Clean and renewable investments reached US$211bn in 2010

By Renewable Energy Focus staff

Investment in large-scale renewable energy was led by China and developing economies as those countries overtake the ‘developed’ world in terms of financial new investment at the utility-scale.

Developing countries invested US$72bn whereas the developed world invested ‘only’ US$70bn, according to the report Global Trends in Renewable Energy Investment 2011 by Bloomberg New Energy Finance, commissioned by UNEP.

Developing economies:

  • China: US$48.9bn, +28%
  • South and Central America: US13.1bn, +39%
  • Middle East and Africa: US$5bn, +104%
  • India: US$3.8bn, +25%
  • Asian developing countries (excl. China and India): US$4bn, +31%

Government renewable energy research and development investment reached US$5bn, increasing over 120%.

Europe saved by small-scale installations

Europe, however, saw a 22% decline to US$35.2bn in new financial investment in large-scale renewable energy in 2010. Small scale projects on the other hand, saw a surge – especially in rooftop solar photovoltaics (PV).

Small, distributed renewable energy capacity:

  • Germany: US$34bn, +132%
  • Italy: US$5.5bn, +59%
  • France: US$2.7bn, +150%
  • Czech Republic: US$2.3bn, +163%

Part of the reason for the surge in small-scale installations, is the 60% drop in solar PV module prices from mid-2008.

European feed-in tariff cuts

European figures were also hit by the cuts in feed-in tariffs announced towards the end of 2010.

Spain and the Czech Republic moved to make retroactive cuts in feed-in tariff levels for already operating projects at the end of 2010, which caused damage to renewable energy investors’ confidence.

Germany and Italy also announced cuts, but only for new projects.

Despite cuts, the solar PV market is expected to remain strong in 2011.

By technology

Over the last two years, the prices for wind turbines have fallen 18% per MW, UNEP says. Wind saw investments of US%94.7bn, up 30% over 2009. In comparison, solar including small-scale reached US$86bn (+52%), biomass and waste-to-energy US$11bn, whereas biofuels dropped from its US$20.4bn high in 2006, to just US$5.5bn.

The biggest jumps in overall investment were in small-scale renewable energy projects, which reached US$60bn, up 91%; and government-funded research and development, which rose 121% to US$5.3bn.

Corporate research and development into renewable energy, however, fell 12% to US$3.3bn and provisions of expansion capital for renewable energy companies by private equity funds were down 1% to US$3.1bn.

Falling share prices

Clean energy share prices fell within the WilderHill New Energy Global Innovation Index (NEX) by 14.6% – underperforming wider stock market indices by more than 20%.

Furthermore, acquisition activity fell from US$66bn in 2009 to US$58bn. The two largest categories of merger and acquisition activity – corporate takeovers and acquisitions of wind farms and other asset – fell around 10%.