many of the companies that raised cash to buy cryptocurrencies are unlikely to face short-term crises as long as their crypto holdings retain value. Some have raised so much money that they are still sitting on a lot of cash they can use to buy crypto at lower prices or even acquire rivals.
But companies facing losses will find it challenging to sell new shares to buy more cryptocurrencies, analysts say, potentially putting pressure on crypto prices while raising questions about the business models of these companies.
“A lot of them are stuck,” said Matt Cole, the chief executive officer of Strive, a bitcoin-treasury company. Strive raised money earlier this year to buy bitcoin at an average price more than 10% above its current level.
Strive’s shares have tumbled 28% in the past month. He said Strive is well-positioned to “ride out the volatility” because it recently raised money with preferred shares instead of debt.
Cole Grinde, a 29-year-old investor in Seattle, purchased about $100,000 worth of BitMine at about $45 a share when it started stockpiling ether earlier this year. He has lost about $10,000 on the investment so far.
Nonetheless, Grinde, a beverage-industry salesman, says he’s increasing his stake. He sells BitMine options to help offset losses. He attributes his conviction in the company to the growing popularity of the Ethereum blockchain—the network that issues the ether token—and Lee’s influence.
“I think his network and his pizzazz have helped the stock skyrocket since he took over,” he said of Lee, who spent 15 years at JPMorgan Chase, is a managing partner at Fundstrat Global Advisors and a frequent business-television commentator.
