Global Trends in Sustainable Energy investment 2009
$155 billion was invested in 2008 in clean energy companies and projects worldwide - not including large hydro, a new report launched today says. 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. The report (Global Trends in Sustainable Energy investment 2009) notes extremely difficult financial market conditions prevailed during 2008 as a result of the global economic crisis. Nevertheless investment in clean energy topped 2007’s record investments by 5% in large part as a result of China, Brazil and other emerging economies.
Of the $155 billion, $105 billion was spent directly developing 40 GW of power generating capacity from wind, solar, small-hydro, biomass and geothermal sources. A further $35 billion was spent on developing 25 GW of large hydropower, according to the report.
This $140 billion investment in 65 GW of low carbon electricity generation compares with the estimated $250 billion spent globally in 2008 constructing 157GW of new power generating capacity from all sources. It means that renewables currently account for the majority of investment and over 40% of actual power generation capacity additions last year.
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 United States fell by two per cent and in Europe growth was very much muted. However, there were also some bright points in 2008 especially in developing economies-China became the world’s second largest wind market in terms of new capacity and the world’s biggest photovoltaic manufacturer and a rise in geothermal energy may be getting underway in countries from Australia to Japan and Kenya”.
Overall Highlights from the Report
- Wind attracted the highest new investment ($51.8 billion, 1% growth on 2007), although solar made the largest gains ($33.5 billion, 49% growth) while biofuels dropped somewhat ($16.9 billion, 9% decrease).
- Total transaction value in the sustainable energy sector during 2008 - including corporate acquisitions, asset re-financings and private equity buy-outs - was $223 billion, an increase of 7% over 2007. But capital raised via the public stock markets fell 51% to $11.4 billion as clean energy share prices lost 61% of their value during 2008.
- Investment in the second half of 2008 was down 17% on the first half, and down 23% on the final six months of 2007, a trend that has continued into 2009.
One response to the global economic crisis has been announcements of stimulus packages with specific, multi-billion dollar provisions for energy efficiency up to boosts to renewable energies. “These ’green new deals’ lined up by some economies, including China, Japan, the Republic of Korea, European countries and the United States contain some serious clean energy provisions. These will help support the market,” said Mr. Steiner.
“However, the biggest renewables stimulus package of them all can come at the UN climate convention meeting in Copenhagen in just over 180 days time. This is where governments need to Seal the Deal on a new climate agreement-one that can bring certainty to the carbon markets, one that can unleash transformative investments in lean and clean green tech,” he added.
