The UNEP report published yesterday shows that during 2008, the economic crisis hit EU and US clean energy the hardest, while renewables investments in emerging economies rose by 27% to $36 billion. Renewables attracted more investment than fossil-fuelled energy technologies during 2008, with geothermal experiencing the fastest growth (149% rise with 1.3 GW of new capacity installed), wind power the most investment ($51.8 billion, 1% growth on 2007), and solar energy the largest gains ($33.5 billion, 49% growth).
New Energy Finance calculates that $155 billion was invested in 2008 in clean energy companies and projects worldwide—not including large hydro. Of this, $13.5 billion of new private investment went into companies developing and scaling up new technologies, alongside $117 billion of investment in renewable energy projects from geothermal and wind to solar and biofuels.
Although extremely difficult financial market conditions during 2008 have constrained investments in clean energy development, the amount invested in 2008 is more than a four-fold increase since 2004. Achim Steiner, UN Under-Secretary General and UNEP Executive Director, said: “Without doubt the economic crisis has taken its toll on investments in clean energy when set against the record-breaking growth of recent years. Investment in the
“Meanwhile other developing economies such as
Of the $155 billion total worldwide investment, $105 billion was spent directly developing 40 GW of power generating capacity from wind, solar, small-hydro, biomass and geothermal sources, while a further $35 billion was spent on developing 25 GW of large hydropower. This $140 billion investment in 65 GW of low carbon electricity generation compares with the estimated $250 billion spent globally in 2008 constructing 157 GW of new power generating capacity from all sources. Consequently, renewables currently account for the majority of investment and over 40% of actual power generation capacity additions last year.
Solar PV prices set to plummet
The investment surge of recent years and softened commodity markets have started to ease supply chain bottlenecks, especially in the wind and solar sectors, which will cause prices to fall towards marginal costs and several players to consolidate. The price of solar PV modules, for example, is predicted to fall by over 43% in 2009.
Carbon markets buoyant
Despite the turmoil in the world’s financial markets, transaction value in the global carbon market grew 87% during 2008, reaching a total of $120 billion. Following the lead of the EU and
Growth shifts to the developing world
With developed country market growth stalled (down 1.7%), developing countries surged forward, accounting for nearly one third of global investments in clean energy technologies.
Investment in
Europe continues to dominate sustainable energy new investment with $49.7 billion in 2008, an increase of 2% on 2007 (37% CAGR from 2006-2008).This investment is underpinned by government policies supporting new sustainable energy projects, particularly in countries such as Spain, which saw $17.4 billion of asset finance investment in 2008.
By 2008,
About 46% of
Commenting on the release of a similar report (REN21 Renewables Global Status Report) last month, REN21’s chairman, Mohamed El-Ashry, said: “This fourth edition of REN21’s renewable energy report comes in the midst of an historic and global economic crisis. Although the future is unclear, there is much in the report for optimism.” The same could be said of the findings presented above.
