Events of the past week confirmed three trends that are evident in the renewable energy industry in 2011. They are the growth in investment in generation capacity in Asia outside China, the expansion of manufacturing activity in Asia, and the benefit that developed countries like the US are getting.

Looking at the project development side first, India will invest USD 6.5bn in building some 3.5GW of clean energy projects in the current financial year ending March, the minister for renewable energy announced in Parliament last week. The comparable number last year was less than USD 5bn.

South Asia’s largest economy is already adding over 2GW of wind annually. A federal-level National Solar Mission aims to add 1.3GW of solar capacity by 2013. Project developers are also being invited by various states. Bloomberg New Energy Finance has estimated that there is a pipeline of 1.9GW of solar projects in various stages of development.

Investment in wind projects in neighbouring Pakistan is gathering pace even as the country gets ready to announce feed-in-tariffs. Japan’s legislation for such preferential tariffs for biomass, geothermal, small hydro, solar and wind was approved last week and pay-outs are slated to begin in July 2012. Countries like Malaysia and Philippines have already announced the rules for feed-in-tariffs and are slated to begin accepting project proposals shortly.

Following actual and planned investments in generation capacity in Asia is activity by manufacturers, who want to have operations close to the demand source, and also to benefit from lower costs. Germany’s SMA Solar – which makes inverters – is planning a manufacturing base in Asia, it said earlier this week.

Norway’s Renewable Energy Corporation extended a shutdown of its plants in its home country last week because demand for wafers and cells have failed to pick up. However, it is working to full-capacity at its silicon production unit in the US and its wafer, cell and module production lines in Singapore.

The developed world is getting some benefit from these Asian production lines. According to the US Solar Energy Industries Association, exports of solar products were up 83% to USD 5.63bn in 2010 as increasing production in China increased sales of manufacturing equipment and raw materials. Polysilicon producers like MEMC Electronic Materials and Hemlock Semiconductor exported USD 2.52bn of the material while capital equipment exports totalled USD 1.4bn.

Of course, many manufacturers in the developed economies are finding the Asian challenge difficult. In Germany, Q-Cells, SolarWorld and Conergy are all battling sharp swings in demand in Europe as well as competition from the Chinese. Evergreen Solar in US has filed for bankruptcy. New York based cell maker SpectraWatt – which is backed by units of Intel and Goldman Sachs – also filed for bankruptcy last week.

In other news, General Motors and LG Group announced a partnership to design and engineer future electric cars. LG already supplies lithium-ion batteries for the plug-in hybrid – Chevrolet Volt.

Carbon capture and storage got a push in the US with the Department of Energy committing USD 41.3m over three years to research 16 such projects. A statement from the Department’s Office of Fossil Energy said that existing carbon-capture systems may add as much as 80% to the cost of electricity. The goal of the research is to develop processes to remove as much as 90% of a plant’s carbon emissions while increasing the cost of producing electricity by no more than 35%.